New law may lower alternative energy costs

Alice Bean is looking forward to the day when the electric meter on her West Lawrence home runs both forward and backward.

Bean in November had photovoltaic solar panels installed on her home to convert the sun’s rays into solar energy. The result was that last month’s electric bill was just $26.

But Bean is confident it can be even less if Westar Energy begins paying her a fair price for the electricity that her solar system pumps back into the electric grid.

This week state legislators took the biggest step yet in making that happen. As part of the compromise to allow Sunflower Electric Power Corp. to build a new coal-fired power plant in Western Kansas, lawmakers approved new legislation that will allow Kansas residents to take advantage of “net metering.”

How it works

“This is definitely a step in the right direction to get people to embrace alternative energy not only on a large scale, but also on their own rooftops,” said Aron Cromwell, a Lawrence city commissioner who owns a business that designs and installs solar energy systems throughout the Midwest.

Here’s how the net metering system works: People who install solar systems, wind turbines or other alternative energy systems at their homes or businesses will be able to connect into their electric company’s power grid.

They’ll use their alternative energy system to power their own homes or businesses. But if the system produces more energy than is needed, the excess energy will be pumped back into the electric grid to be used by the electric company. The electric company then will provide a credit, or in some cases, a check to the consumer.

“Net metering basically lets you use the electric company as your own battery,” Cromwell said.

Kansas residents have been able to use a federal law to do a modified version of net metering. But under the federal law, electric companies are only required to credit consumers roughly the equivalent of the wholesale rate for excess electricity. Under the new state law, electric companies essentially will be paying retail rates for the excess electricity, Cromwell said. The retail rate could be three to four times higher than the wholesale rate, he said.

Installation costs

Now, the question becomes whether solar panels will start popping up around Lawrence.

Bean, a professor of physics and astronomy at Kansas University, said she thinks the new law can’t hurt.

“I don’t know what will happen, but I know not having it has caused a whole lot of people to not be interested in solar panels,” she said. “There is no financial incentive to do this unless you have net metering.”

Cromwell said a typical residential installation ranges from about $12,000 to $30,000, depending on how much of your electric needs you want to meet with solar panels.

Cromwell said most installations in Kansas are designed to provide only a portion of the electric needs of a home. But, he said, even those systems can benefit from net metering. When families are on vacation or away, their homes would still be producing electricity but using very little. During those times, the system would be pumping electricity into the grids.

Cromwell said some businesses may be able to benefit more. He said some businesses — like bars and restaurants, for example — may use the bulk of their electricity at night. If they placed solar panels on their roofs, they would be able to generate power during the day that they could use to offset their power usage at night.

“The interest from businesses has really been growing,” Cromwell said. “We’ve been in this for about a dozen years, and right now we have more large commercial proposals than we’ve ever had in the past.”

Bill less than ideal

Cromwell, who has some reservations about the coal plant, said he does wish the state would have gotten a stronger net metering law out of the Statehouse compromise. He said the net metering law is written in such a way that only investor-owned utilities will be obligated to participate in the program.

In this area, that means residents in Eudora and Baldwin would not be able to take advantage of net metering because those communities have city-owned utilities, Cromwell said.