Ill. solar in limbo with funding loss, net-metering win

Source: By Jeffrey Tomich, E&E News reporter • Posted: Monday, December 7, 2020

The solar industry notched a win last week when Illinois regulators ordered the state’s second-largest utility to continue net metering.

But the victory Wednesday was short-lived. Two days later, the Illinois Power Agency announced that incentive funding for distributed generation systems — a key driver of rooftop solar growth — in Ameren Illinois’ service area had run out.

The net result will be a slowdown in solar installations across central and southern Illinois as the state continues to fall well short of renewable energy goals adopted more than a decade ago.

Renewable energy advocates said both net metering and the incentive program are “critical needs” for Illinois, which has a goal of getting 25% of its energy from renewable resources by 2025. Currently, the state’s two big utilities, Ameren Corp. and Commonwealth Edison Co., are on track to get just 8% of their energy from renewables by middecade.

Brad Klein, an attorney for the Chicago-based Environmental Law and Policy Center, said the Illinois Commerce Commission’s net-metering order buys time for the industry, regulators and utilities to work toward a longer-term solution for how solar owners are paid for excess generation. Net metering compensates solar owners for excess power based on the same retail rate a resident pays a utility for electricity.

In the meantime, Klein said it’s urgent for the Legislature to address the lack of incentive funding.

“That’s absolutely necessary for how Illinois needs to meet its RPS [renewable portfolio standard] targets,” Klein said. In addition to the 25% renewable goal, Illinois also has specific policy carve-outs for solar energy and distributed generation.

While some funding remains for small distributed generation projects in ComEd’s service area in and around Chicago, it’s expected to run out this month. And incentives for larger wind and solar projects are already exhausted.

The solar industry has been warning for the last two years about an approaching funding “cliff” (Energywire, June 11). The Legislature was expected to take up competing energy proposals this spring to help boost renewable energy deployment, but the session was cut short by the pandemic. The recent spike in COVID-19 cases also led to cancellation of a fall “veto session” typically used to iron out conflicts with the governor.

Nakhia Morrissette, central region director for the Solar Energy Industries Association, called on legislators to move swiftly to protect jobs created by the 2016 Future Energy Jobs Act (FEJA), the law that established the solar incentive program.

“Thousands of people across Illinois have launched careers, trained workers and invested in renewable energy based on a program that has now ceased to function,” Morrissette said in a statement.

Friday’s notice that solar incentive funding has run out for customers in Ameren’s service area overshadowed Illinois regulators’ earlier rulingconcerning a contentious dispute over the state’s net-metering law.

Under FEJA, utilities must offer net metering to residential and small commercial customers until distributed generation capacity reaches 5% of peak demand.

When that threshold is reached, Illinois law requires that net metering be replaced with a rebate.

For weeks, Ameren and the solar industry have sparred over how the 5% trigger is calculated (Energywire, Oct. 5). At issue is whether the number includes customers that buy energy from an alternative provider, and whether it includes community solar projects.

Commissioners voted 4-1 in favor of the solar industry’s interpretation of the law, which requires Ameren to offer net metering.

Ameren spokespeople didn’t respond to a request for comment on the ruling.