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Columns Mark Lannaman

Georgia Public Service Commission allows Georgia Power to hold off on net metering expansion

A home with rooftop solar panels. (Image via Unsplash.)

The popular Georgia Power net metering program will not expand in Georgia in 2023.

The tri-annual Georgia Power Integrated Resource plan hearings before the Georgia Public Commission — not to be confused with the tri-annual Rate Case — encompassed a few topics including expanding or starting a new net metering program, where homeowners with rooftop solar sell the excess energy they generate back to the grid.

Many advocated for the buyback rate — the rate that Georgia Power buys excess electricity — to be set at the rate the utility charges customers to make the program more attractive. Others called for an expansion or extension of the pilot program from a few years ago where Georgia Power bought electricity at the Solar Avoided Energy cost rate. Instead, neither looks to be happening, effectively adding a bump in the road for incentivizing solar adoption around the state. 

The pilot program, RNR Monthly Netting, allowed up to 5000 participants to sell excess electricity Solar Avoided Energy cost rate and reached capacity in July 2021. Proponents called the program a success that demonstrated the potential for solar in Georgia and hoped to see the popular program expand beyond the 5000 customer limit, or see a new program initiated altogether.

Calls for expansion of the program have led to campaigns like Georgia Solar Energy Association’s Scrap the Solar Cap campaign.

Homeowners with solar not in the program can only sell their electricity for a fraction of the retail rate at the moment. Although this rate did increase in the latest Rate Case, though some argue it may not be enough to make the program sustainable and attractive to consumers.

The compromise 

The current buyback rate for solar customers is 2.26 cents per kWh. That looks to receive a bump up with the Public Service Commission and Georgia Power settling at 6.68 cents per kWh for a buyback rate in the new case. This means that Georgia Power will buy the excess electricity back at a rate of 6.68 cents per kWh once the electricity bill is paid, instead of subtracting it from the homeowner’s monthly bill.

While this is seemingly an improvement, some argue that the buyback rate is still too low to truly spur the solar market in Georgia and incentivize investment into rooftop solar for homeowners. For reference, according to Energy Sage, “the average residential electricity rate in Georgia is 14 [cents per kWh.]” 

Currently, more than half of the nation’s states have net metering policies that allow homeowners to sell excess electricity at market rate. 

Dr. Marilyn Brown, Regents Professor at the Georgia Institute of Technology, is a champion of solar and net metering in Georgia. She acknowledged Georgia Power will be able to buy back electricity fairly cheaply from homeowners, but also recognized the agreed rate was not as bad as it could have been. She feels keeping the 2.26 buyback rate altogether would have crippled the industry in the state.

Brown also notes she was not surprised at the agreed rate being somewhere in the middle, citing a divergence of views that range from the 2.26 rate and those who argue for a retail rate. 

She added that the new rate won’t be especially incentivizing for low-income homeowners, though it may be enough to spur interest from middle- and upper-income households.

“They’ll not get as good a deal as [Georgia Power] had for the 5000 households who participated in the past few years. But it might be enough to make it affordable for middle and upper-income households” Brown said. “I am quite worried that this just puts solar outside the range of possibilities for those with low incomes, who are struggling and don’t have much money to spare [on solar panel investments]”. 

The less than retail buyback rate, compounded with the fact of the 12 percent raise in rates over the next three years, could exacerbate disparities in access to solar panels, Brown said. Already struggling households now having to pay for their monthly bills will have less spending money to invest in solar panels, which will take a longer time to recuperate costs than if the buyback rate was set at the retail rate.

Georgia Power argued that net metering puts an unfair cost onto non-solar customers — a “cost shift.” 

The case for net metering

Brown testified before the Georgia Public Commission on Nov. 30 about the opportunities for net metering in Georgia on behalf of the Southern Alliance for Clean Energy and Southface Institute.

Brown pleaded a case for a one-to-one netting for the electricity generated by solar and the grid — essentially, being able to send electricity generated by rooftop solar at the rate at which Georgia Power sells electricity. 

“Out of seven states in the Southeast, North and South Carolina and Florida have net metering tariffs, and they also have the highest customer-sited solar penetration rates in the region,” Brown said.  “The other four Southeastern states — Mississippi, Alabama, Georgia, and Tennessee — do not allow one-to-one netting for electricity supplied to the grid, and they are all in the bottom eight states in terms of rooftop solar penetration”. 

While one-to-one netting for solar won’t quite find itself in Georgia this time around, Brown believes that the solar industry will continue to grow — especially with support from the Inflation Reduction Act. 

In the IRA, Investment Tax Credits for solar installations were extended 10 years into 2032. The IRA’s Investment Tax Credit provides a 30 percent tax credit to homeowners looking to install solar on their rooftops. Efforts like these, Brown says, will make a difference in a problem that can afford no time lost.

“We need solar on rooftops, and we need solar farms in rural areas as well… The challenges we face with the climate crisis demand that we use all resources at hand. So I’m hoping that might play a role in the argument [for solar] in the future” said Brown.

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