Ambitious Vermont having second thoughts on renewable energy

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MONTPELIER — Sunny skies for the nation's solar power industry may be turning partly cloudy, as state regulators begin cutting back on subsidies and incentives.

Even in Vermont, which has set a goal of getting 90 percent of its energy from renewable sources by 2050, and where the governor had touted a renewables boom since he took office in 2011, state regulators are tapping the brake.

The Public Service Board, which regulates utilities in the state, earlier this month issued an order scaling back support for solar that has industry officials and environmentalists complaining loudly. The changes include a sharp reduction in the amount of power utilities will be required to buy from customers who generate it with rooftop solar panels.

"It would take close to a century for Vermont to repower our grid with local renewable energy if the arbitrary yearly cap in this rule were implemented," said Olivia Campbell Andersen, spokeswoman for the industry group Renewable Energy Vermont.

The Vermont rules follow similar changes in Arizona, Nevada and elsewhere in which politicians and regulators are looking for shade from some of the solar boom's effects.

Some of the pushback is coming from utilities nervous about "distributed generation" — customer-made power competing with that from traditional power plants.

"Utilities are concerned about increasing penetration of rooftop solar in their territories," said Sean Gallagher, vice president for state affairs at the Solar Energy Industries Association.

Vermont's Green Mountain Power Corp. is an exception, and is pushing distributed generation to the extent of marketing a new Tesla battery allowing customers who make solar electricity during the day to use it at night.

There's also concern about consumers who haven't gone solar absorbing costs formerly borne by those who have: If a homeowner with solar rolls the electric meter back to zero, that leaves the non-solar neighbors to pay the costs of utility line maintenance, billing and other operations.

Vermont and other states are moving to impose or increase "nonbypassable charges" — a minimum amount customers must pay to be hooked to the grid.

Solar defenders say users of the energy provide other savings to the system that should allow them to claim they're paying their way. Distributed generation reduces the need for new, bigger and expensive new transmission lines to bring electricity from distant power plants, for example.

The Vermont rules reduce rates utilities must pay for customer-provided solar and cap the amount of power utilities must take to 4 percent of their load. They also cap the size of projects eligible for net metering at 500 kilowatts.

Johanna Miller, energy program director with the Vermont Natural Resources Council, said that size limit likely would kill plans by some Vermont cities and towns to install solar arrays large enough to power schools and municipal buildings.

Montpelier City Councilor Anne Watson, the council's liaison to the city's Energy Committee, said the rules could prevent the city from reaching its goal of becoming "net-zero" — using no more energy than it produces.

Others argued that the once-fledgling solar industry is now established enough that it no longer needs regulators to support it with special incentives.

Ashley Brown, executive director of the Harvard Electricity Policy Group at Harvard's Kennedy School of Government, said the solar industry will be more competitive in the long run if the training wheels come off.

"Do we want to keep throwing cash at solar installers, or do we want to let consumers get the benefit of the marketplace and declining costs?" he asked.

Andersen said the industry has seen declining costs, and is not opposed to reductions in the rates utilities pay solar customers for net-metered power. Rather, it opposes the cap on how much power utilities must take and on the size of individual solar power systems.


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