Baker opposes lifting net metering cap

Sides with utilities on key solar subsidy

THE BAKER ADMINISTRATION, siding with electric utilities over solar developers and environmental groups, is recommending no expansion of a key state solar subsidy until a more cost-effective program to harness the sun’s energy can be developed.

In a letter accompanying a task force report released late Friday, two Baker administration officials said they favored continued growth of the state’s solar power industry, but in a more cost-effective manner. They specifically noted that electric customers who don’t have solar panels on their roofs will be footing the bill for between $2.5 billion and $4 billion in solar subsidy costs between 2014 and 2020.

“Any future credit and incentive must be at the appropriate levels to continue driving the solar industry forward. At the same time, ratepayers who fund the programs through electric rates should not be paying more than is necessary to reach the installation goals,” said Dan Burgess, the acting commissioner of the Department of Energy Resources, and Angie O’Connor, the chair of the Department of Public Utilities. A Baker administration spokesman said neither official would be made available for an interview.

Solar power in Massachusetts receives two major state subsidies. One subsidy, called a solar renewable energy credit, is granted for each kilowatt hour of solar electricity produced. The other subsidy, called a net metering credit, is provided for each kilowatt hour of solar electricity fed into the region’s power grid. Both subsidies are paid for by the state’s electric utilities and passed along to their customers through their bills.

The Net Metering and Solar Task Force said in its report that solar power is heavily dependent on state subsidies and that the subsidies yield more economic benefits to ratepayers than they cost. But utility and business officials on the task force suggested the economic benefits of solar could be attained at far less cost.

Eversource, for example, estimated that Massachusetts electric customers are currently paying about 60 cents a kilowatt hour for solar electricity, while Connecticut customers are paying 25 cents. Eversource also noted that onshore wind power is available for 8 cents a kilowatt hour.

The availability of net metering credits is capped in each utility service area. The cap limit has already been reached in the National Grid service territory and is being approached in the Eversource service areas. Solar industry officials had been hoping the task force would reach consensus on the net metering issue and recommend the Legislature approve an increase in the caps. A clear majority of the task force favored increasing the net metering cap, but the Baker administration sided with the minority viewpoint in recommending that the existing caps remain in place.

Officials on the task force from Eversource, National Grid, and Associated Industries of Massachusetts voted not to lift the cap on net metering credits until a more sustainable solar subsidy program can be developed. Nine other task force members, including representatives from the solar industry, environmental groups, and Attorney General Maura Healey’s office, voted to lift the cap while a new subsidy program is developed. Those in favor of lifting the cap say the failure to do so will lead to market disruption and layoffs.

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Bruce Mohl

Editor, CommonWealth

About Bruce Mohl

Bruce Mohl is the editor of CommonWealth magazine. Bruce came to CommonWealth from the Boston Globe, where he spent nearly 30 years in a wide variety of positions covering business and politics. He covered the Massachusetts State House and served as the Globe’s State House bureau chief in the late 1980s. He also reported for the Globe’s Spotlight Team, winning a Loeb award in 1992 for coverage of conflicts of interest in the state’s pension system. He served as the Globe’s political editor in 1994 and went on to cover consumer issues for the newspaper. At CommonWealth, Bruce helped launch the magazine’s website and has written about a wide range of issues with a special focus on politics, tax policy, energy, and gambling. Bruce is a graduate of Ohio Wesleyan University and the Fletcher School of Law and Diplomacy at Tufts University. He lives in Dorchester.

About Bruce Mohl

Bruce Mohl is the editor of CommonWealth magazine. Bruce came to CommonWealth from the Boston Globe, where he spent nearly 30 years in a wide variety of positions covering business and politics. He covered the Massachusetts State House and served as the Globe’s State House bureau chief in the late 1980s. He also reported for the Globe’s Spotlight Team, winning a Loeb award in 1992 for coverage of conflicts of interest in the state’s pension system. He served as the Globe’s political editor in 1994 and went on to cover consumer issues for the newspaper. At CommonWealth, Bruce helped launch the magazine’s website and has written about a wide range of issues with a special focus on politics, tax policy, energy, and gambling. Bruce is a graduate of Ohio Wesleyan University and the Fletcher School of Law and Diplomacy at Tufts University. He lives in Dorchester.

Sen. Benjamin Downing, a Democrat from Pittsfield and a member of the task force, was not listed as voting on the net metering initiative. But he said he was concerned that it could take six months to a year to develop a new solar subsidy program. “I don’t think we can keep the caps where they are now while we work on a long-term solution,” he said. “There are costs. There are benefits as well.”

The Mass Solar Coalition, a group of solar industry and environmental groups that had several members on the task force, issued a press release on Monday urging lawmakers to quickly vote to lift the net metering cap to prevent planned solar projects from being scrubbed.