Arizona Becomes Latest Battleground in Big Utilities War on Rooftop Solar

By 2020, utility company customers were paying an average of over $0.10 per kWh of power.

Whereas the average cost of electricity produced by a rooftop solar system had dropped to only $0.06 to $0.08.

You don't need a Ph.D. in economics to predict what happened next: The solar industry experienced an unprecedented boom as more and more Americans discovered how much money they could save by investing in a simple rooftop system.

Unfortunately, nor do you have to be an economist to predict that the big utility companies would take drastic action to avoid losing even more customers.

Thus far, their main tactic has been lobbying state governments to lower the compensation solar-equipped homes and businesses get for the surplus energy they send back into the grid.

A systematic assault

In some states like Pennsylvania, utilities are required to pay the same rate that they charge.

These "Net Metering" laws allow consumers to effectively “bank” the excess solar energy their systems produce during peak hours for use at other times.

So, in order to kill the financial viability of rooftop solar, the big utility companies have been pushing states with consumer-friendly Net Metering policies to drastically cut compensation.

Just last year, the big power companies successfully lobbied state legislatures in California, Florida, Indiana, Idaho, Michigan, and North Carolina to pass laws that slash net metering compensation.

Arizona latest battleground

The latest battleground state is Arizona, where the state's public utilities commission is set to vote on an amendment that would reduce net metering compensation by a jaw-dropping 37%.

Should it pass, the amendment will essentially let Arizona power companies buy surplus power from solar-equipped homes at a rate of $0.053 per kWh, and then sell it to their neighbors for nearly triple that price.

Some good news

The good news is that if you’ve already transitioned to clean and renewable solar energy, you probably don't have to worry about this burgeoning war.

State governments are disinclined to pull the rug out from under people who’ve already invested in solar. As a result, consumers are pretty much always grandfathered under whatever compensation scheme was in effect when their system was installed.

The big utility companies seem to be starting their attacks on net metering in sunny states like California, Florida, and Arizona. That's understandable since those are the places where rooftop solar poses the biggest immediate threat to utility company dominance.

But it’s only a matter of time before they start turning their attention to states like Pennslyvania that have adopted very consumer-friendly net metering policies.

Between that and the all-but-certain prospect of rising interest rates,  the best time to reap the benefits of going solar may be now.

Share this post


US to Impose Tariffs on Five Major Solar Panel Manufacturers
Solar panel importers BYD, Longi Green Energy, Canadian Solar, Trina Solar, and New East Solar will all face tarrifs next year as a result of the Department of Commerce finding tthat all five firms violated US anti-dumping laws