Solar Advocates Say New Installations Would Lower — Not Raise — Electricity Prices For Mainers

Dec 28, 2020

Last year Maine’s Democratic Legislature and governor enacted a grab bag of programs aimed at bringing more solar power online.

The new legislation produced some quick, high-value projects, some duds, and a debate over what lessons lawmakers should bring into the next legislative session.

Last month, Maine’s Public Utilities Commission released a report finding that if all of the small- to mid-size commercial and “community” solar projects on the table were to actually be built, the state’s major utilities could lose up to $160 million a year in revenues, a cost that would be passed on to electricity consumers.

But solar industry advocates say those numbers are vastly exaggerated, and they are pointing to another recent analysis that tells another side of the story.

“What the analysis shows is that there are clear monetizable benefits to all ratepayers of behind-the-meter solar,” says Fortunat Mueller, co-founder of ReVision Energy, Maine’s largest solar installer.

Mueller says a recent report by Cambridge-based consultant Synapse shows that over a 5-year period, new solar projects in the region saved consumers more than a billion dollars, including $68 million in Maine.

“And unlike the PUC’s report, which is sort of a 20-year guess at what those costs will be, this is actual savings over the last five years, from actual systems,” he says.

So-called “behind-the-meter” solar power systems can save money by reducing the amount of electricity that transmission utilities need to buy from the regional energy grid.

Any big reduction in demand — or increase in supply, for that matter — can lower wholesale energy prices.

“Any large resource that’s brought on the system will reduce prices. So that, that’s fairly typical,” says Portland attorney David Littell, a former Maine regulator who now consults with governments and industry on energy issues. “What you see with solar is you see several effects. Where solar is not just reducing the price from the new resources brought on the system. It’s also reducing the price during a key time in the day, when the prices are highest. Our summer peak time is still the highest-price time of the year for New England.”

And advocates argue that there are other benefits from solar energy such as job creation and improving reliability by diversifying the number, location and scale of the grid’s energy sources. And they argue that it can reduce transmission and distribution costs by keeping a source of energy generation physically close to the users who need it.

But perhaps most important, the new report finds, is the renewable resource’s ability to reduce pollutants that harm human health and drive global warming. It estimates the value of New England solar’s contributions toward that effort at more than $600 million over the past five years.

“Over the course of the next 20 years, Maine should be building about 250-300 megawatts of solar every single year over the next 20 years,” says Mueller — enough new solar to power tens of thousands of homes or new electric cars, and make it realistic to reach the state’s goal of carbon-neutrality by 2045.

But some question the state’s “net energy billing” incentives, which give the small- and mid-size solar generators retail-priced credits for excess power they supply to the grid.

“We have to accept the principle of doing climate based on price efficiency,” says Tony Buxton, a lobbyist for the Industrial Energy Consumers Group.

Buxton is laser-focused on the price side of the equation. He says the state should focus on larger-scale projects that can produce solar energy at a lower cost without depending on bill credits.

“We need to do far more than we’re doing. And we won’t be able to afford it if we aren’t careful about what we spend. When you spend five times as much for solar, you can buy only one fifth as much solar,” he says.

Buxton, who keeps his client list confidential, raised hackles in the environmental community recently when he called the surge in incentivized solar projects a “climate mistake.”

The debate will resurface in the new year, as lawmakers revisit their renewable energy policies, seeking lessons learned and refinements.

Rep. Seth Berry, who co-chairs the Legislature’s energy and utilities committee, says he will introduce a bill that would press the pause button on new net-energy-billing projects above two megawatts, but would preserve the system for smaller arrays.

“I absolutely do not believe that we need to get away from net energy billing. I believe net energy billing remains a good deal for all of us. But there may be some limited areas where NEB is not the right tool for the job,” he says.

Even before the Legislature convenes, it’s expected that more studies of the true costs and benefits of solar power will emerge.