Last chance to protect home-grown solar in Kentucky and defeat House Bill 227

Update, 4.11.2018

Many solar jobs and the future of rooftop solar in Kentucky hangs in the balance as the Kentucky General Assembly returns for two final days on Friday and Saturday of this week, April 13-14.

After months of intense and expensive lobbying by utilities, the Kentucky Chamber of Commerce, and several lobbying groups sponsored by the Koch brothers, a new and equally unacceptable version of HB 227 awaits final action in the Kentucky Senate. This bill would end Kentucky's solar net-metering policy as we know it and wreck Kentucky's homegrown solar industry. If the Senate passes the bill, it would then go to the House for a final concurrence vote. In that case, the last stop would be the Governor's desk.

Senator Jared Carpenter, the chair of the Senate Natural Resources and Energy Committee, continues to champion this bad bill, despite the fact that he represents a district with one of the largest numbers of solar installations and net-metering customers. He has called his committee substitute a "compromise," and recently wrote a letter to members of the Senate, urging them to support the bill. In that letter he apparently made the dubious claim that if the bill makes no one happy, it has to be good. But his version of HB 227 is no compromise. Among other problems, it directs the Public Service Commission to determine the value of rooftop solar by calculating only the costs, but not the benefits. This is a badly crafted and unacceptable piece of legislation, and would be devastating for rooftop solar customers and businesses in Kentucky. 

These next few days are a critical time for Kentuckians to email ALL legislators, members of the House and Senate. Our outrage has slowed this bill down all session long, and it is still possible for this bad bill to be stopped.

The legislative message line is open all week, 1-800-372-7181. Legislators can also be reached at firstname.lastname@lrc.ky.gov. You can find the names of your Senator and Representative - and all legislators - at www.lrc.ky.gov. 

Your message can be: "Vote NO on the Senate version of HB 227. This is no compromise, and should be defeated. Protect home-grown solar businesses, jobs, and customers in Kentucky."

The bill has been the subject of intense lobbying all session. In late January, HB 227 bill appeared stalled in committee. After strong testimony from solar industry representatives and advocates, Rep. Gooch realized he did not have the votes to pass the bill. So he abruptly adjourned the meeting without a vote. He acknowledged that this issue has gotten more public outcry than any other issue in the General Assembly other than pensions and medical marijuana.

But it was given new life in early February when GOP leaders in the House took the unusual step of adding three new members to the House Natural Resources and Energy Committee. Their additional votes were enough to pass the bill through committee and send it on its way. After that, the bill was bogged down by 29 proposed floor amendments that made its passage in the House more difficult. Several weeks ago House leaders sent it back to Gooch's committee to be re-worked. Gooch called several special meetings to try to get it through his committee for a second time. But until March 13 he did not have enough votes to do so.

HB 227 was then quickly passed on March 14 by the Kentucky House, after squeaking through a hastily called committee meeting less than 24 hours earlier. In fact, the revised version of the bill (HCS2) was not publicly available until AFTER the House vote. After a spirited floor debate, the bill passed by a 49 to 45 margin. See how House member voted.

The Senate Natural Resources and Energy Committee then took up and passed a new version the bill. The committee made several significant changes, but did nothing to address the concerns of solar businesses and advocates. 

Your calls and emails and conversations with your neighbors and your legislators are powerful. But the utilities and their lobbying firms are pushing hard. It's important to keep up the pressure! Thanks for contacting your senator!

Urgent actions to defeat HB 227, a bill that endangers rooftop solar in Kentucky.

  • Call 800-372-7181 to leave a message for "my senator, and all members of the Senate." Suggested message: "Vote NO on HB 227. Defeat this bad bill. Protect homegrown solar businesses, jobs, and customers in KY."
 

 Problems with HB 227 (Senate Committee substitute)

