Solar power is not a zero sum game

Net metering is also not an incentive

MORE BAY STATERS ARE BENEFITTING from solar power than ever before.    Such widespread adoption of the technology represents a growing consumer desire to control and cut their electricity costs while reducing their environmental impact.  It is the result of thoughtful, stable policies that have cultivated a solar workforce boasting 15,000 jobs and – at nearly 1,000 MW – a top-five national ranking in installed solar capacity. Most exciting for Massachusetts, with only about 2% of electricity coming from solar, the industry’s potential for continued growth is immense.

Unfortunately, this exemplary progress is grinding to a halt due to caps on net metering, the mechanism which compensates solar owners for the clean electricity they deliver to the grid.  For nearly a year, these caps have been reached across most of the Commonwealth without resolution – a fact familiar to far too many municipalities, schools, and businesses that have seen their projects and savings delayed or even cancelled.

We’ve been here before, but never for so long or with so much at stake.  When the caps were last lifted in 2014, the Legislature simultaneously commissioned a task force to study net metering and make solar policy recommendations.  The caps had already been reached again by the time the report was released, but the results were unequivocal: supporting solar and net metering is a tremendous investment for Massachusetts consumers, yielding well over $2 in benefits for every $1 put in. Study after study affirms the enormous benefit of more solar power for not only the environment, but for ratepayers and local economies as well.

Opponents of raising the net metering caps, eager to cite misleading claims about solar’s costs, too often ignore its benefits. Increased adoption of solar power is not a zero-sum game. When private solar developers choose to invest hundreds of millions of dollars in required utility infrastructure upgrades, for instance, the result is a cleaner, more resilient grid at no cost to ratepayers.

Unfortunately, our solar debate has devolved into simplistic soundbites, rather than a constructive discussion about how utilities and developers can collaborate to better serve Massachusetts customers. The truth is that solar policy in Massachusetts is as complicated as it is nuanced, but thoughtful consideration reveals several basic truths.

First, net metering is not an incentive.  Instead, it is a mechanism through which the value of solar can be monetized and shared among ratepayers, giving rise to exciting and socially-impactful business models like community solar.  With sound net metering policy, similar innovations will continue to emerge and drive our clean energy economy.

Next, draconian cuts to net metering rates such as those proposed under the current House bill are not only unnecessary, they would undermine the ability of municipalities, nonprofits, and those unable to install solar on their own property to realize the benefits of solar. In order to be feasible, projects would rely more, not less, on additional incentives like renewable energy credits, which can’t easily be shared among project stakeholders. We should avoid this perverse outcome.

Finally, solar has become a key driver of the Massachusetts economy, with much more room to grow still.  This new and vibrant industry is increasingly attracting and retaining local talent from our leading colleges and universities.  Moreover, thousands of electricians and construction professionals hit by the recession have found meaningful full-time employment at one of more than 400 solar companies and their contractors across the Commonwealth.   We should take heed of the mistakes made in Nevada, where a sudden shift to wholesale compensation for net metering led to the loss of thousands of jobs in the state’s solar ecosystem. This cut was bad for business, bad for workers, bad for ratepayers, and bad for the environment.

Today, over 500 projects solar remain on hold, awaiting legislative action to raise the net metering caps.  Together, they represent nearly 250 MW of generating capacity, well over half a billion dollars in deferred investment into local renewable energy sources, tens of millions of dollars in annual electricity savings for Massachusetts ratepayers,  thousands of local jobs, and hundreds of metric tons of potential carbon emissions reductions for every hour the sun is shining.

Massachusetts is at a crossroads.  A solar industry that attracted more than $800 million in investment into Massachusetts in 2015 alone faces a very uncertain 2016.  Stable policy support has been the bedrock of our burgeoning clean energy economy.  But with that support in question, companies like Nexamp – founded here in 2007 and now one of the region’s largest clean energy employers – are turning to new markets for opportunities to thrive.

Meet the Author

Zaid Ashai

Chairman and CEO, Nexamp Inc.
Recently, a letter signed by over 100 members – more than 60 percent – of the Massachusetts House of Representatives was delivered to the conference committee tasked with resolving the current net metering impasse.  The letter urged swift and sensible action, echoing the familiar sentiments of so many constituents with projects on hold. Massachusetts residents, businesses, schools, nonprofits, and municipalities want more solar, not less, and we should ensure that solar continues to be an option for them.

Please join me in thanking those on Beacon Hill who continue to push for action, and encouraging our lawmakers to lift the caps on net metering.

Zaid Ashai is Chairman and CEO of Nexamp, Inc.