In the fight over preserving net metering, the electric industry’s war on solar, declared in 2013 by the Edison Electric Institute, has come to the WV Legislature. The war has come in the form of two vague and misleading words, “cross-subsidization”.
As House Bill 2001 moved through the Legislature early in the 2015 session, another bill, HB2201 was introduced. HB2001 repealed the do-nothing ARPS law that was put in place by then-Gov. Manchin and the coal industry in 2009, but preserved the section of the law that authorized the WV PSC to institute net metering in WV.
HB2201 attempted to add a definition of net metering back into the newly constituted net metering law preserved in HB2001 . However, that definition was slightly modified to add new restrictions on which solar power producers were eligible for net metering. This modification, which changed an “or” to “and” from the definition of net metering which had been in another section of the ARPS law, signaled that AEP and FirstEnergy, the two Ohio-based holding companies that control WV’s electrical system, were going to use HB2201 to perform stealth attacks on net metering that most legislators thought they had “saved.”
When HB2201 passed out of the House, Del. Folk, a Republican from Berkeley County, successfully added an amendment to the bill which read:
The [Public Service] commission shall assure that any net metering tariff does not create a cross-subsidization between customers within one class of service.
This was the first time the words “cross-subsidization” had crept into the policy discussion about net metering in WV. The word “subsidization” is part of the power industry’s propaganda lexicon in its fight against solar power. It is a buzzword implying falsely that solar power needs subsidies to compete “in the marketplace” with fossil fuel power, which is portrayed as requiring no subsidies.
This characterization is particularly ironic in WV considering that the WV PSC has just saddled WV rate payers with huge subsidies to protect AEP’s Mitchell Plant near Moundsville and FE’s Harrison Plant near Clarksburg from having to compete in wholesale energy markets with lower priced alternatives. The Legislature did its part in 2013 by dumping responsibility for AEP’s failed fuel choices in 2008 onto the company’s rate payers in the form of decades of bond payments to cover AEP’s coal costs with the deceptively named “consumer relief charge.”
Del. Folk’s “cross-subsidization” now joins “free loader” and “standby charges” and all the other propaganda that has been used by power companies in their fights against solar power in Republican-controlled states like Arizona, East Virginia and Wisconsin.
Throughout all solar advocates’ attempts to remove the cross-subsidization language from HB2201, power companies and legislators resisted any change. In fact, the Senate added a definition of cross-subsidization to the bill which only made matters worse.
To be clear, HB2201 does not direct the PSC to make any changes to its rules concerning net metering. Nor does the bill require power companies to make any changes in their current rate tariffs. But the bill does create a legislative directive that could be used the AEP and FE to push for those changes in the future.
The possibility of an attack on net metering is essentially the same as it has always been. The Ohio holding companies could have tried to add fees or change the way power producers are compensated in the base rate cases both companies filed at the PSC in 2014. They chose not to attack in those cases, which indicates that attacking net metering is not a high priority for them, right now.
I have personally heard FirstEnergy’s lobbyist tell two different legislative committees that his company only intends the cross-subsidization language to apply to larger solar power systems that might require power companies to change their equipment for interconnection. When solar advocates lobbied legislators to reflect these statements in changes to HB2201, both FirstEnergy and AEP refused to support the changes. That is an indication that FirstEnergy is not willing to stand behind the verbal assurances of its lobbyist and may have other things in mind for the future.
So, with HB2201, the WV Legislature has created a classic case of regulatory uncertainty that now hangs over the entire solar power industry in our state. Hundreds of WV citizens and businesses have made millions of dollars of investment in our state which is now at risk because of sloppy legislating and power company power plays.
West Virginians have one more chance to stop this attack on our state’s future. Click here to send an email to Gov. Tomblin asking him to veto HB2201 when it crosses his desk in the coming week. Send your email now, because time is limited. You can also call the Governor’s Office on Monday morning at 304-558-2000.