Clean energy groups including Vote Solar say Ameren Illinois has proposed a critically flawed plan to compensate its solar customers, threatening Illinois’ clean energy transition.
On Feb. 5, the Environmental Law & Policy Center, Vote Solar and the Natural Resources Defense Council filed testimony in the Illinois Commerce Commission’s ongoing investigation into compensation for Ameren solar customers. In the testimony, energy expert Curt Volkmann called Ameren’s proposal for how to compensate solar panel owners for the energy they provide the grid “overly complex and opaque, flawed, and too narrowly focused.”
The core issue is how the utility plans to compensate solar panel owners after full retail net metering ends. When solar panels on homes, schools, churches and businesses in Southern and Central Illinois generate more power than the building uses, those excess electrons go back to the grid. Ameren then sells this electricity to other customers.
Under state law, Ameren must compensate solar panel owners the same amount they charge other customers for the power, a 1:1 reimbursement rate called “full retail net metering.” That’s a foundational policy the General Assembly created to spur investment in clean power and help Illinois meet its clean energy goals.
Once distributed solar generation makes up 5% of Ameren’s overall load, the utility — with ICC approval — can set up a new, more sophisticated compensation plan, one where Ameren must provide rebates to their solar customers for the value they provide to the grid.
“If Ameren is unwilling or unable to show their math on the value they offer local solar customers, Illinoisans will have no reason to trust that they are getting a fair shake. Customers must be fairly compensated for the benefits they bring for the grid,” said Will Kenworthy, Regulatory Director, Midwest for Vote Solar. “And the Commission must be confident that the calculations are just and reasonable, but they can’t make that judgement without transparency.”
The clean energy groups behind Friday’s filing scored a major win in December. By a 4-1 vote, the ICC found that Ameren was not correctly implementing the law, and therefore artificially accelerating their transition from net metering to rebates. The Commission’s decision made it clear that the transition is about two years away. Clean energy groups argue that Ameren has time to carry out the work necessary to develop a compensation framework that is complete, fair, and compatible with Illinois’ clean energy goals and growing solar market.
Friday’s filing outlines several recommendations for Ameren and the ICC to help create that plan, including:
- Conduct a complete “Value of DER” study. With new technologies like battery storage and home electric vehicle charging changing the definition of renewable energy, any plan that only looks at the short-term “capacity” value of solar is flawed from inception. The ICC should order Ameren to begin working with staff, stakeholders and an independent third-party facilitator to conduct a comprehensive and transparent analysis of the full value of all these “distributed energy resources” to the grid. Ameren can’t compensate fairly if they don’t know the real value of clean energy.
- Create a transparent process for developing and updating rebates. Ameren’s plan proposes several different up-front rebates that will help customers with the initial set-up cost of solar, but the process by which those rebates will be calculated and updated created remains opaque. Simply, Ameren isn’t being forthcoming with the rebate value that solar owners, or prospective solar owners, would receive. The ICC should order Ameren to create a transparent process so customers can be assured their rebate was calculated fairly.
“Ameren should go back to the drawing board,” said Environmental Law & Policy Center Staff Attorney Nikhil Vijaykar. “Its narrow proposal risks ignoring a lot of the value that DERs can provide to the grid.”
News item from Vote Solar