Net metering: Which side are you on?

Why the governor’s override pits consumers and businesses against the interests of utility shareholders

If like me, you are one of the homeowners or business owners who added solar panels to your roof over the past 10 years, you are part of New Hampshire’s distributed energy resources.

The more producers (like you) we have, the less power that has to be imported over the regional transmission system to energize our economy. Your solar panels or other small renewable generation run your buildings, and whatever you don’t need yourself flows into the distribution system for your neighbors to use. You get a credit or a payment for your excess power from your local utility company. The credit amount varies by the size of your project, as currently regulated by the Public Utilities Commission.

What’s not to love? It’s something that fits right into our New Hampshire way of self-reliance and independence.

“Whoa, not so fast,” says the utility industry – how do we make more profit when our customer generators are doing that? “You don’t” is the simple answer, and that’s why those forces are once again working to kill this year’s House Bill 365, the legislation that was passed to expand the maximum project size limit from 1 megawatt to 5 megawatts for net metering.

Why the need to get larger projects included? Simple, so that larger businesses, municipalities and group (sharing) projects can participate at a proper economy of scale to fit their needs.

Last year, when Senate Bill 446 was passed to do the same thing, some utilities (Eversource and Unitil) made the argument that large subsidies would be created when they buy the excess power from these distributed energy projects and intentionally sell it (not actually use the power “on paper” that flows into their wires on the street) to the regional grid operator, ISO-NE, at lower wholesale prices, thereby creating a loss.

Many of us said: “You are going to do what????”

Yes, folks, that’s what they said they would do with the power, and apparently that is what they have been doing to ratepayers all along without the general public’s knowledge.

The governor vetoed that bill, the Republican-led House sustained his veto, and the rest is history. Oh, did I mention that both of those utilities own transmission lines that earn shareholders 11% returns on their investments to bring power into our local distribution systems?

Now comes HB365 in 2019, the net metering expansion bill that closes the “loophole,” with language so that our investor-owned utilities actually have to use the power provided by our distributed energy projects, and they can’t “paper” sell it off to ISO-NE and “paper” use their transmission system assets to make profits for shareholders at the expense of ratepayers.

Problem solved. No ”loss” or ratepayer “subsidy” created by that sleight-of-hand practice of reselling a commodity like electricity for less money than you paid for it. Did I mention that neither Liberty Utilities nor the New Hampshire Electric Co-op use this cost-creating practice – and, by the way, they don’t own any transmission line assets either.

Many other people can expound on the boatload of economic reasons we ratepayers and taxpayers want to expand our own little electrical generating assets in New Hampshire in the future. For a simple reason: It will save us money.

Lots and lots of people would like to save some money and become more self-reliant, as is the New Hampshire way, and they all have a vote. Business owners would like to save money too, but they don’t have the same “vote” at the ballot box to push for this change for larger projects.

It feels like we haven’t stopped talking about net metering for the past four years, starting with a string of legislative efforts to expand its use in New Hampshire going back to lifting of the 50MW statewide “cap” that was going to quickly bring it to a halt in 2016.

You would think that the entrenched self-interests of the investor-owned electric utility industry would have dissipated in New Hampshire by now, but no way. Efforts to stifle the growth of smaller distributed energy resources on our local distribution systems are still alive and well, I am sorry to say.

The Legislature (including all “my party,” Republican friends) should stand with New Hampshire electricity consumers, rather than utility shareholders, and override the veto of HB365, now that they understand the true economics at stake here.

If not, then don’t ask for my help in 2020 when you try to justify all this to your constituents. Just remember how popular that Northern Pass transmission line thing was not long ago. It’s time to ignore all the fake news against expanding net metering and self-generation in New Hampshire, and put HB 365 into law.

Harold Turner, a small business owner and professional engineer, is chair of the Granite Institute, a State Policy Network-affiliated think tank.

Categories: Energy and Environment, Government, Opinion