Vendors accuse WAPA of discouraging use of solar power in the V.I.
Published: September 14, 2013
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ST. THOMAS - The Senate Energy and Environment Committee opened up the floor to critics of WAPA's net-metering program on Friday.
Specifically, solar power vendors testified that WAPA selectively enforces Act 7075, the act establishing the program, adhering to some of the act's provisions when it is in their financial interest to do so and ignoring others for the same reason.
The end result, the critics charged, is that WAPA is extra-legally setting policy to discourage the use of solar power in the territory.
"There is a pattern of WAPA employees declining to adhere to provisions of Act 7075 and their promulgating regulations or practices pertaining to the administration of Act 7075 which are outside the scope of their authority under Act 7075 and have a chilling effect," said Edward McKenzie, part owner of Solar Systems VI. "That is as nice a way as I could put it."
McKenzie described three scenarios in which WAPA abused its authority under Act 7075: when it refuses to install two separate meters for photovoltaic systems on the same property even though the systems serve different account holders; when WAPA refuses to provide a single photovoltaic owner with more than one meter even though the owner might not exceed the acceptable limit of production for a single property; and when WAPA refuses to do satellite net-metering, which allows a net-metering customer to have solar power credit applied to another account in a separate location that does not have a photovoltaic system.
Act 7075 also mandates targets for reducing WAPA's reliance on fossil fuels to produce power, with stated goals of WAPA's overall energy produced through renewables accounting for between 20 and 30 percent between 2015 and 2025.
Co-founder of solar provider All Rounder Systems Steven Larchuk, exploded the conceptions about this timetable in his testimony, saying "there is no rational reason" why the territory should not already be at 50 percent renewable energy and moving toward 100 percent by 2025.
"We have near perfect wind and sun, and mainland investors are pounding at our doors to invest private money to develop what we need," he said. "All of the technology we require already exists and is rapidly becoming better and more economical."
WAPA Executive Director Hugo Hodge Jr. said he was constrained in his testimony from countering much of what solar vendors said with specifics because of a pending class action lawsuit filed last week.
The suit claims that WAPA's associated fees for the program are unjust; that WAPA discourages - through arbitrary and expensive equipment requirements and fees - the use of net-metering; and that, through faulty meters, WAPA fraudulently and knowingly double bills net-metering customers, charging them for the electricity they produce instead of crediting them.
Hodge's main and more general point about the program is that, though successful from the standpoint of its popularity - there are now 437 approved net-metering participants - it is not a boon to the overall customer base. Citing the territory's high level of poverty and the statistically lower incomes of Virgin Islanders compared with mainland residents, Hodge said other ratepayers subsidize the cost savings of net-metering customers and that, if revisions are to be enacted to the Act 7075 framework, they ought to address this economic inequity.
A net-metering customer can receive a 20-cent reduction in the average cost per kilowatt hour because WAPA credits them for the units of electricity they produce at the same retail rate that WAPA charges, according to Hodge.
This ratio, Hodge said, means that a net-metering customer contributes nothing toward the cost of distribution and administrative costs, such as billing. Because many of WAPA's customers cannot afford the up-front investment of installing a solar system, or are not property owners with the license to do so, "the little man does end up paying for the net-metering program," Hodge said.
Sen. Craig Barshinger, the chairman of the Energy Committee, questioned the assumption that net-metering does not benefit ratepayers overall, as it means injecting more solar energy into the grid, and as solar-produced electricity is more cost-effective than that produced by non-renewables.
Barshinger also countered the idea that net-metering customers have achieved an unfair advantage, calling them "early adopters" and citing the risk of investment they took upon entering the program.
Larchuk raised the point that non-participants experience indirect economic benefits when businesses are able to significantly reduce their energy bills.
"If a grocery store has to pay more for its electricity, then that cost gets factored into a gallon of milk," Larchuk said.
During a question-and-answer session, Hodge also defended the gradual timetable of Act 7075's scaling up of renewable fuel sources, saying that the intermittent nature of wind and solar power have to be balanced with "dispatchable" forms of energy. An integrated mix of fuel sources will need to be maintained to provide electricity when the sun is not shining or the wind is not blowing, and the timetable allows WAPA to make planned adjustments to its grid to handle the burden of continuous service, according to Hodge.
Legislators on the committee said they would take all of the testimony into account when writing revisions to the net-metering act in the coming months.
"It is obvious that all of us are going to have to sit down together and come up with a way that the net-metering program can benefit all of the people of the Virgin Islands," Sen. Diane Capehart said.
- Contact Amanda Norris at 714-9104 or email firstname.lastname@example.org.