NET METERING
Net metering supports rooftop solar, helps customers manage their utility bills, and allows equitable access to clean energy. Now is not the time to derail the progress made on distributed solar.
Net metering is a utility billing policy that enables customers who generate electricity from their own solar systems to receive a bill credit for any energy they export to the grid. This arrangement encourages residential and business customers to invest in solar power, reducing carbon emissions and providing substantial economic benefits to their neighbors and communities.
According to Solar Energy Industries Association (SEIA), “traditional net energy metering (NEM) is fundamentally a bill credit that represents the full retail value of distributed electricity delivered to the distribution system, and has been a critical policy for valuing and enabling distributed generation.”
Cost Savings
Net metering allows solar system owners to offset their electricity costs by exporting excess electricity back to the grid. When the solar panels produce more electricity than is consumed on-site, the surplus flows out and serves their neighbors, which the utility resells at full retail rates. Net metering allows the solar-generating customer to receive retail credits for surplus solar, which comes in the form of a reduction in their electricity bill. This helps lower energy expenses and provides a predictable financial incentive for investing in rooftop solar, making solar a viable investment for low to moderate-income households. By generating electricity at the same place where they use it, net metering customers also avoid the costs the utility incurs overtime to send electricity over long distances from larger facilities.
More Clean Energy
Net metering encourages the adoption of renewable energy sources like rooftop solar, which offers a myriad of environmental and health benefits to Wisconsin communities. Compensating solar system owners for the excess electricity they generate promotes clean, sustainable power generation. This reduces reliance on fossil fuels, decreases greenhouse gas emissions, and supports the transition to a more environmentally friendly energy system.
Community Resilience and Energy Equity
Rooftop solar can be a boon for underserved communities, providing access to clean energy and reducing energy costs for households that may be disproportionately burdened by high electricity costs.
Grid Stability and Responsible Electricity Consumption
Distributed generation, such as rooftop solar, contributes to a more resilient and reliable power grid. During periods of peak electricity demand, solar panels can offset the load on the grid, reducing strain and the risk of blackouts. Diminishing the value of excess solar electricity exported to the grid will encourage customers to consume large amounts of electricity, like running the dishwasher or doing laundry, at times when their solar array is producing the most electricity. This excess renewable energy could flow to neighbors and make communities more resilient. Time-of-use policies encourage grid balancing, and traditional net metering aligns utility financial incentives with responsible energy practices. All customers should be motivated to consume energy at the most appropriate times. Doing away with net metering would lead to perverse energy consumption during times of peak grid demand.
Energy Independence and Empowerment
Net metering empowers individuals and businesses to take control of their energy production and consumption. It enables energy independence by allowing them to generate their own electricity and reduce dependence on the grid. This increased self-reliance gives individuals greater control over their energy costs, provides a hedge against rising electricity prices, and enhances energy security.
Local Job Creation and Economic Growth
The widespread adoption of rooftop solar supported by net metering can stimulate local economies and create jobs. The installation, maintenance, and servicing of solar systems generate employment opportunities in the renewable energy sector, fostering economic growth and providing long-term benefits for Wisconsin businesses and communities.
MGE’s proposal would hurt working Wisconsinites by making going solar more expensive.
MGE’s proposal will unfairly reduce the compensation customers receive from going solar, treating a neighbor that might install a dozen solar panels on their home in the same way as a large corporation that installs hundreds of solar panels on a warehouse and can take advantage of economies of scale.
In addition, the rates at which the neighbor would be compensated are volatile and subject to change every year, creating uncertainty over the system’s value in the long term. It will be more difficult for people who cannot afford the upfront cost of purchasing solar panels to find the financing they might need.
Current net metering customers would be protected for now. Existing customers and interconnection applications received on or before September 1st, 2024, will receive legacy net metering, but MGE does not say how long that treatment will last. New applications must be interconnected on or before December 31, 2025, to qualify for this legacy treatment. Solar interconnection applications received after September 1st, 2024, will be assigned to MGE’s new program, which pays solar customers with low wholesale rates.
Alliant’s Proposal: The Power of Partnership
RENEW Wisconsin and Alliant Energy have agreed to preserve net metering for two years and have created a clear pathway for future rooftop solar installations. At the end of the two-year period, new Alliant solar customers will shift away from net metering and into Power Partnership, a proposal that will support the sustainability of the solar industry.
Power Partnership preserves key aspects of net metering while creating new benefits. The agreement is a compromise that offers a durable framework that recognizes the value of each customer’s solar installation to Alliant’s infrastructure. Power Partnership limits the risk to installers, ensures a steady revenue stream to solar customers, and provides a solid growth path for solar and storage.
Additionally, after net metering is fully phased out, Power Partnership will continue to provide customers and installers with the information they need to estimate payback periods for new installations. This was a non-negotiable aspect of RENEW’s agreement with Alliant…
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