By Tony Wittkowski | Business Reporter | The Herald-Palladium
LANSING — The bill introduced by state Sen. John Proos on energy policies is getting a rough reception from a former state representative from Berrien County.
Berrien County Trial Court Judge Charles LaSata is in disagreement with SB 438, which would make major changes to Michigan’s net metering programs. Net metering allows users to receive credit toward their electric bills for the solar energy they generate.
“There’s been a great deal of discussion about the future of reliable power and energy efficiency programs in the state,” Proos said. “Manufacturers require consistent and available power that is uninterrupted and reliable to ensure their process is as cost effective as possible. The goal was to create an energy policy as flexible as we could with the impending coal plant shutdowns in Michigan.”
If implemented, the bill would replace net metering programs with a distributed generation program where customers could generate up to 110 percent of their average annual electricity consumption. Instead of utility companies giving customers credit for what’s generated from solar power, customers would pay for their electric use in advance and sell back what they generate to the utility company at a wholesale rate.
LaSata, who generated 100 percent of his power through solar panels last year, said the bill would make solar power unaffordable for residents.
“The cost of solar panels has gone down nearly 400 percent in the last four or five years,” LaSata said. “It’s become much more affordable, so I think it’s a potential threat to the large energy producers. Instead, I would hope they would look at it as an opportunity to encourage Michigan residents to expand the energy capacity of our state.”
The bill was introduced in June, which came as a result of a year and a half worth of work group meetings between the state Senate’s Energy and Technology Committee and 37 different interest groups in energy policy.
The reason the bill is in discussion is because the Clean Renewable and Efficient Energy Act, which former Gov. Jennifer Granholm signed in 2008, is set to expire in December 2015.
LaSata said the bill would have adverse effects on houses that use solar energy.
“Right now my family is able to use our solar system to power our farm,” LaSata said. “Senate Bill 438 states that we wouldn’t be allowed to use that energy, but sell it at a wholesale rate roughly 20 times less than the retail rate that we would be required to pay.”
Proos said LaSata’s concern is a legitimate one, as the former state representative’s rate of return would diminish under this bill.
With more than 1,850 residents using the net metering programs in the state, Proos said those residents would “very likely be grandfathered in” and not be forced to pay out at a new retail rate. Proos said they would need to amend the bill further on in the legislative process.
“I think that would improve the bill, but it would prevent other Michigan residents from becoming more energy dependent,” LaSata said. “The payback period for the solar equipment would more than double by going from 10 years to roughly 25 years.”
Updating energy policies
Proos said reliability, affordability and flexibility were the main factors that went into writing the bill.
During a committee hearing last week on SB 438, utility companies argued net metering provides a subsidy and allows customers to avoid covering the cost of the grid.
“This is an effort to make sure those who use solar power pay their fair share of reliability as the grid for their backup,” Proos said. “Those who have solar panels on their individual properties utilize the grid as a backup. They can unplug entirely from the grid, but I don’t know of anyone who has done that.”
Proos added: “It’s too important to the state that we update our energy policies to adjust for and prepare for the Obama administration’s huge policy changes at the state and federal level.”
LaSata said there is a misconception about solar power homeowners and their use of the grid.
While utility companies are alleging net metering users to be using the grid without paying for it, LaSata said the net metering system is reducing the use.
“When my solar system is producing its power, I don’t use the distribution system at all,” he said. “At night I do, but when my system is operating it produces about four to five times what my family can use. The excess power I generate I put on the grid, and that probably fuels other houses around me.”
If SB 438 is signed by the end of 2015, it is expected to expire in another five years.
Proos succeeded LaSata in the 79th House District in 2005, but LaSata says that has nothing to do with his stance on the bill.
“I love John Proos, I adore his family and I contribute to his campaign,” LaSata said. “It’s not personal. I just don’t like the bill.”
(Author’s Note: This article was originally published on Sept. 2, 2015)