If you care about climate change and are a homeowner, you are probably considering rooftop solar on your house. But how long should it take for a residential rooftop solar investment to pay itself back? In most places around the United States, it takes 8 to 15 years. The same was true for Idaho residents. However, as a result of the Public Utilities Commission’s recent final “net metering” decision, that time period has nearly doubled. What’s worse, this decision that changes how Idaho Power accounts for your electricity generation and usage (aka ‘net metering’) is retroactive back to 2019!
This decision is part of a long-running attempt by Idaho Power to curtail the expansion of residential solar that many outlets have written about (Idaho Statesman, Idaho Capital Sun). To say this is a saga is an understatement. And to say Idaho Power is the only utility with this strategy is incorrect; this pattern of investor-owned utilities kneecapping the residential solar industry is widespread. Why? Because as energy monopolies, any competition—even in the form of nascent residential solar programs—cut into their bottom line.
I’ll spare you all of the details in this long saga; you can read our previous blogs and media on “net metering” and other rooftop solar issues spanning years. But below, we will dive into some key dates and happenings on the issue.
- 2012: At this time, when there were only 350 net metering customers, Idaho Power still wanted to make things harder for solar owners.
- 2017: ICL raises the alarm for how Idaho Power’s net metering proposal punishes customers for doing the right thing.
- 2018: ICL asks climate advocates to take action on Idaho Power’s case before the Public Utilities Commission considers changes to net metering.
- 2019:The Public Utilities Commission outright denies Idaho Power’s request to change net metering until a solar study was conducted. At this point, there were about 4,000 solar customers in Idaho Power’s service territory.
- Summer 2022: Knowing that Idaho Power would be re-submitting a net metering request (and attempting to lower the value of solar), ICL raises public awareness through a blog series on solar energy in Idaho.
- October 2022: The Value of Distributed Energy Resources (VODER) study that was contracted out from Idaho Power is released. ICL voices initial concerns that the study severely undervalued customer-owner solar resources.
- November 2022: ICL staff writes up and submits an explainer of Idaho Power’s newly amended net metering case to the Public Utilities Commission using information from the VODER study.
- June 2023: ICL does a deep dive into the most recent proposed changes to net metering from Idaho Power, explaining how there are better ways to integrate distributed energy that are fair to both the company and customers.
- January 2024: The final Public Utilities Commission makes a net metering decision that is heavily in favor of Idaho Power, ending the saga with bad news for Idaho climate advocates and residential solar owners.
The even shorter version of this ‘net metering’ saga is that residential solar installations were increasing over the last few years, expanding to about 2% of Idaho Power customers in 2022. As of 2017 there were only 1,000 residential customers, in 2022 it was about 12,000 customers capable of generating ~85 MW of capacity. Despite their limited presence, Idaho Power kneecapped the industry by (1) shrinking the payments customers receive from the power they generate on their roof, and (2) giving themselves the ability to change those payments every single year. That second change creates uncertainty in a long-term investment, asking the question—will it take 10 years or 30 years for the investment in rooftop solar to pay off? It’s hard to say, and the yearly adjustments to solar pricing will in part depend on volatile fossil fuel price spikes. Despite the Idaho Public Utilities Commission receiving ~850 comments on this net metering issue, most of which were in favor of keeping the program unchanged, the Commission stood by its stance that financial compensation to solar owners was never intended to incentivize installment. In the face of climate change where rapid decarbonization is overwhelmingly financially and environmentally prudent, we think this is a poor policy choice.
Rooftop solar owners aren’t the only ones feeling the squeeze. Residential solar installation companies are often locally-owned small businesses, and there is [was] great potential for the residential scale solar industry in Idaho to expand. The more solar on rooftops means we need fewer transmission lines and fewer utility scale energy projects. However, even in high rooftop solar build-out scenarios, they would generate ~40% of our current energy demand but only ~13% of our 2050 energy demand. The unfortunate reality is that we cannot satisfy our current or future energy needs without utility scale wind and solar projects, but we could have lessened their impacts with the expansion of rooftop solar.
There are other changes that occurred in this net metering decision (for example, commercial/industrial customers and farmers saw positive changes that will make solar installations more favorable for them), but we’ll leave those aside for now and take a step back. This decision will likely strangle the expansion of a rapidly growing job sector, and prevent everyday people who want energy independence from achieving autonomy and limit it to those who can afford it outright.
This is a frustrating conclusion for ICL and our many valued colleagues who fought, argued, and showed up for clean power and energy democracy over the years. But in the end, the outcome was unsurprising. The PUC has made clear that its prerogative from the State is to act strictly as an economic regulator. And to its credit, the PUC and power companies have offered Idaho generally affordable and reliable power, and allowed strides toward a decarbonized grid. But a strict economic lens will no longer do. Unequivocally, the costs of fossil fuel emissions are known and knowable, and they are terrifying. Idaho’s political branches do not recognize climate change and so its agencies must act in ignorance of the defining issue of our century. As scientists have overwhelmingly warmed for decades, this is catastrophically shortsighted.
We must decarbonize as fast as possible. We must recognize that our energy system is a primary driver of climate change. And we must use every tool we have to address this crisis. ICL will continue to press state policy makers to acknowledge their role in our new reality—and work toward climate solutions that are just, equitable, and protective of the people, places, and wildlife throughout Idaho.
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