Advocates Demand Unified Approach to Wisconsin Net Metering

Last Updated on October 30, 2023

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Advocates are demanding a unified approach to Wisconsin net metering as utilities in the state propose conflicting changes to rates.

Madison Gas and Electric (MGE) and Alliant Energy are both seeking amendments, causing concerns among solar advocates. MGE wants to scale back net metering rates for solar generation, while Alliant Energy aims to calculate compensation on an hourly basis.

Advocates argue that a consistent policy should be developed by the Public Service Commission, considering the long-term value of distributed solar and its environmental benefits.

Key Takeaways

  • MGE and Alliant Energy are proposing changes to net metering rates in Wisconsin utilities, which would significantly reduce the compensation for solar generation.
  • Advocates are urging the state Public Service Commission to deny these proposals and develop a uniform policy for compensating residential solar generation.
  • Solar advocates argue that solar reduces the need for costly new generation and makes the grid more resilient, while utility companies claim that customers without solar are paying an unfair amount for grid upkeep.
  • Advocates emphasize the need for a unified approach to net metering in Wisconsin utilities, taking into account environmental benefits and considering the full, long-term value that distributed solar provides to the system.

Proposed Changes to Net Metering Rates in Wisconsin Utilities

Alliant Energy is proposing changes to net metering rates in its rate case. The proposed changes include calculating compensation on an hourly basis instead of monthly. These changes have significant implications for net metering in Wisconsin utilities and will impact both residential and commercial customers.

Under the new proposal, customers will be paid anywhere from 7.9 to 13.5 cents per kilowatt-hour for their energy, depending on when it’s sent to the grid. This represents a scaled-back rate compared to the previous system.

Residential customers with small solar arrays will be put on the same program as commercial customers with large arrays. These changes have sparked concerns among solar advocates who argue for a unified approach to net metering and the consideration of the full, long-term value that distributed solar provides to the system.

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MGE’s Proposal to Scale Back Wisconsin Net Metering Rates

MGE is proposing to scale back net metering rates for solar generation. Advocates are concerned about the impact this will have on the adoption of solar energy in Wisconsin. Under MGE’s proposal, residential customers with small solar arrays would receive the same compensation rate as commercial customers with larger arrays. This means that customers who install solar after 2024 would receive about 7 cents per kilowatt-hour, compared to the current rate of about 16.6 cents.

Advocates argue that this reduction in compensation could deter people from investing in residential solar installations. Additionally, there are concerns about the potential consequences for grid resilience. Solar energy reduces the need for costly new generation and makes the grid more resilient.

Alliant Energy’s Proposed Changes to Wisconsin Net Metering

Advocates are concerned about the potential impact of proposed changes to net metering by Alliant Energy, as it could have significant implications for the adoption of solar energy in Wisconsin.

Alliant Energy is proposing changes to net metering in its rate case, which includes calculating compensation on an hourly basis instead of monthly. Under the proposed changes, customers could be paid anywhere from 7.9 to 13.5 cents per kilowatt-hour for their energy, depending on when it’s sent to the grid.

To address these changes, Alliant Energy has worked with Renew Wisconsin on an agreement that allows customers to choose between the previous net metering plan or a new program called the Power Partnership program. The agreement also includes providing information for customers to calculate the expected payback period for their solar installations.

Concerns and Arguments Against the Proposed Changes

Some stakeholders are concerned that the proposed changes to net metering rates in Wisconsin utilities may have negative impacts on the adoption of solar energy. Solar advocates argue that the Public Service Commission should develop a uniform policy for compensating residential solar generation. They fear that if the proposed changes are approved, fewer people will be able to install solar.

MGE, one of the utilities, argues that customers without solar are paying an unfair amount for grid upkeep. However, solar advocates counter this by stating that solar reduces the need for costly new generation and makes the grid more resilient.

The potential economic consequences of these changes are also a concern. The Wisconsin Citizens Utility Board director of regulatory affairs testified that revised compensation structures should consider the full, long-term value that distributed solar provides to the system.

The Need for a Unified Approach to Net Metering

The need for a unified approach to net metering is crucial in order to ensure fair compensation for residential solar generation in Wisconsin utilities.

Net metering allows residential customers to receive credits for excess electricity they generate from their solar panels and send back to the grid. This not only benefits the customers by reducing their electricity bills, but it also benefits the environment by promoting renewable energy.

However, proposed changes to net metering rates in Wisconsin utilities could have a potential impact on the solar industry. Scaling back net metering rates or changing the compensation structure could discourage residential customers from investing in solar installations, leading to a slowdown in the growth of the solar industry in the state.

