Opinion | Michigan residents, businesses must fight for solar energy rights

John Freeman is executive director of the Great Lakes Renewable Energy Association. Becky Stanfield is Senior Director of Western States for Vote Solar.

Imagine you’re the principal of a middle school and you decide to invest in solar to lower the school’s energy bills and invest those savings in school supplies and other classroom needs. One way you’d recoup utility bill savings is with a policy called net metering, where your school would receive a credit on its utility bill for any excess power the school generates and sends back to the grid for someone else to use.

Until recently, everyone who invested in solar, including schools, families and small businesses, had the right to receive a bill credit equal to the amount that the utility charged for selling electricity to the public. Now, DTE Energy wants to slash that credit, along with any hope that Michigan customers can continue to save money with solar.

Related: Opinion | Michigan’s solar energy policy is fair. I know because I helped write it

Michigan residents already pay the highest electricity rates in the Midwest.  Over the last 10 years, residential electric rates have increased 44 percent, even as the average income in Michigan has dropped. While utility rates have gone up this last decade, the cost of solar power has decreased by 85 percent over the same period of time, making solar a cost-effective option for homeowners, businesses and schools to reduce their energy bill.  

While solar technology becomes more affordable, policies like net metering that make it possible for individuals and business to use it are increasingly under attack. Michigan lawmakers must step up to ensure that all residents have the option of generating their own electricity and are protected from attempts by big utility companies to take that right away.

For years, Michiganders with solar had this straightforward net metering arrangement with their utility, paying the retail rate for energy purchased from their utility and earning a credit on their bill at the same retail rate for any extra solar electricity they sent back to the grid. More than 2,500 customers in Michigan are making use of this net metering policy.

In 2016, the Legislature decided to replace net metering and directed the Public Service Commission to develop an “equitable” set of new rules. In response, DTE Energy proposed an alternative that will essentially end the market for small scale solar for homeowners, farmers, business and schools in Michigan.

Under DTE’s proposal, solar customers will face a new automatic bill charge of about $12 a month. On top of that, they will pay DTE more than three times more for electricity they buy than the credit they receive for the excess solar electricity sent back to the grid. And yes, DTE will sell that solar electricity to other customers for a lot more than what it paid.

This one-two punch is unfair to Michiganders and, if approved, will likely put solar out of reach for most people.   

We are asking lawmakers to support House Bills 5861–5865, bipartisan legislation to restore fair net metering. The legislation also includes a framework for community solar gardens, which allow all Michigan consumers to have the option of choosing solar. Right now, physical and financial barriers prevent the majority of families and businesses, including those who rent, have shaded rooftops, or don’t qualify for standard financing solutions, from going solar.

Community solar programs give customers like these a way to go solar and save by enabling them to participate in a shared solar installation located somewhere else in their community and receive a credit on their utility bill for their share of the power produced.

We need more competition in the energy market to help drive down costs for everyone. Solar gives homeowners and business the freedom to choose how they generate and consume electricity and the option to save money. Michiganders have long embraced innovative, forward-thinking technology and the local investments that follow; it’s time our lawmakers do the same with solar energy.

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Comments

Matt
Thu, 08/23/2018 - 8:48am

Gimme Gimme. And of course you leave out the fact that the cost of power generation is a smaller part of the cost we pay in our electric bill, the rest is distribution and management costs which you want to use both directions, complain when it does down and don't want to pay for when you sell your excess power into the grid! If you had a oil well would you think you should get pipelines, trucking and rail distribution free to get your product into the market also? Sorry, just because of past stupidity, speaking of our high electricity rates, it doesn't require the rate payers to subsidize your hobby. But you are always welcome, (i'd encourage!), to cut your connection to the grid and set up your own battery bank, maybe you can even talk your neighbor into running some extension cords into your "utility" and see how that works. Better have a few generators handy!

