Fla. solar proponents wrestle utility ‘poison pills’

Source: Kristi E. Swartz, E&E reporter • Posted: Thursday, January 14, 2016

TALLAHASSEE, Fla. — The future of Florida’s rooftop solar market remains murky despite continued optimism from clean energy advocates who have been fighting for years to strengthen it.

There was clear evidence of the tug of war yesterday as backers of a proposed constitutional amendment to create a market for rooftop solar announced they are targeting the 2018 ballot instead of 2016. For now, Floridians for Solar Choice will put all of its money and political muscle behind killing a utility-backed solar proposal — also slated for voters — that needs to clear the Florida Supreme Court.

Briefs on that ballot measure, sponsored by Consumers for Smart Solar, were due by midnight.

Two lawmakers have taken the Floridians for Solar Choice ballot language and turned it into House and Senate bills. The Florida Legislature’s 2016 regular session starts today, but there’s already plenty of chatter that clean energy legislation has an uphill battle ahead.

A couple of proposed constitutional amendments and associated bills that would exempt commercial and all real property from being taxed on renewable projects are moving swiftly through House and Senate committees. One set (S.J.R. 170/S.B. 172) passed the Senate Finance and Tax Committee yesterday afternoon.

At this pace, they could go before the full chambers soon, which is unusual for renewable energy legislation in Florida.

“I’m more optimistic about the tangible personal property tax,” said Stephen Smith, executive director of the Southern Alliance for Clean Energy. “I think it is the thing that has the higher probability.”

Should either of the House and Senate bills on rooftop solar be assigned to respective committees, they likely will be changed several times by lawmakers. Bill supporters said they expect the utility industry to weigh in heavily.

“You will have a lot of poison pills,” said Tory Perfetti, chairman of Floridians for Solar Choice, at a morning news conference. “There will be a lot of things that will degrade the capabilities of people who buy solar.”

This is Florida’s rooftop solar landscape in a nutshell. The picture is different when it comes to utility-scale solar, however. The state’s large investor-owned utilities are more willing to add solar from large arrays to the grid because it makes more economic sense.

The falling cost of solar panels has driven growth in other states and the Southeast, where the cost of electricity is often cheaper than in other parts of the country. Florida still has a harder sell to add solar power because its monthly electric utility bills are lower, and the state gets the bulk of its electricity from natural gas, which is cleaner than coal.

Florida now stands out in another way. It is one of the few holdouts in adopting any sort of policy that can encourage or at least make it easier for consumers to finance solar panels to alleviate pricey upfront costs.

The state does let rooftop solar generators sell back any excess power at a 1-to-1 retail rate, but it’s questionable how long that policy will remain.

‘Reality’ in the Sunshine State

Utilities argue that creating a robust market for distributed solar generation in Florida would lead to cost shifting. In other words, non-solar customers would end up paying for fixed costs of the grid, while rooftop solar users would enjoy lower utility bills.

Leon Jacobs, former chairman of the Florida Public Service Commission, calls the utility’s arguments over subsidies “disingenuous.”

“It’s an unfortunate reality that the industry has viewed the presence of solar as a threat to its business model,” he said. “If a customer uses solar, that he imposes some kind of harm to the rest of the users and ratepayers as a whole, is absolutely incorrect.”

Other states are cultivating clean energy industries, and much of that growth, including jobs, is coming from private businesses, Jacobs said.

“So how long are we going to be held to the minimum standard of what solar can really do and can really be in the Sunshine State?” he said, using the state’s official nickname, which frustrates the utility industry and many of the current PSC members.

Some lawmakers have noticed Florida’s odd dance with solar. In supporting the tangible personal property tax bill, Rep. Darren Soto (D) said the state has fallen behind on spurring solar development.

“We should encourage individuals and businesses to develop solar so we can keep up with other states,” he said.

The state is home to three regulated, investor-owned utilities — Duke Energy Florida, Florida Power & Light Co. and Gulf Power Co. — that have associated companies that have significantly expanded solar in other Southeastern states and across the country. Duke Energy helped negotiate North Carolina’s renewable energy standard and was part of the wide-ranging compromise for solar in South Carolina, for example.

FPL’s sister company, NextEra Energy Resources, is one of the largest solar generators in the United States. Gulf Power’s parent, Atlanta-based Southern Co., has evolved into a significant owner of utility-scale solar. Its Georgia Power subsidiary boasts a goal of having 1 gigawatt of solar on the grid by the end of this year.

“That is because they have adopted good policies,” said Smith at SACE. “They are bringing in economic development.”

He remains optimistic for policy change in Florida.

“I believe that the elected officials of Florida are smart, and they are paying attention,” he told EnergyWire, touting the support for the ballot initiatives. “They have seen that over 1 million people in the state of Florida have signed a piece of paper wanting to see more solar in the state.”