February 13, 2019 12:40pm
Net-metering modernization bill filed in the Kentucky Senate
Update March 15, 2019: The General Assembly passed Senate Bill 100 on March 14, 2019, and sent it to the Governor’s office.
An important piece of legislation that will modernize Kentucky’s net-metering laws and help the Commonwealth to maintain affordable energy rates has been filed in the General Assembly.
Senate Bill 100, sponsored by Senator Brandon Smith (R-Hazard), proposes allowing the Kentucky Public Service Commission (PSC) to determine the value of excess energy generated by future solar-energy customers. Overseeing energy rates and ensuring they are reasonable and fair is one of the core functions of the PSC.
Under current law, which was written in the previous decade, electric utility businesses are required to credit solar-energy customers for excess energy at the retail rate, which equates to a 300 percent premium relative to other sources of power. This policy requires the costs to fully cover the energy grid to be shifted to all customers. While the fiscal impact of this system today is relatively modest, costs are projected to increase as solar continues becoming more affordable and popular. Senate Bill 100 presents an opportunity for Kentucky to get out ahead of a problem that will cause serious economic harm in the near future. Allowing the PSC to study and determine fair rates will help avoid cost-shifts and keep energy affordable for all Kentuckians.
Under Senate Bill 100, solar energy will still continue to thrive in the Commonwealth. Solar customers would still be able to export excess energy to the grid. The bill would grandfather in all existing solar-energy customers under current statute. Any rate change proposed by the PSC would only apply to customers who begin services after the bill’s proposed implementation date of January 1, 2020. On top of this, Senate Bill 100 would raise the cap on the size of eligible systems from 30kw to 45 kw, a 50 percent increase that would encourage the growth of the solar industry.
Senate Bill 100 proposes a modernized net-metering structure that is sustainable, fair, and forward-looking. GLI strongly supports this legislation as a way to keep energy rates in our region affordable, which is key to economic growth and business attraction.