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Kentuckians Debate How Net Metering Impacts Low-Income Families

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Kentucky utility regulators held their first public meeting over the future of solar power in the state on Tuesday.

Thanks to a new state law, the Kentucky Public Service Commission is reviewing the state's net-metering rules, which set the value rooftop solar customers receive from utilities for the excess power they put back on the energy grid.

Right now, if you have solar panels on your home you receive a credit for the retail value of the power you put back on the grid.

Utilities would like to pay less for that solar power and advocates would like the rules to stay as they are now. Both sides say they’re fighting to protect low-income communities.

State regulators heard from utilities and more than 40 solar advocates who came to Frankfort to provide testimony as part of the review on Tuesday.

Utilities said that the more people who put solar panels on their homes, fewer are left to pay for utility investments. They said those costs are insignificant now, but will add up as more people buy their own solar panels.

And because low-income families are less likely to be able to afford solar panels, they end up taking on more of the cost burden from utilities. Louisville Gas and Electric Spokeswoman Chris Whelan said it’s always been about treating customers fairly.

“It could actually impact our low-income customers because they are paying or subsidizing for the folks who can afford, or who want solar,” she said.

Kentucky's smaller electric cooperatives also say the reforms are necessary.

"Let's define what the costs are from the very beginning and not say 'let's wait and kick the can down the road until it's a problem,'" said Kentucky Electric Cooperatives Spokesman Joe Arnold, who represents co-ops in nearly every county.

But several of the solar advocates who turned out at the public meeting say solar panels are actually helping them lower costs for low-income customers.

Carrie Ray with the Mountain Association for Community Economic Development said that with the right programs in place, solar panels are a solution to offset soaring electricity costs for low-income families.

Ray said MACED has helped facilitate 10 solar installations for low-income customers over the last two years, and the organization has already planned 17 more projects.

“The chamber and the utilities have provided no evidence that net-metering has made any impact on rates, but Kentucky Power small commercial customers have faced a 214 percent increase in their demand charge in the past two years,” she said.

Representatives from Appalshop, a renowned arts nonprofit in Letcher County, said installing solar has meant the organization has seen a 70 to 90 percent reduction in its electric bills and they hope to get a return on their investment in the next 12 to 14 years. Community Development Worker Marley Green said he wants others to have the same opportunities Appalshop has had.

"We and our partners went with solar because we wanted to support a new and growing regional economy, we wanted to decrease our environmental impact, but by far the biggest reasons was the growing cost of our electricity bills," Green said.

Dr. Edwards Roberts is a physician in Mount Sterling, Kentucky, who runs a nonprofit clinic that cares for uninsured and under-insured residents. He said current net-metering laws helped the clinic save $1,300 on electricity bills over the last year.

“This money was used to purchase medical and dental supplies. We have a very limited budget. The physicians who work on the clinic are all volunteers,” Roberts said.

The Kentucky Public Service Commission will ultimately decide rates that reflect the "costs necessary to serve” net-metering customers. This will likely include the costs of transmitting and distributing electricity, a cost not reflected in the current rate.

Disclosure: Louisville Public Media partners with WMMT, the community radio station run by Appalshop, for initiatives including the Ohio Valley ReSource.

Ryan Van Velzer is WFPL's Energy and Environment Reporter. Email Ryan at rvanvelzer@lpm.org.