A unified approach to net metering would provide consistency and stability, ensuring that residential customers are fairly compensated for their solar generation and helping to support the continued growth of the solar industry in Wisconsin.

Advocates for a Unified Approach to Net Metering

They believe that a unified approach to net metering is necessary to ensure fair compensation for residential solar generation in Wisconsin utilities. Advocates argue that a uniform policy for compensating residential solar generation should be developed by the Public Service Commission. They emphasize the benefits of net metering, such as reducing the need for costly new generation and making the grid more resilient.

By allowing residential solar customers to send excess energy back to the grid and receive credits for it, net metering encourages the adoption of renewable energy and reduces reliance on fossil fuels. The advocates also point out that other states with higher net metering participation rates, like Hawaii and California, still offer net metering policies.

A unified approach to net metering would provide consistency and clarity for both residential solar customers and utilities in Wisconsin.

A Holistic Approach to Net Metering

As the discussion on net metering rates continues, advocates are calling for a comprehensive and unified approach to address the complexities of compensating distributed solar generation in Wisconsin utilities.

They argue that a holistic approach to net metering is needed to consider the environmental benefits and the role of utilities in supporting renewable energy.

Advocates propose that net metering rates or other forms of compensation should be based on the avoided costs for generation, transmission, distribution, and capacity.

This approach would allow the state Public Service Commission to develop a framework for utilities to adopt as the penetration of distributed solar increases.

They point to states like Hawaii and California, which have higher proportions of solar on their grid and still offer net metering policies, as examples that Wisconsin can learn from.

The Role of Avoided Costs in Net Metering Rates

Advocates argue that a comprehensive and unified approach to net metering rates in Wisconsin utilities should consider the role of avoided costs for generation, transmission, distribution, and capacity.

This approach aims to ensure fair compensation for distributed solar. Avoided costs refer to the expenses that utilities would otherwise incur if they had to generate, transmit, distribute, and provide capacity for the electricity that’s produced by distributed solar systems.

By taking into account these avoided costs, net metering rates can accurately reflect the value of the electricity being generated by solar customers and compensate them accordingly.

Advocates believe that considering avoided costs in net metering rates is essential for creating a fair and transparent compensation structure that encourages the growth of distributed solar in Wisconsin.

Comparing Net Metering Participation Rates in Different States

Other states have higher net metering participation rates, and they still offer net metering policies. Comparing net metering participation rates in different states can provide insights into the impact of net metering on utility grid resilience.

States like Hawaii and California, known for their higher proportions of solar on the grid, continue to offer net metering policies. These states recognize the value of distributed solar generation and its contribution to grid stability.

In contrast, Wisconsin has a lower net metering participation rate compared to other states. This suggests that there may be room for improvement in Wisconsin’s approach to net metering, particularly in terms of encouraging greater participation in solar generation and harnessing its benefits for grid resilience.

The One-Time Incentive Payment Proposal for Solar Installation

The Wisconsin utilities’ proposal includes a one-time incentive payment for the installation of solar. This incentive is aimed at encouraging more customers to adopt solar energy and offset the cost of installation.

The benefits of this one-time incentive payment are that it provides an immediate financial boost to customers who choose to go solar, making it more affordable for them to invest in renewable energy. It can also help stimulate the solar industry and create jobs in the state.

However, there are potential drawbacks to this approach. Some argue that a one-time payment may not be sufficient to incentivize long-term investment in solar energy. Additionally, it may not provide ongoing financial benefits to customers who generate excess energy and contribute to the grid.

It’s important to carefully consider these factors when evaluating the effectiveness of a one-time incentive payment for solar installation.

Wisconsin Net Metering – Wrap Up

In conclusion, advocates for solar energy in Wisconsin are urging for a unified approach to net metering as utilities in the state propose divergent changes to the rates. Madison Gas and Electric (MGE) and Alliant Energy have put forth different proposals, causing concerns among solar advocates.

They argue for a uniform policy developed by the state Public Service Commission that considers the full, long-term value of distributed solar and takes into account environmental benefits. A holistic approach to net metering is necessary to ensure fair compensation for residential solar generation.

Author

  • John Miller

    John Miller is a seasoned professional in the field of solar energy, holding a Bachelor's degree in Electrical Engineering from UCSD and a Master's degree in Sustainable Energy Systems from the University of Michigan. With his expertise in solar panel design, system integration, and performance analysis, John specializes in developing and implementing customized solar power solutions for residential and commercial applications for some of the nation’s top solar providers.

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