Indiana’s 12-year-old policy of allowing homeowners who generate their own electricity to ship any energy they don’t use to the grid and get a dollar-for-dollar credit from their utility is under fire again, according to a January 21 report by the Indianapolis Business Journal.
A bill (SB 309), reintroduced in the Indiana General Assembly on January 9 after failing to pass in 2015 would discontinue net metering in the Hoosier State – effectively wiping out a key financial incentive for homeowners and businesses to install rooftop solar and wind generation, according to the local news outlet.
The measure, called Distributed Generation, would satisfy utilities, which say that customers with rooftop solar systems are basically getting a free ride, because they receive credits – equal to what other residential customers pay, at a retail rate of about 11 cents per kWh – for generating their own power, yet still have access to the grid when they need it. The utilities contend that, when customer-generators produce their own power, the cost of maintaining the grid doesn’t go down; it shifts to the rest of the customer base.
Under the proposed changes, customer-generators would not be able to retain and use the energy they produce. Instead, they would have to sell it back into the grid at a wholesale rate—now about 3 cents per kWh.
If passed by the legislature, under the new system, customer-generators would be required to buy all of their energy from the utility at the higher retail rate. That system is known as “sell all, buy all.”
The utility would keep the difference—now about 8 cents per kWh—to maintain the grid and pay for other expenses., according to the report by the Indianapolis Business Journal.
Indiana electric utilities say the change is warranted.
“Net metering creates a situation where customers with solar panels are being paid by customers without solar panels,” Mark Maassel, president of the Indiana Energy Association, told the news outlet. “That’s just not fair.”
Solar advocates strongly oppose the bill, arguing it would discourage consumers and businesses from taking on the cost of solar systems, which can add up to $20,000 for a typical house and more than $1 million for a factory.
“One of the fundamental reasons people put solar panels on their roofs is to reduce consumption from the grid—to be self-reliant, sustainable, efficient,” said Kerwin Olson, executive director of Citizens Action Coalition, a grass-roots consumer group. “That should be encouraged to the highest degree.”
The legislation is set for a hearing on February 2.