Steve N
Thu, 08/23/2018 - 10:37am

Matt are you serious? Do you have any idea how Net Metering works? It is a boom to the energy companies as solar peaks day at or around the of maximum use. That is when YOU pay the most if you are on a Time of Use. Example if DTE gives a Solar user .169 per kWh for the power they generate as a credit during the day. They then sell it to you for .229 per kWh and make money on the difference and they charge you a distribution fee. They spend no money on generation. Currently peaker plants can charge much more to DTE so while you only pay .229 per kWh they may be charged as I have seen .449 per kWh. Maybe you should thank your neighbor with solar for he cheap power and keeping your AC running on a hot day.

Steve

Anna
Thu, 08/23/2018 - 2:41pm

Steve - You are absolutely incorrect in claiming that solar energy production peaks at the time of maximum use. Google the "Duck Curve" if you don't believe just me. Solar power actually tapers off as the sun declines in the sky, while the point of maximum demand tends to be just before and the three or four hours after sunset.
And as for the solar panel owners in the neighborhood affecting your AC - the effect is almost all negative due to the very poor power quality created by cheap solar panel inverters burning out the condensers and electric motors in our AC, furnaces, and refrigerators.

Steve N
Fri, 08/24/2018 - 10:29am

You are also incorrect on your statement about bad power. A UL listed SolarEdge or Enphase inverter puts put a perfect sine wave when generating power. They do not damage electronics or make bad power for others. They will not shorten the lives of appliances as they balance the power. Consumers Energy and others will not accept so called bad power.
All electricity is the same when generated correctly. Electrons from Solar, Wind, Gas, Hydro, Coal, Nuclear are still electrons.

They will charge your phone, power your lights or do any task.

Solar and wind do it with almost no impact on the environment. Why not use all sources. We can't keep destroying Michigan with Coal and Coal Ash. We have to live in the Future and not the past.

Steve N

Steve N
Fri, 08/24/2018 - 2:06pm

You are also incorrect on your statement about bad power. A UL listed SolarEdge or Enphase inverter puts put a perfect sine wave when generating power. They do not damage electronics or make bad power for others. They will not shorten the lives of appliances as they balance the power. Consumers Energy and others will not accept so called bad power.
All electricity is the same when generated correctly. Electrons from Solar, Wind, Gas, Hydro, Coal, Nuclear are still electrons.

They will charge your phone, power your lights or do any task.

Solar and wind do it with almost no impact on the environment. Why not use all sources. We can't keep destroying Michigan with Coal and Coal Ash. We have to live in the Future and not the past.

Steve N

Stephen C Brown
Fri, 09/07/2018 - 10:21am

Matt who? Are you saying that many Fortune 500 companies are "solar hobbyists"? Are you saying that Germany is filled with "solar hobbyists"? Please reply with a reliable accounting of the base average cost for local distribution maintenance, which only the utilities know for sure. Aric Nesbitt seems to think it's $280, but is this annual, monthly, or 20 years? Resilience of infrastructure has become a big investment burden, from the effects of climate change. DTE would like to spend those tax dollars, but it's been proven that small-scale generation with microgrids is much more cost-effective. Let's get a complete accounting from DTE and all other utilities, including all taxpayer subsidies involved for health care expenses, pipelines, etc. and then have a discussion involving dollars and cents.

Barry Visel
Thu, 08/23/2018 - 10:08am

Matt’s comment may be a bit harsh, but I think his point is right on. Solar “generators” should be paid fairly for any excess “generation” they sell back to the grid. That price should not include the distribution network and all other utility costs for which the rest of us are paying.

Matt
Thu, 08/23/2018 - 5:33pm

Barry, I left the biggest part of the value (or not) of solar/renewable power equation out and the solar hobbyists will refuse to admit. This is the reliable predictably aspect. What makes the power provided by DTE and CMS's so valuable is that I as a factory owner, hospital, refrigerated food retailer on and on is that I know (99.9%) that 5 weeks from next Tuesday it will be there. These solar hobbyists can not make that promise, which makes their power worth very little if anything. But instead they want the power companies to stand in with having enough constant extra power when they fail to generate, (and the rate payers to pay for it), so what's the point? Again this makes power generated by renewable sources hard to use and worth very little if any thing. As I said before to the solar power hobbyists go ahead cut the cord and keep it to yourselves!

