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HomeNewsArchivesUndercurrents: Net Metering Controversy Gets Even More Complicated

Undercurrents: Net Metering Controversy Gets Even More Complicated

A regular Source feature, Undercurrents explores issues, ideas and events as they develop beneath the surface in the Virgin Islands community.

The struggle to contain the renewable energy net metering system is looking more and more like a fight with the mythological Lernaean Hydra.

The latest troublesome head to emerge is a question of equity for tenants.

A proposal meant to promote the switch from net metering to the less generous feed-in tariff program includes a provision amending existing law to make residential customers who rent their homes as well as businesses that lease their premises ineligible for participation in net metering.

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That, says one critic, is blatantly unfair.

Attorney Jay Isherwood wrote the Legislature this week to urge the defeat of what he called “discriminatory” language in the bill.

“This amendment (of existing law) is an attempt to favor land owning businesses over less fortunate Virgin Islands businesses who lease the land or premises where their businesses are located,” he wrote. Isherwood said he has a client that leases business space and wants to be in the program.

“Many V.I. businesses occupy leased property,” he said. Many of them have long-term leases that allow for them to make substantial investments in the leased premises. “The time for recovery of the savings which will be provided by a net metering system are well within the terms of these commercial leases …

“Tenants, whether they are businesses or residential, are often not as strong financially as property owning businesses and residents, but they pay the same high utility costs and have the same need to reduce their utility bills.”

Sen. Craig Barshinger, chairman of the Committee on Energy and Environmental Protection, says non-owners will be able to participate in the feed-in tariff program.

Barshinger has spent much of his current term in office trying to reform the system and to forge a compromise between the V.I. Water and Power Authority, which says net metering is too costly, and customers who don’t want to give up its advantages.

Net metering was established in 2007 as a way to encourage people to invest in alternative energy. Customers who install wind generators or solar panels and produce their own electricity bank kilowatts with WAPA and can draw power from WAPA on a one-for-one basis.

“After a slow start, (net metering) took off like a bat out of hell,” Barshinger said. And it quickly became apparent that it was not sustainable. If everyone participated, no one would be paying WAPA for any of its operating costs.

Besides that, it would cost the utility more money to deal with the fluctuating power coming from customers. Eventually either the government would pick up the cost or the utility would fail.

By 2009, the Legislature put a cap on the program, at least temporarily: a total of 10 megawatts for St. Thomas-St. John and five for St. Croix. The program is at capacity now, although that includes some permits that haven’t yet been implemented.

There’s no question of the program’s popularity, however. The Energy Office reported in October that more than 1,000 renewable energy systems had been connected to the public grid and that, at peak demand, approximately 12 percent of the load on St. Thomas and 10 percent on St. Croix was coming from renewable sources.

Net metering was a “necessary evil” for getting the Virgin Islands vested in sustainable energy sources, but now it’s “a burden for WAPA,” Barshinger said.

The senator was successful in pushing through legislation to establish the feed-in tariff (TIF) program, under which customers can “sell” power to WAPA and then buy it back, but at a rate of roughly one-to-two. Currently the customer gets 26 cents per kilowatt and pays WAPA about 48 cents per kilowatt.

That’s still an incentive to go solar, but Barshinger says it’s also economically sustainable.

“If everyone does feed-in tariff, WAPA will still survive,” he said.

His bill would also limit the amount of alternative power a customer can supply to WAPA in the net metering program to just 10 kilowatts, but there is virtually no limit for the feed-in tariff. The intention is clearly to make net metering a program for residential customers.

Barshinger had wanted to close down net metering all together by 2025, but faced with strident opposition, he backed off and the sunset clause was removed from the bill in committee. The issue is to be sure such customers recoup their investment costs.

“My successors (in the Legislature) will have to look at that carefully,” he said. Barshinger did not run for reelection and will be leaving office at the end of the year.

The bill is scheduled for consideration in the Rules Committee Dec. 18. Assuming it is approved in committee, it will be on the agenda of a Senate session Dec. 19.

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