As net metering debate continues, report shows benefits of solar energy far outweigh costs

Solar panels deliver benefits to the electric grid and to society at large that are greater than the compensation their owners receive through net metering, according to a report released today by the Environment Massachusetts Research and Policy Center.

“Opponents of solar energy are trying to keep us in the dark, but today’s report will shed light on the truth about solar,” said Ben Hellerstein, State Director for Environment Massachusetts. “Solar is a good deal for our environment, our economy, and electric ratepayers across Massachusetts.”

The report, Shining Rewards: The Value of Rooftop Solar Power for Consumers and Society, analyzes 11 studies on the benefits and costs of solar and concludes that net metering is a fair way to compensate solar owners for the value they provide. It comes as the standoff over the state’s net metering program approaches its fourth month.

Net metering allows solar panel owners to receive full compensation for the electricity they provide to the grid. In March, a cap on the program was hit for about half of the towns and cities in Massachusetts. As a result, many businesses, local governments, and nonprofits hoping to install solar panels are no longer able to do so.

“Diversifying our energy sources and increasing solar capacity will help maintain jobs, benefit ratepayers, and combat climate change,” said Attorney General Maura Healey in a written statement. “This report adds to the growing body of research showing that solar power and net metering are a positive for customers across the country.  It's imperative that we keep the growth of solar going by lifting net metering caps and designing rate structures to reflect the full value that solar customers provide to the grid.”

Utility companies have opposed raising the net metering caps, claiming that solar imposes costs on the grid and other ratepayers.

Shining Rewards shows that the benefits of solar energy are much greater than the costs. All of the studies reviewed in the report showed that solar offered net benefits to the electric grid and to society. These benefits include lowered demand for electricity from the grid at times when the price is higher, avoided investments in costly transmission and generation infrastructure, and reductions in global warming emissions and other harmful forms of air pollution.

Moreover, every study authored by an independent organization or public utilities commission has concluded that the benefits of solar exceed the amount that solar owners are paid under net metering. This finding suggests that net metering is a fair way to compensate solar owners for the value they provide to the grid — and, if anything, may be undercompensating them.

One of the studies, authored by Acadia Center, showed that a typical rooftop solar installation in Massachusetts offered benefits to the grid and to society at large of 29 cents per kilowatt-hour (kWh), compared to the state’s average retail electricity rate of about 17 cents per kWh.

“Solar lowers a wide range of costs in the electric system, by decreasing effective demand at peak times when wholesale electric prices are highest, reducing the need to build expensive transmission infrastructure and new power plants, and lessening our exposure to volatile fossil fuel prices. This will make electricity bills more affordable over time.” said Mark LeBel, Staff Attorney at Acadia Center. “When you add these extensive ratepayer benefits to the environmental and public health benefits and local jobs, it’s clear that distributed solar generation is one of the best energy resources we have.”

Solar energy grew by an average of 127% per year in Massachusetts between 2010 and 2013. In 2014, Massachusetts installed enough solar capacity to power 50,000 homes with clean energy.

Massachusetts’ solar industry now supports more than 12,000 jobs. More people work in the solar industry in Massachusetts than in any other state except California.

“Nexamp has seen the adoption of solar power driven by a growing customer desire to reduce energy costs and support renewable energy sources,” said John Murphy, Director of Corporate Development for Nexamp. “Policies that continue to enable local governments, residents, businesses, and nonprofits to achieve these goals should be a priority for policymakers.”

In April, more than a hundred people gathered at the State House for the Stand Up for Solar lobby day and asked legislators to raise the net metering caps and commit to ambitious solar goals. Lobby day participants delivered letters signed by more than 350 city and town officials, 560 small business leaders, 52 solar industry leaders, and 25 environmental organizations asking Governor Baker to support a goal of 20% solar by 2025.

Officials in Governor Charlie Baker’s administration have said that they do not support an immediate increase in the net metering caps.

“They say sunlight is the best disinfectant,” said Hellerstein. “Now that the facts about solar have seen the light of day, let’s hope our state officials feel the heat to do something about it. Lifting the net metering caps and committing to a goal of 20% solar by 2025 is a good place to start.”