Steve
Thu, 08/23/2018 - 10:35am

Matt are you serious? Do you have any idea how Net Metering works? It is a boom to the energy companies as solar peaks day at or around the of maximum use. That is when YOU pay the most if you are on a Time of Use. Example if DTE gives a Solar user .169 per kWh for the power they generate as a credit during the day. They then sell it to you for .229 per kWh and make money on the difference and they charge you a distribution fee. They spend no money on generation. Currently peaker plants can charge much more to DTE so while you only pay .229 per kWh they may be charged as I have seen .449 per kWh. Maybe you should thank your neighbor with solar for he cheap power and keeping your AC running on a hot day.

Steve

Bill
Thu, 08/23/2018 - 10:49am

Careful what you wish for Matt - if electric utilities continue to ripoff Michigan's solar producers by charging them absurd 'management fees' they might just leave the grid all together. A recent study found that many residents of the UP should already be looking to do just that to save money. http://www.mtu.edu/news/stories/2016/may/leaving-electrical-grid-upper-p...

John Freeman
Thu, 08/23/2018 - 11:05am

Solar users are more than willing to pay their fair share for using the electric grid. The 2016 Energy Law says that this tariff should be "equitable" which means that it should be based on the real cost of service and not some inflated number. In addition, the solar power that is uploaded to the grid should also be fairly valued as to the benefit of the utility. Utilities want to pay about 4 cents per kWh for solar electricity and then turn right around and cell it for about 13 cents to the neighbor of the solar user. How is that fair?

John Langmore
Fri, 08/24/2018 - 10:20am

I agree with these authors. I am a current DTE customer with 23 solar panels on my house, am billed with net metering, and participate in Solar Currents. I pay for electricity that I take from the grid at the standard residential rate and am compensated at the same rate when I send excess electricity back to DTE. I pay the same rates for distribution for energy that I take from the grid at the same rate that other customers pay for distribution. I am able to keep all the solar energy that I use in the house without paying for distribution but I think that is fair, because that energy was never sent to the grid but stayed inside my house. I think that DTE now wants to pretend that I send all my energy to the grid and compensate me at only the non-peak commercial rate, and then pretend that I buy all that energy back from DTE at the residential rate. How can that be fair, when that energy never left my home? Even the current Solar Credit program is unfair to the customer in some aspects. First, I have to sell my RECs to DTE at the rate of $0.03 per kWh, which is about 50% of the open market for RECs. In addition, I have generated $2,000 excess energy to DTE that they have sold to other customers, however they will not pay me for that $2,000 energy generated by my solar panels until I sell my house. Even the current system does not encourage solar generation, and the new billing proposals from DTE would seem to be an even greater penalty. I have a hard time believing how DTE can maintain that their other customers are subsidizing my purchase and use of solar panels!

Vince Caruso
Thu, 08/30/2018 - 3:07pm

Thanks for the article. MI is being left in the dust on renewables. With industry moving toward more stable and less expensive energy we will lose them in the coming years without changes. What they (and the folks of MI) want is stable energy pricing.
Vermont Utility saved over $1/2 M just this summer with battery backup and net metering on homes and businesses. That is why they encourage renewables with battery storage. The GOP Global Warming is not helping either with the 1,000 year (0.1% chance) rain in the UP wiping out whole towns in a single day, which may not rebuild. The new normal for MI.
This is not Rocket Science. MI could be an energy exporter to the tune of $Bs with wind and other renewables with our unique renewable opportunities if we were allowed to move forward into the future.
Lead, follow or get the heck out of the way or get run over!

robertsmith
Mon, 10/29/2018 - 5:42am

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