Appalachian Power’s(APCo) proposal to revise its net metering program has received pushback from solar developers and clean energy stakeholders that say the changes would harm the industry by reducing rates.

In PUR-2024-00161, first submitted by APCo to the Virginia State Corporation Commission (SCC) in 2024, the utility proposes to close its current Rider Net Metering Service (Rider NMS) to all new customer-generators and introduce a new net metering credit compensation structure designated Rider NMS II.

Rider NMS II would charge customer-generators for all metered energy APCo provides during each monthly billing period at standard tariff rates and credit the customer-generators for all the metered energy APCo receives at an avoided cost approved by the SCC. The net metering rates, which impact C&I and residential solar customers, would be trimmed across the board.

For secondary voltage level C&I projects, the total energy credit in the proposal is USD 0.0462 per kWh. For primary voltage C&I projects, the credit is USD 0.0443. For sub-transmission level C&I projects, the credit is USD 0.0438. Transmission level C&I projects earn a 0.0432 total energy credit. The residential net metering rate change from USD 0.16/kWh to USD 0.049/kWh has been heavily discussed on news reports since its proposal last year.

“The proposed Rider NMS II will ensure appropriate crediting to customer-generators for the energy delivered to the grid while minimizing cost-shifting to non-participating electric utility customers,” APCo said in its initial petition. “Under the proposed Rider NMS Il, the company proposes to bill customer generators for the costs associated with distribution, transmission, and capacity facilities and other services that they rely on when they are not self-generating. Monthly charges will be calculated using an identical rate structure to the structure that would apply if the customer were not a customer-generator.”

Only electric generating facilities that receive a Certificate of Completion after Rider NMS II becomes effective will be subject to this proposed rate structure, while existing Rider NMS generators and those who submit applications and receive a Certificate of Completion before Rider NMS II takes effect will be grandfathered under the current system for up to 25 years.

A public hearing has been scheduled for the proposal on May 20, and solar developers and other stakeholders have already voiced opposition to APCo’s plan ahead of the May 13 written comment deadline.

Kevin M. Lucas, on behalf of the Clean Energy Solutions Coalition made up of Advanced Energy United, the Solar Energy Industries Association(SEIA), and Chesapeake Solar and Storage Association (CHESSA), said APCo’s methodology in changing net metering is flawed.

“APCo’s proposal to substantially modify its NEM structure should be rejected by the Commission. The burden of proof to shift away from the current status quo NEM structure rests on APCo, and it has failed to sufficiently support its proposal,” Lucas said in written testimony. “Its main policy argument against the current NEM structure, based on an IMPLAN economic analysis, is flawed and does not properly represent the operations of a regulated utility. In addition, its calculation of the avoided cost of exported NEM energy should be disregarded as it contains multiple methodological errors and questionable assumptions.”

Virginia-based residential and C&I developer Baseline Solar has put out a call to action on its website emphasizing that the plan would heavily impact companies and solar owners.

“Appalachian Power is fighting hard to dismantle the longstanding and fair net metering policy in the state of Virginia. If the Virginia State Corporation Commission rules in Appalachian Power’s favor and net metering gets slashed by 70%, payback times for going solar with increase by an estimated 15-25 years, which will eliminate solar as a viable choice for the vast majority of Virginians.”