On Thursday, February 9, the State Senate Utilities committee is set to hear Senate Bill 309, which deals with the issue of the distributed generation of power in this state.
On the surface it may seem like a bill full of technical mumbo jumbo that shouldn't concern the general public. But the public should be concerned about the details of the bill and many are, especially residents, businesses and industries that are concerned about and invested in clean renewable energy.
The bill, authored by Sen. Brandt Hershman, would require public utilities to end the net metering tariff for customers by 2027 or "until the first calendar year after the aggregate amount of net metering facility nameplate capacity under the tariff equals at least 1 percent of the electricity supplier's most recent summer peak load," whichever comes first.
And according to industry watchers, that timeline could be moved up to three or four years.
While that may sound confusing — believe me, it is —the bottom line is that the bill seeks to reverse some of the provisions put in place by the Daniels Administration and the 2011 state legislature to help create an investment climate for business and industry interested in wind and solar power.
And, for an administration like that of Gov. Eric Holcomb, who has made economic investment and creating a business-friendly environment in Indiana — well, let's just say that the bill is bad for business.
Net metering allows utility customers who generate their own power to essentially "sell" any power they don't use back to the public utility at a retail price — which in turn results in a discount of sorts on their bill for power they do get from the utility company. Customers essentially get to use the power they have generated themselves, through wind or solar, at a later date for no additional cost.
For example, a typical 10 kW-h home solar installation will produce 55 kW-h of electricity on a sunny day. The average home uses about 40 kW-h each day. So on those sunny days the customer sells the extra 15 kW-h of electricity back to their public utility. When they use power from the utility on a cloudy day, 15kW-h of electricity is discounted from their bill. That's net metering.
So, what happens when net metering ends? The customer sells the 15kW-h of electricity to the utility at wholesale, but then has to pay the retail price when it is used at a later date. That's like selling a scarf you knitted yourself for $5 only to turn around and buy it back for $10.
Net metering doesn't just affect residential homes and small businesses with rooftop solar panels. The 2011 legislation also increased the total service kW-h from 10 to 1000kW-h, opening up the opportunities for large businesses, commercial properties and industries to create their own power as well. And the results have been prosperous for the state.
There are numerous large corporations and industries that have made renewable energy sources part of their strategic plan and look for strong investment climates when deciding where to locate. For example, Amazon has a specific plan for 100 percent sustainability for the company with a long-term step-by-step plan of how to get there. According to the company's website, Amazon was on track to exceed its goal of generating 40 percent of its own power by the end of 2016 and has a goal of 50 percent for 2017. To achieve this goal, the company as created several wind and solar farms in the same states where its warehouses are located. Amazon operates four fulfillment centers in Indiana — Indianapolis, Plainfield, Whitestown and Jeffersonville — which created much-needed jobs. Amazon also built a wind farm in Benton County, Ind. outside of Fowler. The 65 wind turbines generate power that is supplied to Amazon data centers that is the equivalent of powering 46,000 homes per year.
Amazon currently has a 13-year purchase agreement to supply power from its wind farm to its data centers. Could the terms of SB 309 put that agreement and the future of Amazon's business and jobs in Indiana in jeopardy? Anything's possible, especially when other states are competing for that business and are creating better climates for investment.
"The trend that is happening in other states is that this is a promising industry and we've got to figure out, how do we make our climate better for this technology," Hoosier Environmental Council executive director Jesse Kharbanda says. "So they have gone beyond one percent and gone to two, three maybe even five percent. And they have gone from maybe a one-megawatt (1000 kilowatts) limit to essentially an unlimited commitment. "
Businesses with interests in the investment climate of Indiana are prepared to testify at the committee hearing. Hoosier Interfaith Power and Light is rallying its membership to attend the hearing to voice concerns for the bill and champion renewable energy in the state. The hearing is scheduled for 9 a. m. Thursday in the Senate chambers.