Alabama Public Services Commission ponders fees that would impact rooftop solar panels

On one side were utility representatives, saying they needed to be able to recover the costs of providing backup power to those who use alternate energy sources without charging other customers.

On the other were environmental groups who questioned whether the utility really needed to charge solar panels owners to tie into their grid to recover those costs, and whether it was meant to discourage rooftop installation.

“It’s really curtailing its use and it’s holding Alabama back as far as states all around us, and this technology taking off and creating the jobs that come along with it,” said Keith Johnston, the managing attorney for the Southern Environmental Law Center (SELC). 

Both made their cases in a two-hour hearing before the Alabama Public Service Commission on Thursday. GASP, a Birmingham nonprofit that advocates against air pollution and for renewable energy, brought the complaint against the fee in 2018; SELC represented the group at the hearing. 

Most of the hearing involved testimony from Natalie Dean, regulatory pricing manager for Alabama Power, and cross-examination from Kurt Ebersbach, an attorney with the SELC, over the fee. 

Alabama Power charges a $5 per kilowatt for rooftop solar panel owners to tie into their systems when they need backup power. The fee is not exclusive to solar power customers, but solar power users make up the vast majority of those assessed. Critics say the fee is meant to discourage rooftop solar panel installation.

The utility insists that it costs money to provide energy to solar power users. The fee, they argue, allows them to charge solar users those costs without spreading them to other Alabama Power customers. 

“I still have to stand ready to serve each individual customer’s needs 100 percent of the time whenever they need it,” Dean said during testimony. 

Dean also said the fee, which went into effect in 2013, was not developed in conjunction with forecasted development of solar power, but to allow the utility to recover costs when it may be overcast or if a panel breaks. 

“They have requested the company to provide a service to them, and there’s a cost to that service,” she said. 

But as Ebersbach noted, the cost appears to be small. Fewer than 200 people statewide — .02 % of the utility’s 1.2 million customers -- get charged. Ebersbach noted that the combined total capacity of those customers is about 650 kW, compared to a total utility capacity of 13,000 to 14,000 mW (or 13 to 14 million kW). 

Ebersbach at one point asked Dean if solar customers, who can generate their own electricity, can relieve the burden to the utility at peak usage times. Dean said the company factored that into their charge, but she acknowledged that it did allow the company to avoid the cost of providing energy to that customer. 

Ebersbach also cited studies, which Dean did not challenge, that suggested that solar customers on average cost less to the utility than non-solar customers. 

Dean insisted throughout her testimony that while the company avoided variable costs that might be associated with solar customers, the utility had to provide fixed service. 

“I cannot change my infrastructure to serve that customer,” she said. “I do not avoid the fixed cost to serve that customer.”

The commission also heard a statement from Karl Rabago, owner of Rabago Energy LLC, who called the charge “punitive, discriminatory, and unlawful” and said the fee was hurting the development of the solar industry in Alabama. 

More:Climate and change: How to decarbonize Alabama

“Solar naturally creates a tension with the traditional utility monopoly model,” he said. “Customer-installed solar cuts int the traditional utility profit-making model by reducing sales.” 

The hearing was overseen by John Garner, the chief administrative law judge for the PSC. Commission members listened to testimony but did not ask any questions during the hearing, and issued no ruling. Garner asked both sides to develop proposed orders by Dec. 20. 

Alabama Power has filed a petition to install about 400 mW of solar power in five counties in the state.

Thursday’s hearing drew a large crowd, most of whom were solar energy advocates. Early during Dean’s testimony, Garner said there would be no videoing of the proceedings. Police escorted two attendees — Laura Casey, a Democratic candidate for PSC President, and Kari Powell, a 2018 Democratic nominee for the PSC — who videoed or live-streamed the meeting. A third person was also asked to leave. 

Both Casey and Powell said in separate interviews after the meeting police briefly took their phones as a condition of returning. Both said they believed they had the right to record under the Open Meetings Act. 

Casey and Powell also said they considered solar power critical to the future. 

“Renewables will move us forward,” Casey said. “It’s better for our environment and our economy. It’s safe not to have a grid subject to attack. It’s just safer on every level. 

Powell said she was “an advocate for any kind of clean energy, including solar.”

“The planet is literally on fire right now,” she said. “I have children and I want to leave them a cleaner planet and a cleaner Alabama. I just care.”