An Idaho proposal that right now only affects 353 mostly solar producing customers attracted more than 50 people to an Idaho Public Utilities Commission workshop Thursday.
The proposal to expand but cap net metering that allows customers to send power they produce on to the grid could unleash forces on Idaho Power to change its business model before its ready just like so many institutions. It comes as Idaho Power decides whether to spend tens of millions to upgrade its coal plants in Wyoming and Nevada and as it must decide to spend tens of millions more on new transmission lines.
It also comes as it just proposed an 8 percent rate hike this year and 4.5 percent increase next year because of low water and low demand for surplus power.
Telephone companies to newspapers and broadcasters, book publishers and dozens of other centralized service providers have been forced by information technology to share markets they previously controlled with decentralized players. Historically the economies of scale benefited people who could raise the capital to build power plants and printing presses, transmission system and telephone lines.
Now cell phones are connected by wireless cell towers. News, books and advertising can be delivered cheaper digitally and increasingly in the developing nations, where there are no telephone and power lines, renewable power distributed individually and locally is playing a larger role faster.
Idaho Power is proposing to double the capacity limit on the amount of energy that can be generated from its net metering customers from 2.9 megawatts to 5.8. It also wants to stop writing checks to solar and wind customers for surplus power at the end of a year. The investor-owned utility also wants to increase the rate solar and wind users pay for the power they get from Idaho Power and quadruple the fees they pay to hook up to the grid.
Idaho Power officials say the added charges are needed to ensure that its other customers aren’t subsidizing the solar-generating customers in the future, though it acknowledged Thursday there has been no impact on other customers’ rates up to now. Solar proponents say the solar home owners actually have been helping keep other customers’ rates lower because it delivers electricity to the grid during peak demand periods in the summer.
Some customers, those who use a lot of electricity, would pay less under the proposal. But the people who had solar panels installed on their homes and the installers who finally have low enough prices to compete with the grid see the Idaho net metering plan as a way to hold them back.
Monday the two sides will sit down with PUC staff and see if they can work out a settlement. If they can’t, customer and technical hearings are set for the week of June 10 and a target decision date of July 1.
Idaho Power will have to decide whether it wants to keep control of the process by allowing the home solar market to grow with the market or stand and fight now to prevent the growth the solar industry has made in other states where the price of electricity is much higher. In the end it must weigh stability and reliability issues as well.
Gynii Gilliam of the Idaho Department of Commerce, which is seeking to grow the economy and jobs, suggested at a recent Integrated Resource Planning meeting the utility consider adopting a program where third-party companies finance and build solar installations on homes. The idea overcomes Idaho Power’s biggest complaint about the cost of switching to solar, the capital costs.
But it gives the business to other companies instead of its shareholders.
As the price of solar technology continues to drop, just like information technology has, there may be a point where the price is so good it will overwhelm any barriers Idaho Power might choose to erect to defend its exclusive service monopoly. Or it could use its still bountiful hydroelectric power as the foundation to transform it into a green investment that allows it to standoff future takeover attempts from larger corporations.
Since it is a regulated utility, the Idaho Public Utilities Commission and the Idaho Legislature will have a large say in the direction Idaho Power chooses. That means you have a say since that’s what a public utility is all about.