This is Part Three of a series on attacks on net metering in 2014 from the Energy & Policy Institute. Read Part One: North Carolina's Duke Energy Plans Attack on Solar and Part Two: Utility Interests Push for Protectionism in the State of Washington.
Last week, the Kansas House Energy Committee again considered taking up an anti-solar net metering bill (HB 2458) pushed by two major utilities Westar Energy and Kansas City Power & Light. The House committee passed an amended HB2458 that would make substantive, negative changes to solar net metering if passed through the state legislature. As amended, HB 2458 would allow utilities to pay solar customers generating excess electricity less than the retail rate of electricity. Instead, excess credits for electricity generation would be calculated at the end of each month’s billing cycle, and the utilities would pay less for customer-generated electricity. Utilities would then turn around and sell the electricity to customer-generators neighbors at the retail rate - generating revenue for the utility from the customer’s solar investment.
Anti-Solar Bill Passes ALEC-Chaired Committee
The bill was tabled the week before last in what Chairman Dennis Hedke called a “surprise vote” of 9-7. Hedke, a member of the American Legislative Exchange Council (ALEC), said the bill would “come come off the table” at some point - and yesterday it did. ALEC’s utility members and the utility trade association, Edison Electric Institute (EEI), have been pushing to gut net metering policies through a new model resolution passed during their December meeting in Washington, D.C. At least five additional members of the Kansas House Energy Committee are known ALEC legislative members: Representatives Steve Alford, Randy Garber, Charles Macheers, Scott Schwab, and Joe Siewert.
As it was introduced, HB 2458 would have ended net metering, and the amended bill would also gut the program in favor of a pro-utility industry policy. Testifying before the committee, the utility industry said that a lower level of compensation would be fair, according to Andy Marso at the Topeka Capital-Journal. The utility’s aim is to credit customers generating excess solar electricity at a rate of 150% of each utility’s avoided cost, which would very likely be far less than the retail rate of electricity. The utility would then be able to sell the excess solar electricity to the customer-generator’s neighbor for a much higher retail rate, benefiting the utility’s balance sheet with bonus revenue.
Dorothy Barnett, the Executive Director of the Climate and Energy Project, said the amended bill would make changes so that, “At end of month, excess credits would have no value. Solar power generators would have no “rollover” credits from one month to the next or get paid for excess power generated.”
"Mark Schreiber, Westar’s executive director of government affairs, told legislators that under current law his company 'is paying net-metered customers a retail price for a wholesale commodity' and that the 1-to-1 kilowatt credit doesn’t account for infrastructure costs like power plants and power lines.” Marso goes on to report that pro-solar advocates at the Vote Solar Initiative say that “customers who produce their own electricity save everyone money by lessening the amount of infrastructure needed within the grid, reducing the amount of electricity lost as it is transmitted over power lines, and preventing pollution.”
The amended version of HB 2458 is still an effort by utility interests and their allies in the legislature (many of whom are ALEC members) to eliminate the threat distributed solar energy poses to the utilities’ profits.
Front Groups Attack Clean Energy in Kansas
Third party groups are also getting in on the fight. Americans for Prosperity Kansas (the astroturf group founded and funded by the Koch Brothers) is pushing to repeal the state’s renewable portfolio standard (RPS) and hosted the Emerging Energy Issues Forum in partnership with the Heartland Institute (another fossil fuel-funded front group) and the Kansas Chamber of Commerce on February 13.
During the event, operatives representing Heartland Institute and others went after both the RPS law in Kansas and net metering. Representatives on the panel at the event also cited the debunked “Spain green jobs study” to claim that clean energy jobs result in other job losses. Americans for Prosperity has also launched a television ad, echoing disinformation that the RPS is causing electricity rate hikes.
James Taylor from the Heartland Institute claimed that the cost of electricity prices are rising much faster in states with RPS policies, asserting that Kansas’ RPS law was causing electricity prices to skyrocket by 19.4% since 2009. However, the Kansas Corporation Commission, which regulates utilities in the state, reported that the RPS has affected electricity rates by less than 2%.
The American Wind Energy Association explained why utilities are raising rates in a recent blog post debunking Heartland Institute’s flawed analysis: “The cost of providing other forms of electricity to consumers has been increasing, and in Kansas, upgrades to aging plants have prompted Kansas City Power & Light to request rate increases. Westar Energy also sought rate increases for its customers to help finance its share of necessary upgrades to outdated facilities.”
The utility interests and front groups attacking clean energy are using disinformation to inflate the costs of clean energy, and protect the fossil fuel status quo from competition. Kansas is just the latest example of how these corporations and their allies operate.
Chairman of Committee Tied to Fossil Fuel, Utility Industry
Chairman Dennis Hedke has substantial ties to fossil fuel and utility interests pushing anti-clean energy legislation through the Kansas House Energy Committee.
In 2012, Hedke received approximately 20% of his campaign contributions from fossil fuel and utility entities. Hedke received contributions from:
- Koch Industries, a major fossil fuel conglomerate with interests in coal, gas and other fossil fuels
- Sunflower Electric Power Corp., which generates 76% of its electricity from big fossil fuel power plants
- National Cooperative Refinery Association
- Kansas Committee for Rural Electrification, which is funded by electric utility cooperatives
- ONEOK, Inc., one of the largest natural gas distributors in United States
- ANR pipeline, a company in the natural gas pipeline business
- Kansas Chamber of Commerce, whose membership includes ONEOK, Koch Industries, Kansas City Power & Light, Westar Energy, Sunflower Electric Cooperative
Finally, Hedke has personal ties to the fossil fuel industry. When he’s not pushing pro-industry legislation, he’s a “contract geophysicist whose client list includes 30 regional oil and gas companies,” according to a report from the Topeka Capital-Journal.
Zack Pistora, a spokesman for the Kansas Sierra Club put it nicely: "It is clear that Hedke has been influenced heavily by the money involved from his contract work with the oil and gas industry. As a state representative, he needs to put his own financial interests aside and focus instead on doing what's right for Kansans, our environment, and our future generations.”
Unfortunately, the most recent bill out of Hedke’s committee does the opposite: it protects the fossil fuel and utility industry and hurts the prospects for solar in Kansas.