A troubling drop in rooftop solar power is coming to North Carolina | Opinion
Consumer advocates feel like Duke Energy tends to go into rate negotiations asking for the moon, but even they were surprised when the N.C. Utilities Commission instead gave the utility the sun.
That may be the effect of a commission decision to let Duke cut the credits it gives homeowners who send electricity from their rooftop solar panels back to the grid, a process called net metering. The changes could stymie growth in rooftop solar energy production in the state and increase Duke’s ability to dominate the solar energy market with industrial-scale solar farms.
How cutting payments narrows the sources of solar power is on vivid display in California. The nation’s top solar power producer has 1.8 million solar power systems on the roofs of California businesses and homes, thanks in part to an incentive program that encouraged the private generation of solar power. But since reductions in credits took effect last year, rooftop solar sales in California have dropped between 77% and 85%.
In an editorial, The Los Angeles Times called for the state to restore rooftop solar power incentives.
“It’s not a surprise that eviscerating the financial incentives for consumers to invest in solar power would cause sales to plummet. But it’s still incredibly disappointing to see the outcome of state regulators’ wrecking-ball approach play out so predictably,” the newspaper said.
In North Carolina, some solar power installers say sales have dropped as much as 80 percent since the credit reductions took effect. “They have killed solar in California. Now they have done it in North Carolina,” one installer told me.
The credit reduction will be phased in, with a limited number of customers able to lock in a “bridge rate.” But the full cut will take effect starting in 2027. Given retail rate hikes already approved, compensation for selling power back to the grid in 2027 will be reduced by more than 50 percent.
Duke has an incentive to keep solar power from expanding too broadly. An abundance of cheap renewal energy would reduce the need for new gas plants and nuclear technology, capital investments that support higher electricity rates.
Duke spokesman Randy Wheeless said the net metering change is about being fair. He said the utility worked with solar installers to find a way that didn’t “benefit the solar customer at the expense of non-solar customers,” but left enough of a payment to make it still worthwhile to install a solar power system.
“The future going forward is still pretty bright for solar in North Carolina,” Wheeless said. “We have a system that has certainty so customers know what net metering is going to be about going into the future and we’ll have some programs that make it attractive for customers that want to go in that direction.”
Duke, repeating an argument used by utilities around the nation, says rooftop solar customers benefit from the grid without paying for its upkeep. The new net metering rate structure in North Carolina sets a mandatory monthly bill for solar customers.
But advocates for rooftop solar say the cost shift claim is unfounded. The environmental advocacy group NC Warn and others have a case before the N.C. Court of Appeals that seeks a court order that the assessment be performed.
“Let’s get the numbers on the table and see if (Duke’s claim) is actually true,” said Jim Warren of NC WARN.
One benefit of encouraging more rooftop solar is that it could reduce the need for natural gas-fueled power plants that Duke plans to build to meet peak demand. That has the common benefit of reducing the burning of fossil fuels.
If North Carolina is to reach its ambitious goals for reducing carbon emissions, it is going to need a lot more solar power. The state is not going to get there by reducing incentives for homeowners, businesses, governments and nonprofits to draw electricity from the sun.
The Utilities Commission needs to think again about this decision and state lawmakers should look anew at ways to get private solar power expansion back on track.
Associate opinion editor Ned Barnett can be reached at 919-404-7583, or nbarnett@ newsobserver.com
