Your help is needed (again) to stop Kentucky Power’s assault on solar

In January 2021, the Kentucky Public Service Commission (PSC) issued a ruling on Kentucky Power’s rate-hike proposal 2020-00174, but it delayed making a final decision on the part of that case that impacts rooftop solar customers. The PSC will hold a supplemental hearing on the solar net metering issue on April 6. A final ruling is expected by May 14.  

Kentucky Power has asked the PSC for permission to reduce by about 75% the value of the credit they offer to new solar customers for excess solar energy supplied back to the grid. The company also proposed a complex crediting system involving time-of-use blocks, which would further reduce the value customers could gain from having a rooftop solar energy array. (Existing net-metering customers would be grandfathered in at the old rates for 25 years.)

Below are some talking points you may want to use in making your comments:

• The Public Service Commission was correct in pointing out key flaws in Kentucky Power’s net metering proposal. The PSC should follow through by denying Kentucky Power’s new net metering rate.
• In its January ruling, the PSC criticized Kentucky Power’s failure to justify its proposed net metering rates with data (Kentucky Power did not provide an analysis of the actual costs to serve solar customers).
• The PSC also agreed with solar advocates that the company’s “avoided cost” is not the appropriate way to value customer-generated solar energy. Avoided cost is comparable to the utility’s wholesale power rates. Kentucky Power asserts, without providing data, that this is the correct value of net metered solar energy. Setting the value of rooftop solar at the avoided cost means solar customers would be credited only 3.7 cents per kwh for excess energy fed to the grid, rather than at the current retail rate of 11 cents per kwh.
• Based on these and other concerns, the PSC should take the appropriate and reasonable action of denying Kentucky Power’s net metering proposal.

• The PSC has taken an important step by hiring a consultant to advise them on the net metering issue. With assistance from this consultant, the commission’s decision in this case should rely on careful consideration of expert testimony and on rigorous data analysis, including a full accounting of the costs and benefits of customer-generated renewable energy.

• The PSC’s decision in this case should take into account a number of serious problems with Kentucky Power’s net metering proposal. Specifically:
• Rooftop solar owners are not trying to be wholesale energy producers. Kentuckians want solar on our roofs for other important reasons, for example: to be self-sufficient; to save money, especially on the retail utility charges; to be responsible by protecting our environment; to support clean energy development; and to support local business growth. Rooftop solar customers with net-metering service never receive payment for excess energy provided to the grid, only credit against future consumption. It is not fair to treat rooftop solar customers under rules designed for wholesale energy producers.
• Kentucky Power’s plan ignores rooftop solar’s value to the utility and other customers: Solar helps with costly peak demand and has other documented benefits to the grid, climate and health. These benefits, as well as any costs, must be included in a fair calculation of the value of net metered solar energy.
• Kentucky Power’s plan will make rooftop solar far less affordable, as it severely limits the ability for solar users, including homeowners, small businesses and nonprofits, to pay off their installations through savings on their electricity bills.
• Kentucky Power’s plan will badly damage the local rooftop industry in our state, just when eastern Kentucky - and our whole state - badly needs these good-paying jobs. 

• Kentucky Power has already caused significant harm to potential solar customers and existing solar businesses by temporarily imposing their new net metering rate instead of waiting for the PSC’s final decision. 

Kentucky Power could have and should have chosen to wait for a final ruling from the PSC. Instead, by temporarily imposing their new net metering rates effective January 14, 2021, Kentucky Power created grave uncertainty for any customers in their service territory who planned to install solar in the first two quarters of 2021. This disruptive and unnecessary action taken by Kentucky Power is likely to halt new solar installations in this timeframe, and calls into question the company’s commitment to serving the interests of customers and businesses in eastern Kentucky.

For example: Mountain Association and HOMES Inc. (an affordable housing provider in Whitesburg) both have clients who were planning solar installations in Kentucky Power’s service territory. Without any way to predict if the Public Service Commission will ratify Kentucky Power’s proposed changes to net metering, reinstate the original net metering rate or establish something altogether different, those Kentucky Power customers cannot project the financial value of their solar investment. Those projects are now unlikely to move forward. In this way, Kentucky Power’s decision to impose its net metering rate before a final decision from the PSC is likely to result in halting new solar investments, depriving eastern Kentucky communities and residents of the associated jobs and financial benefits.