The Senate Rules Committee approved a bill Wednesday allowing household-sized solar and wind power producers to continue net-metering excess power to the Water and Power Authority at retail price, but limiting larger producers to a smaller "Feed In Tariff" payment reflecting WAPA’s costs.
The bill sponsored by Sen. Craig Barshinger leaves full retail-rate net metering for producers of up to 5 KW of solar power. But systems of 5kw to 500kw would not get retail net metering, but instead a tariff set by PSC that pays producers less to account for WAPA’s avoided cost. Larger systems would be considered utility-level production and priced contractually as they arise.
"A feed in tariff is inherently a more fair business arrangement," Barshinger said, introducing the bill, which WAPA officials supported. The new system will allow WAPA to move forward on getting more distributed alternative energy onto the grid without putting itself in a bad financial position, according to Barshinger.
Net metering was capped at 15 MW territorywide in 2009, with a 10 MW cap on St. Thomas and a 5 MW cap on St. Croix. A year ago, the growth of net metering was making news but reaching the caps was still distant. Since then, St. Croix has either connected or contracted to connect about 4.1 megawatts of the five available. St. Thomas still has plenty of room.
Hodge testified during committee hearings that the caps cannot be increased without putting a physical strain on the electric grid, and that much more alternative power during the day would not save WAPA fuel and would start to cost more and more, as WAPA is forced to stop using its energy-saving waste-heat generator. Ultimately, other ratepayers have to make up the cost, subsidizing the net metering, he said.
Putting in the Feed In Tariff would help protect the grid and WAPA, while reserving nearly a megawatt of power for numerous small household producers instead of one or two large commercial operators, Hodge said during committee hearings earlier this month.
In other action, the Rules Committee approved a bill sponsored by Sen. Janette Millin Young that blighted properties in the territory’s historic areas will be eligible for a series of "Commercial Zone" tax breaks. Businesses that spend money to renovate blighted properties on Savanne-Down Street and Garden Up-Street on St. Thomas – and in Frederiksted and Christiansted on St. Croix – will be eligible for the breaks if the bill becomes law.
The goal of the bill is to find ways to encourage property owners to fix them up, ameliorating blight and making the islands more attractive, according to Millin Young.
The bill initially streamlined the process of condemnation by eminent domain, but Millin Young submitted an amendment in the nature of a substitute on Wednesday that eliminated penalties in favor of incentives. The amendment also eliminated demolition of properties, taking away the need to fund demolition. [Substitute Amendment to Bill 30-0153]
Another bill approved by Rules on Wednesday would allow potential future net revenues from licensing fees for V.I. "captive insurers," if any, to subsidize the territory’s two financially struggling hospitals.
The bill sponsored by Sens. Tregenza Roach and Alicia "Chucky" Hansen devotes whatever funds from captive insurance remain – "after all administrative expenses and documented expenses" – be split between the two hospitals. [Bill 30-0316]
“This legislation is anticipated to be a meaningful stream of revenue for our government," Roach said in a statement after the hearing. “When it comes to the public health of our people, we ought to ensure that it is an area that we address to the greatest extent that we are able to as legislators.”
He continued, “This bill, however, is not a panacea. It is not intended to replace subsidy from the General Fund. We need to continue to find ways to support our territory’s hospitals," Roach said.
While touted by Roach and others as a "reliable" revenue stream, neither proponents of the bill nor testifiers from Government House projected a dollar amount that might be generated by the measure, but they expressed hope the captive insurance market would grow in the territory in the near future, thanks to a restructuring of V.I. captive insurance regulation last year.
During committee hearings, Sen. Judi Buckley said she had looked at several other island nations to try to get some context for comparison. She said Anguilla has more than 200 captive insurers and "their revenues are upwards of $1 million a year."
The U.S. Virgin Islands has five captive insurers registered to Anguilla’s 200-plus, which, all other things being equal, would suggest proportional USVI revenues – on the order of magnitude of around $25,000 annually, unless more insurers register.
Also approved in Rules on Wednesday was legislation to:
– entitle parents and guardians with students enrolled in private, public or parochial schools to a maximum of two hours off from their jobs each month, without loss of pay, in order to visit their children, teachers, counselors or other school-related official, sponsored by Sens. Myron Jackson and Clarence Payne [Bill 30-0174];
– establish that the Department of Education must incorporate bully prevention and gang resistance education and training in all grades, sponsored by Millin Young, Buckley, Jackson, Diane Capehart, Malone and Sanes [30-0013];
– and assign health insurance payments directly to the provider, sponsored by Barshinger and Sanes [30-0253].
All bills were passed with four yea votes and three members absent. Present were Jackson, Young, Sanes and Sen. Donald Cole. Noncommittee members Barshinger and Roach were also present. Absent were Capehart, Malone and Sen. Kenneth Gittens.
The bills approved Wednesday will be forwarded to the full body in a legislative session for further consideration. If approved during the session, they will be sent to the executive branch where, upon a fourth approval, they will become law.