Early Sunset on Missouri Solar Utility Rebate
The writing was on the wall; we knew it was coming. In Missouri, the $2 per watt rebate being paid by investor-owned utilities (IOUs) was scheduled to be reduced to $1.50 per watt starting in 2014. This reduction was designed to make the rebate last longer, since it represented as much as 2/3 of the cost of a commercial solar array. Proposition C, which was passed by 66% of Missouri voters back in 2008, required the IOUs to pay the rebate as long as the costs did not increase rates by more than 1%. Unfortunately the details of how to calculate that cost cap were not clearly spelled out, and the utilities and the state’s Public Service Commission have wrangled over exactly how to do that.
Kansas City Power & Light (KCP&L) filed a notice with the PSC in the summer of 2013 claiming that they’d hit their cap, based on the combined costs of rebates paid out and planned investments in wind farms later this decade. After reviewing their numbers, the PSC reached a settlement with the utility to clearly define funding available for rebates. Later in the year, after Ameren Missouri filed a similar notice, the PSC used the same methodology to calculate their cap, based on similar renewable energy projects planned for the future.
Solar installers could only guess how long the remaining funds would last. While industry insiders expected them to last through the end of 2013, Ameren filed a notice that their rebate fund had been conditionally exhausted based on the interconnection applications received as of December 16. This leaves many customers in a waiting queue, as applications are reviewed and either approved or rejected. There are other customers whose applications have been approved, but may not complete their project and thus forfeit their approved rebate. It leaves a lot of guessing on everyone’s part, and a corresponding anxiety.
The Missouri Solar Energy Industry Association (MOSEIA) has colloborated with the utilities to try and create an mutually-agreeable financial incentive to install solar. Distributed power generation like rooftop solar reduces the utility’s need to invest in new centralized power plants, and peak solar power production often coincides with peak summer demand. So, while solar continues to be a tiny fraction of the total mix, there are benefits for both the utilities and their solar power-producing customers. The utilities know their customers want solar, and they want to be able to facilitate that as long as it’s not a money-losing proposition for them.
In 2009, the Missouri Energy Efficiency Investment Act was created to create a cost-recovery mechanism for utilties to provide financial incentives for their customers to implement cost-effective energy efficiency measures, like more efficient lighting and appliances. This enabled utilities to include a small charge on everyone’s utility bill (with a few exceptions for large industrial users to opt out) that would pay for energy efficiency improvements. As a result, Ameren Missouri created their Act On Energy program to provide rebates for energy efficiency investments for both homes and businesses.
Once MOSEIA’s new board is elected at their annual conference in Kansas City early February, the organization’s leaders plan to work with utilities, regulators and Missouri legislators to create a similar funding mechanism for renewable energy. This would create a well-defined, sustainable program to continue making solar a more affordable investment for Missouri families and businesses.
For more information or to see how you can help, contact Heidi Schoen at HeidiSchoen@moseia.com and/or go to MOSEIA’s website (www.moseia.com) and click on “Connect with MOSEIA” in the bottom left corner of the page to get policy updates.
This was published in the Going Green section of the February 2014 issue of Spirit Seeker magazine.