Nova Scotia Power has announced a one-year delay for a controversial proposal to charge fees to customers who sell renewable power back to the grid, after a wave of industry and community concern that the plan could wipe out the province’s emerging solar industry.
In a release, Nova Scotia Power (NSPC) President and CEO Peter Gregg said the proposed net metering charge filed last week with the Nova Scotia Utility and Review Board would now take effect February 1, 2023 if it is approved, The Canadian Press reported yesterday.
Gregg said the utility “regrets” that there wasn’t more advance consultation with the province’s solar industry, which was caught off guard by the proposed changes.
He said NSPC hopes the delay will provide enough time to create solutions that support the continued growth of the solar sector.
The utility’s proposal would charge solar customers a monthly fee of about $8 per kilowatt of electricity, adding up to about C$960 a year for a typical 10-kilowatt photovoltaic solar installation, which generates about $1,800 in annual revenue.
Previously, Gregg said that without the fee, homeowners who generate their own electricity from solar panels were subsidized by other customers, so charging them for selling excess power back to the grid would ensure fairness for all customers.
“These are customers who generate their own electricity at their home or business and use (Nova Scotia Power’s) power lines and infrastructure to put their excess energy on the grid or use power from the grid when they don’t produce enough,” he said in a statement Saturday.
But “a broad coalition of stakeholders aren’t convinced of the extra per-kilowatt monthly price tag, claiming it’s far above a reasonable rate,” PVBuzz Media reports. Solar Nova Scotia (SNS) warned that a charge of $8 per kilowatt would double the payback period for home solar, making the technology “not feasible for just about everybody,” said SNS Chair David Brushett. “Even if the regulator ultimately rejects it, there’s going to be uncertainty over the next months and nobody will install solar.”
“This is a death knell,” agreed SNS Treasurer Don Rosco.
“Imagine you’re a homeowner who wants to do your part to help the environment and your community by setting up solar energy on your home. Then, on top of paying for installation, to connect to the grid, and for a net meter, you now have to pay an additional monthly system access charge,” agreed Gurprasad Gurumurthy, energy coordinator for renewables and electricity at Halifax’s Ecology Action Centre.
“We’re in a climate emergency, and this fee will disincentivize residents who want to set up solar energy at a time when we need to be transitioning to renewables as fast as we can.”
In a release Friday, the Canadian Renewable Energy Association urged the provincial government to “restore consumer confidence” in the industry by challenging the NSPC proposal. “This proposed charge would have a direct impact on small businesses and homeowners seeking to contribute to Nova Scotia’s target of reducing greenhouse emissions and achieving 80% renewable electricity by 2030,” warned Nicholas Gall, CanREA’s director of distributed energy resources.
“We are calling on the Government of Nova Scotia to intervene to ensure that Nova Scotians can continue to pursue rooftop solar installations and make significant climate-friendly investments in the province,” added Brandy Giannetta, the association’s vice-president of policy, regulatory and government affairs.
The Progressive Conservative government’s minister of natural resources and renewables, Tory Rushton, seemed inclined to do exactly that, PVBuzz writes. “Nova Scotia has set one of the most ambitious targets for reducing greenhouse gas emissions, and to get there we will need a range of solutions to expand access to renewable energy, including solar,” he said in a statement. “We’re frustrated that N.S. Power has made a proposal that can hinder the progress we’ve been making to advance our climate change goals.”
Rushton vowed the province would show up as “active intervenors in this process”, and was “exploring all of [their] options to respond to this move and to protect ratepayers.”
The NSPC proposal renewed enduring concerns about the 30-year-old privatization of the utility and its allowed return on equity of about 9%, a situation that appeared to be contributing to some of the rancour surrounding the proposed fee, CP wrote. Opponents have accused NSPC, a subsidiary of multinational holding company Emera Inc., of using its monopoly on electricity distribution to prevent competition from small-scale renewable systems.
Gregg maintained the proposed new system access charge would contribute to a strong and fair net metering program, and was a critical part of getting Nova Scotia off coal by 2030.
One longtime observer of provincial energy policy, Brendan Haley, said the top-line debate over the system access charge missed some important context.
“To figure that out you need to count both costs and benefits to everyone on the grid,” Haley tweeted. Yet NSPC’s last long-term modelling under its Integrated Resource Plan (IRP) failed to factor in a C$170-per-tonne carbon price by 2030, the province’s 80% renewable energy target, Canada’s 2030 coal phaseout deadline, and a zero-emission vehicle mandate—and attached a zero dollar value to any carbon reductions that exceeded its previous, now very low target.
“That’s a big oversight!” Haley wrote. “Given that solar is still small and there is value in creating local industry capacity to capture local benefits, it makes sense to hold off on a solar charge.”
Major segments of this report were drawn from dispatches from The Canadian Press published January 30 and February 1, 2022.