By JAN LARSON McLAUGHLIN
BG Independent News
As the stalemate between the city of Bowling Green and residents with rooftop solar festers, a possible compromise was proposed last week.
But the question remains – is the rate charged to rooftop solar users a reasonable “fee” or an unfair “fine.”
During last week’s council meeting, City Council member Bill Herald asked Municipal Administrator Lori Tretter to look into a possible income tax credit for those city residents with renewable energy at their homes.
That step could incentivize the use of renewable energy and take care of the Board of Public Utilities concerns about fair electric costs for all customers.
“I’m just asking as a member of council,” Herald said to Tretter.
The fee charged to homes with rooftop solar systems has been criticized by homeowners who refer to the fee as a penalty that will discourage residents from installing rooftop solar panels.
They say that the “green” image of Bowling Green is being tarnished by the rooftop solar policy.
One family – Leatra Harper and Steven Jansto – is so outraged about the fees that they have decided to sell their home and move to another community.
They moved to Bowling Green three years ago, relying on the city’s reputation as a clean energy champion. But after installing their rooftop solar system, they received a letter stating that they would be charged a fee because of “unavoidable grid costs.”
“We were especially shocked that the utility department would accuse rooftop solar owners of not paying their fair share of unavoidable grid costs, which cannot be substantiated,” Harper said.
“The new policy to charge extra for rooftop solar will slow if not stop individual investments in solar in the city,” Harper said.
Harper believes the solar fee is a direct result of the city’s contract with the Prairie State coal-fired power plant, that was entered into with other municipalities that are part of American Municipal Power (AMP).
“We cannot live in a city that would squash investments in solar with a policy that will cause any payback period to extend well beyond the life of the solar system,” Harper said.
Another rooftop solar user, Joe DeMare, has been a regular attendee at Board of Public Utility meetings this year. He has been very vocal about the solar fee.
“The city is taking the value of the rooftop system away from me,” DeMare said at a meeting earlier this month. He presented the board with a petition with 400 signatures, asking the city to reverse its rooftop solar policy.
DeMare has encouraged the utilities board to look at rooftop solar as part of the solution. “It could literally help save the planet.”
“You’ve chosen coal over the sun,” DeMare said to the utilities board earlier this month.
After years of planning, DeMare had rooftop solar panels installed on his home last July. A big believer in green energy, DeMare wasn’t banking on the solar power being a big money-maker – but he also hadn’t figured on it costing him money beyond the installation.
Shortly after installing the panels, he got a letter from the utilities department explaining that the city had instituted a new fee for rooftop solar energy.
That fee increases with each kilowatt produced.
“This really discourages anyone from putting solar panels on their homes in Bowling Green,” he said. “This is not what a progressive community does.”
DeMare said the letter from the utilities department attributed the fee to “unavoidable expenses” incurred when rooftop solar systems transfer the extra power onto the grid to be used by other electric customers.
“There’s no justification for these increasing penalties,” he said.
But Brian O’Connell, director of the city’s public utilities, said the fee is necessary to make sure other electric customers in the city aren’t paying for those who choose to install rooftop solar panels.
The electric rates in the city are based on customers buying their energy from the city. A smaller portion of the rates is based on fixed electric system costs for such items as meters, poles, wire, transformers, switches and linemen – items needed for all homes including those with rooftop solar, O’Connell said.
“Those fixed costs don’t change just because someone decides to put rooftop solar on their home,” he said.
The city reimburses rooftop solar systems for the extra energy they produce and send to the city’s grid to be shared with other users.
Without that fee being charged to homes with their own solar power, “the other customers are subsidizing their energy sales,” O’Connell said.
“Our goal was to set up a policy that is fair for customers who want to use it, but won’t penalize other customers,” he said.
But DeMare questioned that rationale.
“That’s misleading. It doesn’t cause any more wear and tear” to the city’s system to send extra power onto the grid, DeMare said.
The new fees went into effect in July, and start out charging $1 a month per kilowatt capacity. That will be $6 per month for a system like DeMare’s which produces six kilowatts.
The fee will increase $1 annually, until it reaches the ceiling of $4 per kilowatt capacity – or $24 a month for DeMare.
O’Connell stressed that Bowling Green is committed to solar energy – evidenced by the largest municipal-owned solar field in the state, located east of the city.
“We are not against renewable energy,” he said. “But there’s also a financial obligation to make sure the system is kept whole.”
The city is pleased to credit rooftop solar homeowners for the extra energy they produce during peak times, he said. “We realize there’s a value for that.”
There are currently 10 home rooftop solar systems in Bowling Green, with three or four installed under the new policy, O’Connell said.
The fee was set by a cost of service analysis.
But Harper questioned the objectivity of the analysis.
“Similar policies have been enacted by other municipalities that signed the financially disastrous AMP contract with Prairie State, obligating ratepayers to not only pay capital costs, but the huge amount of debt servicing required by the coal-fired power plant, a major emitter of harmful pollutants,” Harper stated.
City officials agree that in hindsight, the Prairie State contract was an unfortunate decision. But Bowling Green and other cities in the contract made a commitment to pay off the bonds for the project.
“Those costs don’t change whether a customer buys anything from us or not,” O’Connell said. “The utilities’ job is to look out for the rates of all customers.”
If residents with rooftop solar don’t pay the fee, “the other customers have to make up the difference,” O’Connell said. “Our job is to determine what is fair to charge across all customer classes.”
“Our job isn’t to incentivize,” he said. “Our job is to make sure every customer is treated fairly.”
But Harper sees the fee as a penalty against rooftop solar users to help make up for Bowling Green’s poor decision to enter a contract with the Prairie State coal-fired power project.
The city is stuck with its Prairie State agreement until 2047.
“We’re involved as long as there is debt to be paid off,” O’Connell said. “You can’t get out of that.”
Mayor Mike Aspacher and O’Connell explained the city’s decision to enter the agreement with the coal-fired power plant in 2007.
“At that time, Prairie State looked like a very good, viable resource for the city,” said O’Connell, who was not utilities director at the time. “They made the best decision they could at that time.”
Wholesale power markets change overtime, Aspacher said.
“That appeared to be the most sound, cost-effective option,” the mayor said of Prairie State. “If we were looking at that in today’s world, it’s very likely a different decision would be made.”
The city of Bowling Green boasts the second highest use of green energy of any municipality in Ohio. Of the 40% renewable energy used to power the city, 34% is from hydro, 5% from solar, and 1% from wind. The most expensive power purchased by the city is hydro.
“I’m proud of the city’s demonstrated commitment to renewable energy,” Aspacher said. “We continue to look at opportunities to invest in renewable energy.”
“We certainly aren’t trying to create a disincentive,” the mayor said. “We respect these homeowners. But his job is to oversee a municipal electric system that provides reliable, safe, electric for all of our customers,” he said of O’Connell.
“Our job is to recover the costs,” O’Connell said. To do otherwise would be a subsidy for rooftop solar residents.
O’Connell feels the city already made a compromise on the matter in 2020, when the decision was made to delay the implementation of the fees and to make $1 incremental changes each year till it reaches the $4 per kilowatt capacity monthly cap.
He defended the fee.
If rooftop solar homeowners want to sell their excess power to the city, that power will use the city’s grid and distribution system.
“There is a cost for them to put energy back in the system,” O’Connell said.
He compared the rooftop solar fee to the hybrid and electric vehicle registration fee put in place for electric vehicles that avoid the state’s gas tax, but still put wear and tear on roadways.
“It’s an issue of fairness,” O’Connell said.
