MONTPELIER, Vt. – When the tiny Washington Electric Cooperative Inc. announced last week it was moving to slow the growth of customers installing solar power systems and putting their extra electricity on the power grid, it brought to the fore a battle that had been brewing for years.
The Shumlin administration, lawmakers and Vermont’s largest utility have been cheering the arrival of solar energy and “net metering” on Vermont’s electrical generation scene, while smaller municipal and cooperative utilities have been pushing back.
Net metering allows owners of solar and other renewable power generators to put their excess power on the grid and run their meter backward, reducing their monthly power bills, sometimes to zero.
That’s the rub for Washington and some other smaller utilities. They say that when net-metered customers stop paying, others are left to cover the costs of maintaining poles, wires and other operational costs. It’s a warning some made during legislative debates at least as far back as 2008.
Supporters of net metering say it’s paying for itself in ways not always obvious to ratepayers.
Kerrick Johnson, vice president of the Vermont Electric Power Co., the company that runs the statewide large-scale transmission backbone for Vermont’s utilities, said his company is legally required to be neutral about power sources.
But Johnson said power production by homeowners and businesses — known as “distributed generation” — was a big part of the reason his company had been able recently to drop plans for about $250 million in system upgrades.
“These projects, in the right areas, with the right generating characteristics, enable us to not have to build transmission in certain instances,” he said.
The announcement from Washington that as of Oct. 1 it would no longer take energy from residential solar systems larger than 5 kilowatts stunned renewable energy advocates who have long admired the East Montpelier-based co-op’s pursuit of renewable sources for its power.
For a utility that uses methane gas from the landfill in Coventry as its main power source, and which already exceeds the state requirement for the amount of net-metered power it takes from its customers by about 50 percent, it looked a bit like an organic farmer coming out against labeling genetically modified food.
Washington officials, like those at the Johnson-based Vermont Electric Cooperative and the municipal electric department in Hardwick, say they worry that allowing some customers to roll their meter back to zero will leave others picking up the utility’s fixed costs — sending crews out to fixed downed power lines in storms, running a billing department and the like.
Not collecting those costs from all members “results in a cost shift to those members without net metered installations,” Washington’s general manager, Patricia Richards, said in an email. “As a not for profit electric utility, which is owned by our members, our only recourse for recovering insufficient revenue is to increase rates.”
“We really love renewables here,” she added in an interview. “This is what WEC is all about. But we need to step back and make sure we’re not being irresponsible financially.”
Vermont’s largest power company, Colchester-based Green Mountain Power Corp., is a big fan of net-metered power, the vast majority of which comes from solar installations, said spokeswoman Dorothy Schnure. She called it “a great fit with the way we peak.”
Demand spikes on hot summer days for Green Mountain, whose load is about a third commercial, a third residential and a third industrial. On those summer afternoons, when office workers are turning up the air conditioning, are also precisely when rooftop solar panels are producing at their maximum.
Green Mountain’s solar-owning net-metered customers are shipping power to the grid, and the company saves in two ways, Schnure said. It doesn’t have to buy as much power off the New England grid when prices there are at their highest, and it doesn’t have to run its backup diesel- and jet-fuel-fired generators as hard or as long, saving both in money and carbon emissions.
Wayne Young, board chairman with the Hardwick utility, said solar is a lot less useful to a rural utility that sees its peak loads on dark winter evenings.
“Our peak is on a Sunday night at 6 p.m. in January when it’s 10 or 15 below,” he said.
Rep. Tony Klein, D-East Montpelier, chairman of the House Natural Resources and Energy Committee and a key architect of Vermont’s policy of promoting renewable energy, said he did not see a need to change course.
Vermont has gradually expanded its net metering program over the past 15 years and likely will continue, he said. “It’s where we’ve wanted to head.”