  1. UNFAIRNESS – HB 227 is UNFAIR to solar businesses and all the people who want to use solar power. It benefits only utilities – allowing them to recover costs without considering the benefits of solar to the utility or ratepayers.
  2. REGULATORY BURDENS – HB 227 would burden the solar industry and PSC with rate cases that are - by design - set up with rules that will favor the outcomes preferred by monopoly utilities. For example, this legislation directs the public service commission to evaluate all of the costs, but not the benefits, of rooftop solar.
  3. ENSURING UNCERTAINTY FOR CUSTOMER INVESTMENTS - This bill allows future PSC cases to change the terms of net metering for existing and future customers and sets up no language to protect customer investments. This makes it impossible to predict the value of an investment and would thereby destroy the market for rooftop solar.
  4. CLAMPING DOWN ON MARKETS – The Senate version makes the original HB 227 even worse by imposing a hard cap of 1% on the solar market for every utility. This restriction is the exact opposite of the solar industry’s goal (and the desire of many Kentuckians), which is to expand the solar market.
  5. TILTING THE PLAYING FIELD FURTHER IN FAVOR OF UTILITIES – The solar industry seeks a level playing field to compete with utilities via increasing system sizes, and access to leases, PPA’s, and other tools. This bill does not address any of these concerns. It only serves the utilities’ interests.
  6. ONGOING FAILURE TO COMPROMISE – HCS4 creates the pretense of meeting the solar industry’s concerns by directing this issue to the PSC, but it fails to create a fair and reasonable process to resolve the issue. Establishing an unclear, unfair, costly, and burdensome process that favors only the utilities, while immediately disrupting the solar market and restricting its long-term growth is not the result of compromise.

Background information

Kentuckians want affordable and clean energy. We value independence and self-reliance. And as costs continue to fall, it’s no wonder that rooftop solar is an increasingly popular choice for many households, farmers and businesses. In recent years our homegrown solar industry has expanded steadily, creating good new jobs in every region.

But right now, Kentucky lawmakers are pushing an extreme anti-solar bill, HB 227, that will smash independent solar businesses and shatter our opportunity to create a thriving clean energy economy.

This bad bill was introduced by Reps. Jim Gooch, Larry Brown, Sal Santoro, Jeff Greer and Matt Castlen. 

HB 227 re-writes the rules to reward monopoly utility companies and punish consumers. It guts an existing law, known as net metering, that gives qualifying solar customers in Kentucky a one-for-one credit for energy their rooftop systems provide to the grid. If passed, the bill would put rooftop solar out-of-reach for most Kentuckians.

Net-metering is the name for a popular state policy which gives customers a one-for-one credit on their utility bills for energy delivered to the grid by rooftop solar panels or by other forms of locally installed renewable energy.

HB 227 seeks to reward and protect utility monopolies, while restricting consumer choice and hobbling Kentucky’s independent solar energy industry by:

  • Rewriting Kentucky’s net-metering rules so that monopoly utility companies – and not Kentucky’s residents, workers, or solar businesses – can benefit from solar energy.

  • Ending net-metering as we know it and slash by about 65% (or more) the value of the credit utilities give to customers for energy from their rooftop solar systems.

  • Establishing a new value for solar energy credits that is based only on the costs claimed by the utility, while disregarding the many benefits that net-metered solar energy systems deliver to utilities and all non-participating customers.

  • Grandfathering in existing net-metered systems, but ending those arrangements when a property is sold. 

Taken together, these provisions could bring rooftop solar installations to a screeching halt across Kentucky, while ensuring that electric utility monopolies are the only ones permitted to benefit and profit from the power of the sun.

The version of the bill that passed through the House Natural Resources and Energy Committee on March 13th is called a "compromise" by the Rep. Gooch. But it was not produced from negotiations with Kentucky's solar industry representatives and advocates. And it is in no way acceptable. 

Even before the introduction of HB 227, Kentucky’s solar energy laws are among the most restrictive in the nation. For example, Kentucky already:

  • Caps the size of net-metered systems at 30 kW. (The limit in West Virginia, Indiana and Virginia are 2,000, 1,000, and 500 kW respectively.)

  • Caps the total capacity of net-metered systems at 1% of a utility’s peak load, a fraction of what other states are already achieving.

  • Provides no state tax incentives for customers who install their own renewable energy systems.

  • Prohibits 3rd party ownership of renewable energy systems, bans virtual net-metering (the ability to assign net-metering credits to other customer accounts), and prohibits independently owned community solar farms.

Kentuckians won’t be surprised to learn that HB 227 is being pushed by a well-funded industry lobbying effort. A front group calling itself “Kentuckians For Solar Fairness” is now running ads in favor of the extreme anti-solar bill. That PR effort is funded by the Consumer Energy Alliance (CEA), which is housed in a Washington, DC-based lobbying firm backed by major utilities and oil and gas companies. In recent years, CEA was found to have submitted fraudulent public comments to the Federal Regulatory Commission and on a petition about a utility rate case in Wisconsin. Yet representatives of the CEA were recently invited to testify before an interim joint committee of the Kentucky General Assembly about solar net-metering.