My Turn: On net metering, it’s time for state to think bigger

For the Monitor
Published: 1/29/2018 12:15:10 AM

Most people who already know something about “net metering” are homeowners or businesses who have put solar panels on their roof. Now it’s time for everyone to look at net metering in an entirely different way, even if you know something about it already.

It’s time to think bigger.

A new bill in the Senate, SB 446, is a great path forward to that bigger and better energy future. It would raise the net metering project cap size from its current limit of 1 megawatt (MW) to 5 MW. (For those of you who aren’t sure what net metering is, it’s the ability to generate some or all of your own electricity and remain connected to the utility grid.)

What is the significance of the current 1 MW size limit, you ask? Not much – it’s an arbitrary number. It’s not a number that otherwise is used in statute anywhere else.

Many years ago when net metering was first created, the limit was 100 kilowatts (kW) and then later amended to 1,000 kW (or 1 MW).

On the heels of the 2017 decision by the Public Utilities Commission on net metering, there is no reason to artificially constrain competition in the electrical generation marketplace: Such a constraint only serves to keep prices higher. For projects larger than 100 kW, there never was any possible “cross subsidy” between net metering and non-net metering customers, because the utilities receive their full payments for transmission, delivery, demand, and all other costs – everything but retail energy generation services. There’s no good justification for continuing to limit the net metering project size regulations as it only continues to harm producers and consumers (and our state economy) by restraining in-state commerce that could otherwise occur.

This change would serve to increase supply competition and lower prices for consumers. Electrical energy was once only provided by a monopoly utility provider, but today we currently have retail options from multiple large third-party providers. However, these third-party re-sellers are still very large national companies or simply “middle men” that stand between the producers and the consumer. Net metering sales eliminate the out-of-sate middle men “re-sellers,” so that some consumers can access better pricing and longer terms options for electricity directly from our own smaller in-state producers. The companies that would be selling group net metering power are real companies located right here inside New Hampshire.

All consumers would benefit from this change, including municipalities and large manufacturers.

The electrical grid is changing rapidly. Consumers are looking for more choices and large centralized power plants are no longer being constructed with the deregulation of both wholesale and retail energy supplies. Even though fuel prices are relatively low today in the country due to expanded sources of oil and natural gas, New Hampshire consumers have not experienced corresponding reductions in their electrical rates. That is in part to growing transmission costs, which this change would help mitigate.

Our municipalities and manufacturers are very large purchasers of electricity. They have the scale to leverage their buying opportunities on bulk commodities like electricity. New Hampshire manufacturers are well positioned to take advantage of the higher size limit to undertake or expand their own power projects to become net metering customer-generators or group net metering customer-generators using a more diverse set of technological options, including solar, co-generation and some limited hydro opportunities.

This change would help to attract more companies (for example, Amazon) to New Hampshire by providing large companies more choices as to how they purchase and/or produce their electricity. There any many national and international brands that already have their own sustainability energy programs in place that guide their operations at every location. This change would fit into their needs and improve our recruitment chances.

Changing our net metering regulations from 1 to 5 MW is a good first step to the future. It is one solution to lower costs through competition and keep tens of millions of our energy dollars in the state every year.

Making this change now at the same time as the liquidation of the PSNH generation assets is the perfect time. New Hampshire needs the courage to stand up for our own economic interests. Other states (like Massachusetts) are already shifting regional transmission and generation costs to New Hampshire through the implementation of vast energy efficiency and renewable energy investments. Doing nothing here is not an option.

(Harold Turner is president of the H L Turner Group, Inc. in Concord, chairman of the Granite Institute and former board member of the U.S. Chamber of Commerce.)




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