PolitiFact Florida Shines A Light On Solar Energy Amendment 1

Oct 26, 2016

Several amendments to the state constitution will be on the ballot on election day, including one that would regulate solar energy. The wording of Amendment 1 has created some confusion, so WUSF's Steve Newborn shines a little light on that with PolitiFact Florida's Josh Gillin.

One of the more interesting things on the ballot - that not a lot of people are talking about because the presidential elections are sucking the oxygen out of the room is Amendment 1. It would regulate the rights of people using solar energy to sell excess power back into the electric grid.

Here's what former vice president Al Gore had to say about that earlier in October at Miami Dade College’s Kendall campus:

"The things they claim protect solar are protections you already have," Gore said on Oct. 11.  "But they are trying to fool you into amending your state Constitution in a way that gives them the authority to shut down net metering and do in Florida what they did in Nevada and just kill the solar industry."
 

Here's what PolitiFact Florida has to say:

Amendment 1, called "Rights of Electricity Consumers Regarding Solar Energy Choice," has drawn fire for crowding out a more grassroots solar power amendment that failed to make this year’s ballot because it didn’t garner enough signatures — in part because utility companies contributed millions to Amendment 1’s war chest.

The Florida Supreme Court determined the language of the amendment was not misleading and approved it 4-3.  It is widely considered a deliberate attempt by utilities to erect barriers to competition and prevent third-party leasing of solar. Utility companies have given most of the almost $22 million being poured into the amendment campaign. 

Florida is one of five states that do not allow a property owner to have a third-party installer put solar panels on their roof and sell the power back to them.

The amendment will leave that ban in place, but, if the ban on solar leasing and sales were removed, the language in the amendment could discourage third-party sales. It gives utility companies the right to impose new fees on all solar customers to compensate for the loss of revenue when solar customers don't buy their power, making solar sales and leasing less economical.

Net metering allows someone to sell excess solar-generated power to the utilities. Those people would also enjoy a lower bill because they draw less electricity from the traditional, power plant-supplied grid.

Utility companies nationwide have argued that this is unfair, because homes with solar panels are getting all the benefit of being connected to the grid without having to pay as much for the upkeep of generators and transmission lines as other customers. Traditional customers, they say, are subsidizing solar customers.

"The concern is that if you get all your power for free, you’re not paying your fair share," Stetson University law professor Lance Long said.

Solar promoters disagree with those claims. They argue that instead of costing non-solar customers more, solar energy brings more value to the electricity distribution system than it takes away. A Brookings Institution study in May looked at net metering in several states and concluded that when solar customers sell their power back to the electric utility through net metering, it actually helps non-solar customers in a few ways. The study said adding solar power reduces the need to build new power plants to meet peak demand, curtails costly grid maintenance, lowers reliance on oil and gas power generation, lowers utility rates, increases energy security and saves customers money.

Amendment 1 opponents therefore fear that utilities will lobby the state to allow a surcharge on solar customers or, as Gore said, change the policy for net metering. If Amendment 1 is approved, state officials could define what it means to "subsidize" solar power and lessen the economic benefits of third-party solar power for homes and businesses.

It’s a reasonable concern, since Florida utility providers have already grumbled about ending net metering. Florida Power & Light told the state Public Service Commission in June 2015 that it didn’t see the practice as sustainable, repeatedly referring to "subsidies required to support rooftop solar."

Ending net metering would strangle a vital revenue source for those third-party solar companies. Those businesses often install solar panels on houses for free or reduced cost, then make money by leasing the equipment and selling excess power to utilities. The chance to cripple competitors would give utilities a big incentive to kill net metering.

As Gore mentioned, that’s what happened in Nevada, which reduced net metering payments so much that major third-party companies left the state, dropping new panel installations by 92 percent in the first quarter of 2016.

Legal experts we contacted said that’s accurate; Florida’s Public Service Commission, which sets rates and handles utility regulations, would have to approve utilities’ requests. And since net metering is a part of state statute, the matter would likely end up before the state Supreme Court.  

That’s when Amendment 1 would really kick in: It would give utilities a much stronger argument that one way or another, solar customers should be paying a higher electric bill.

"It (the amendment) would create a constitutional right for utilities, and not just a regulation," Florida State University law professor Hannah Wiseman said. "It raises the stakes."

Our ruling

Amendment 1 doesn’t immediately give utilities authority to do anything, on its face. But it would potentially give them a constitutional argument to eventually charge solar customers more, or change net metering policies. There’s no certain proof that Florida regulators would approve either, but experts told us it’s a very reasonable suspicion. 

The amendment is widely considered to be deceptively worded and erects barriers to solar power that would favor traditional utilities. Gore is right to warn solar proponents it would work against their broader efforts.

Nonetheless, he went a bit too far to say the amendment would automatically grant utilities unchecked "authority" to kill net metering. We rate his statement Half True.