SPRINGFIELD — St. Louis-based StraightUp Solar opened a branch in Bloomington about a year and a half ago as part an effort to grow its business in Illinois.
But the company, which installs solar power systems for residential, commercial and nonprofit customers, is worried that legislation under consideration in the General Assembly would stall the growth of the fledgling industry in the state, said Shannon Fulton, StraightUp Solar’s director of business development and president of the Illinois Solar Energy Association.
Exelon Corp.’s “Next Generation Power Plan” is intended, in part, to save its financially struggling nuclear plants in Clinton and near the Quad-Cities. Exelon has said it will shut down the Clinton Power Station on June 1, 2017, “if adequate legislation is not passed that properly values nuclear power for its economic, environmental and reliability benefits during the spring Illinois legislative session scheduled to end May 31.”
But solar advocates say the bill, which is scheduled for a Senate committee hearing today, would make changes to rate structures for customers of Exelon subsidiary Commonwealth Edison that would undermine the financial viability of their industry.
“Within this bill there are some poison pills that are unprecedented,” said Amy Heart, a senior public policy manager for The Alliance for Solar Choice.
The industry has focused its criticisms on two components of the proposal.
The first is a change in the way customers are charged to cover ComEd’s costs for distributing power. Currently, residential customers of the Northern Illinois utility are charged per kilowatt-hour, but the proposal would shift to a “demand charge,” which would be assessed based on each customer’s peak usage during the month.
“This changes the fundamental way that we interact with our energy,” Heart said, adding that customers’ bills could vary widely from month to month.
For StraightUp Solar and companies like it, that would mean more difficulty estimating whether installing rooftop solar panels would pay off for people in ComEd territory, Fulton said.
“It does infuse uncertainty and variability in our ability to really, truly know what the financial value of solar will be for a customer,” she said.
The proposal has also drawn criticism from Attorney General Lisa Madigan and AARP Illinois, who have expressed concerns about the broader impact on customers’ power bills.
ComEd executive say a majority of customers would actually see a decrease in the electricity distribution charge on their power bills.
That includes more than 70 percent of low-income customers, said Val Jensen, senior vice president of customer operations.
“More people will benefit from this,” he said, adding that the majority of those who do pay more will see an increase of less than $3.
The second issue, perhaps of greater concern to solar companies, is a proposed change to the way customers with solar panels on their roofs are reimbursed for the excess power they generate.
As it stands, they receive credit on their power bills for surplus energy, which is sent out to other customers on the electric grid, at the retail rate a customer would be charged for using that power. The legislation would change this to the lower wholesale rate.
Fulton said the current “net metering” structure helps customers recoup the cost of installing solar systems, which typically runs “well under $10,000” after accounting for state and federal incentives.
“Net metering benefits exist for the entire life of the system,” she said.
Heart said that it wouldn’t be fair for ComEd to turn around and sell solar energy generated on someone’s rooftop to other customers at a profit.
The state needs an in-depth study of these issues before moving forward, she said.
ComEd officials say the changes to net metering are needed to cover the cost of distributing power to solar customers at times when they’re drawing more power than their rooftop panels are producing.
They also argue that their proposal would jump-start the nascent industry by creating new rebates for customers who install solar panels and investing $140 million in the purchase of renewable energy credits from solar developers.
“We are pro-solar,” said Fidel Marquez, senior vice president of governmental and community affairs. “We are pro-energy efficiency.”