A controversial bill that would make it less financially attractive to install solar energy panels in Kentucky is going to the full House after it overwhelmingly was approved Thursday by the House Natural Resources Committee.
House Bill 227 would dramatically roll back the reimbursements paid to future homeowners with solar panels on their roofs when they sell surplus energy to utility companies, a practice known as “net metering.” Instead of getting the retail rate, homeowners would get the much lower wholesale rate.
Solar panel installers say the smaller payments could mean that homeowners would need 20 years to recoup the cost of putting panels on their roofs — an average of $20,000 — instead of the current nine years.
“This bill is essentially killing residential solar energy and allowing the utility companies to maintain a monopoly,” Jamie Clark of Synergy Home in Lexington said after Thursday’s committee vote.
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“I’ve said many times, if Time Warner Cable could go back 30 years and make it illegal to put a satellite dish on your roof, that would be their business model. That’s effectively what this bill is doing for the utilities,” Clark said.
However, committee chairman Jim Gooch, R-Providence, the sponsor of the bill, said the current payment model is unfair because it forces utility companies to pay homeowners three times as much as their excess electricity is worth.
Utilities have fixed costs included in their retail energy prices, such as employees, infrastructure and debt service, Gooch said. But a homeowner with solar panels does not have those costs and does not need to be reimbursed at that high a rate, he said.
Kentuckians already participating in net metering would see no changes for 25 years under the bill, Gooch said. For future participants, the new rules would take effect in July.
The state’s major utilities, including Kentucky Utilities and Louisville Gas & Electric, have endorsed Gooch’s bill.
The committee heard testimony on the bill Jan. 31, but Gooch did not allow a vote until Thursday, after he had added three new members to the committee with the permission of House Republican leaders. While opponents of the bill protested that move, the vote was not close: Fourteen members voted to send the bill to the full House, four voted against it and four abstained.
Several Republican lawmakers who voted for the bill in committee said they have concerns with it and pledged to amend it on the House floor to make it fairer to homeowners with solar panels.
“I think this bill gives too big of a haircut to the solar companies and to the solar user. But I think its intentions are correct in trying to correct some of the fixed costs that are not being covered right now,” said state Rep. Jim DuPlessis, R-Elizabethtown.
Voting against the bill, state Rep. Kelly Flood, D-Lexington, said her House colleagues should be embarrassed about “bringing a sledgehammer” against the nascent solar energy industry, which is creating hundreds of middle-class jobs across Kentucky. And state Rep. Reginald Meeks, D-Louisville, said lawmakers should be embracing renewable energy.
“Solar is going to be part of the future,” Meeks said. “We can’t live in the past. But we seem to be comfortable doing so.”
There are 2,177 solar-powered homes in Kentucky, according to the Solar Energy Industries Association. Only 0.05 percent of the state’s electricity comes from the sun, the group says.