Solar industry lines up to fight CPS Energy cuts

April 18, 2013 by  
Filed under Green Energy News

Local solar panel installers showed no signs of backing down Wednesday from a fight with CPS Energy over the utility’s plans to change how much it pays for solar power produced by residential customers.

CPS “should be doing everything possible to ensure that this industry thrives,” said Lanny Sinkin, the executive director of Solar San Antonio. He called for the cancellation of CPS’ new program, known as “SunCredit,” until a “much broader discussion could be held” between the utility and local solar firms.

“I think there is a legitimate question as to whether what they are doing to the existing customers constitutes a rate increase that has to be approved by City Council,” Sinkin said at a meeting put on by the local solar energy promoter at the Mission Verde Center on the city’s West Side. “If they’re reducing my income, that’s the equivalent of a rate increase.”

CPS Energy spokeswoman Lisa Lewis dismissed Sinkin’s contention that the new plan was a rate increase in disguise.

“What we are giving them is a credit for all those things that they are bringing to the table,” she said, adding that “SunCredit” is still a proposal and the utility has scheduled a meeting for May 3 at the Villita Assembly Building to receive input back from the community.

Sinkin’s claim that the program constitutes a rate increase provides his organization, and the solar installers it represents, with an avenue to fight back against CPS’ new program. While CPS’ Board of Trustees is unelected, City Council must approve the utility’s requests to increase rates.

Several of the installers who spoke at Wednesday’s meeting spoke out in favor of pushing City Council to get involved in the issue.

Under the current “net metering system,” CPS’ residential and commercial customers are allowed to count each kilowatt of solar energy they produce against each kilowatt of energy they consume. The arrangement means that during some months, CPS customers with solar arrays may not pay for electricity.

The city-owned utility says that setup is untenable because it means those customers aren’t paying their fair share for the infrastructure that CPS must maintain — its wires, poles and substations.

CPS has proposed replacing “net metering” with “SunCredit,” an arrangement where the utility will credit residential and commercial solar customers a set amount for every kilowatt of electricity produced by their solar arrays. However, a kilowatt of solar energy under this new system would be worth a little more than half of what it was worth under its old system.

Under the proposal, existing customers with solar arrays would be grandfathered in the “net-metering” system until 2023. Customers who get their paperwork in for a solar array installation before the end of May also would be grandfathered in. Previously, CPS had announced the cutoff would be April 27.

Sinkin dismissed CPS’ concerns about paying for its infrastructure during the meeting Wednesday: “When you finally get to the underlying assumptions, the underlying data, there is no issue about infrastructure.”

He said that in areas where utilities were having problems paying for infrastructure, 15 to 20 percent of their customers have installed their own solar power systems. But in San Antonio, he said, only about 0.2 percent of CPS’ customers have installed solar systems.

This is the second time the utility has moved to reduce the incentives it gives for distributed solar power installations. In 2012, the utility cut the size of the rebate it offers to residential customers to help cover the cost of installing a solar panel system at their homes.

CPS Energy isn’t alone in considering cuts to the incentives it provides commercial and residential solar power producers. Municipally owned Austin Energyalso is weighing a cut in its incentives.

“We are reviewing the rebate, and it appears that it will be reduced in the next few months,” said Ed Clark, a spokesman for Austin Energy.

He also said the utility had put out a request for new study of how much the utility is paying its residential customers for their solar power, pointing out that the cost of producing solar power continues to decline.

“You’re always looking at it periodically,” Clark said.

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