As changes in how we produce and consumer energy evolve, state utility commissions are revising how solar customers will benefit from surplus energy their panels produce. This article explains the pros and cons in plain language. Looking to go solar? Now is a great time to get grandfathered in for the highest energy credits. Talk with a Panasonic installer today and get all your questions answered.
Florida businesses and homeowners will have until December 2028 to install rooftop solar and receive any financial credit for selling excess energy back to their electric utilities if Gov. Ron DeSantis signs legislation approved by the Florida House and Senate.
But the longer customers wait, the lower the financial benefit.
Starting in 2024, the financial credits some rooftop solar homeowners see on their bills will gradually decrease until they are reduced to a level state regulators determines is no longer considered a subsidy. The legislation requires that solar customers pay all fixed costs of having access to transmission lines and back-up energy generation as determined by the Public Service Commission.
There are still many unknowns. Starting in 2029, the PSC will impose new rules for how much solar users will be paid when they sell excess energy back to the grid, and how many fees they are charged to stay connected to the grid. But legislators did not impose any guidelines.
Here is what the legislation does require if the bill becomes law:
1) A phased reduction in credits
Over time, rooftop solar owners will be paid less for the energy they sell back to their utility system.
2) A 20-year grandfather clause
It grandfathers in any homeowner or business who owns or leases a rooftop solar system. Anyone who has a system before Jan. 1, 2029, will be allowed to keep for 20 years the level of credits they received at the time they installed their solar system.
3) PSC may add new charges for solar customers
After Jan. 1, 2024, utilities may petition the Public Service Commission for approval to impose new charges "including base facilities charges, electric grid access fees, or monthly minimum bills to ensure that the IOU [investor-owned utility] recovers the fixed costs of serving [solar] customers."
4) Market penetration could trigger a new rule
If the PSC finds that the market penetration rate of customer-owned or leased solar across all investor-owned utilities in the state exceeds 6.5%, the PSC must adopt a new rule. The bill does not define what that rule would look like or what impact it would have on rooftop solar owners.
5) The schedule for reduction of credits
Customers receive a credit on their monthly bill equal to the value of the excess energy per kilowatt hour based on the following schedule: (Retail rates for the utilities range from about $0.12 to $0.15 per kilowatt hour.)
- Between Jan. 1, 2024, and Dec. 31, 2025, energy credits produced from rooftop solar generation will be reduced to 75% of the current value.
- Between Jan. 1, 2026, and Dec. 31, 2026, the credit will be reduced to 60% of the current value.
- Between Jan. 1, 2027, and Dec. 31, 2028, the credit will be reduced by 50% of the current value.
- Beginning Jan. 1, 2029, the PSC must adopt new rules that ensure that rooftop solar customers "pay their full cost of electric service and are not cross-subsidized by the general body of ratepayers," which would eliminate the billing credit.
This article is written by Mary Ellen Klas from Miami Herald and was legally licensed via the Tribune Content Agency through the Industry Dive Content Marketplace. Please direct all licensing questions to legal@industrydive.com.
