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What's A Kilowatt Of Solar Worth?

March 20, 2017
What's A Kilowatt Of Solar Worth?

A new state law passed late in 2016 could significantly change the terms under which solar panel owners connect to the grid. The law, which consists of Senate Bills 437 and 438, was celebrated by some environmentalists because it increases Michigan’s renewable energy standard from 10 percent to 15 percent while preserving net metering, the mechanism through which utilities pay solar owners for excess energy they produce and put back on the grid.

But as Patrick Sullivan writes in this week's Northern Express - sister publication of The Ticker - critics worry the language of the bill could cause the net metering rate paid to solar producers to be slashed from the retail rate customers pay per kilowatt of electricity by about half, to the wholesale rate. 

Utilities argue that solar panel owners have gotten a free ride and have been taking advantage of the grid without paying their share of the cost to develop and maintain it. On the other hand, solar advocates note a growing number of studies that show the benefits solar generators offer utilities are worth more than even the retail rate.

The debate in Michigan officially begins March 22, when the Michigan Public Service Commission (MPSC) holds its first meeting among stakeholders to talk about how to implement the new law. How it all shakes out will affect how much new renewable energy is installed in the state.

As things stand, explains former Granholm administration official and senior fellow at 5 Lakes Energy Skip Pruss, consumers in Michigan are getting mixed signals about solar just as the technology is making it an increasingly attractive investment. “Because we don’t know where the MPSC is going to come out on all this, that’s the uncertainty – the tariff could actually be very good for consumers or it could be really quite bad,” he says. “That uncertainty is certainly a disincentive to establish a robust solar market, and that’s unfortunate.”

So where might the debate end up - and what will it mean for the future of solar in Michigan? Read more in this week's Northern Express feature story, "What's a Kilowatt of Solar Worth?" The Northern Express is available online, or pick up a free copy at one of more than 600 distribution spots across 14 counties.


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