After months of contentious debate over solar-power expansion, Duke Energy has agreed to reinstate temporarily a solar program that pays favorable rates for new customers wanting to install rooftop sun panels as a way to save money.
The utility reached an agreement this week with environmentalists and solar-energy advocates to extend the favorable rates until March 15.
The program, known as net-metering, makes it easier for customers to afford money-saving solar panels on their roofs. Favorable payments from the utility for power generated by rooftop solar panels often lower homeowners’ monthly power bills.
The state Public Service Commission must sign off on the deal.
Duke’s action this week follows a bitter fight in the Legislature last spring between solar-power advocates and the giant utility over whether to eliminate a cap on the expansion of solar power in the state. The utility led the charge against eliminating that cap, winning the legislative dispute on a technicality even though most lawmakers voted to eliminate the cap.
Duke’s Upstate service area reached a cap on rooftop solar power earlier this summer, and the utility began efforts to eliminate the favorable rates it pays homeowners. SCE&G, which serves the Columbia area, is expected to reach the cap early next year.
After reaching the cap, utilities no longer have to offer net-metering, which provides favorable rates, for new residential solar customers.
The extension agreed to this week keeps the net-metering program going while Duke and solar-power advocates work toward a compromise that could allow solar power to expand under rules acceptable to both sides. Sun-power backers stressed that it’s vital to reach a compromise on solar expansion during the next six months. Duke said it will work toward that goal.
“We believe this temporary extension of net metering will provide consistency and certainty for customers and the renewable energy industry in South Carolina, while Duke Energy and other interested stakeholders develop recommendations for consensus, common-sense policies that are fair and balance the interests of all who call South Carolina home: solar providers, energy companies and customers who use solar energy — and those who do not,’’ Duke spokesman Ryan Mosier said in an email.
Utilities have been reluctant to embrace solar energy because it can cut into their profits. Utilities also have said the favorable rates paid solar customers are subsidized by non-solar customers, which solar advocates dispute.
Solar power is a growing way of providing energy at lower costs for many customers. Customers typically rely on solar panels to provide power during the day while buying traditional forms of energy from utilities at night. But customers often produce more power than they need and are compensated by utilities. A key issue is whether customers should pay the utility the same rate for traditional power that utilities pay customers for solar energy produced from rooftops. Utilities prefer to pay less for solar than they are paid for producing power.
The agreement to temporarily continue the net-metering program, dated Sept. 4, says Duke and the interest groups will seek approval from the S.C. Public Service Commission to sign off on their plan. The deal with Duke was agreed upon by an array of groups, including the S.C. Coastal Conservation League, the Sunrun solar company, Vote Solar, Upstate Forever, the Southern Alliance for Clean Energy and the S.C. Solar Business Alliance
Vote Solar’s Thad Culley and Matt Moore, who heads Palmetto Conservative Solar Coalition, said the deal gives new solar customers a reprieve until a long-term deal can be worked out. The S.C. Office of Regulatory Staff, which represents consumers’ interests in dealings with utilities, led efforts to reach the temporary deal, they said.
The deal also saves jobs of people involved in the solar industry, even though some jobs already have been lost by Duke’s decision earlier this summer to discontinue the program, industry officials said.
“The lack of a long-term solution has forced Sunrun to significantly downsize in the Upstate, including closing our branch in Greer,’’ company regional executive Tyson Grinstead said in an email. “We hope policymakers will act in the 2019 legislative session to bring jobs and energy choice back to the state before companies are out of options.”
Moore said a long-term solution is needed because many S.C. residents favor the expansion of solar power.
“Duke hitting the net-metering cap shows how much demand there is for residential solar in South Carolina,’’ Moore said. “Legislators would be wise to recognize that fact and pass a permanent solution.’’