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August 8, 2007
Paul Gipe

Solar Without Limits: Breaking Free from Net Metering


By Paul Gipe

August 8, 2007

For more than a decade, senior environmental leaders in North America have been waiting for Germany's renewable energy market to collapse, an expectation tinged with schadenfreude.


The following appeared as an op-ed in a recent issue of Photon International.


However, it's been one embarrassment after another for Americans. First it was wind, then biomass, and now solar PV. The German market continues to set records and dominate the world stage. Most embarrassing of all, the German market hasn't collapsed. And to the dismay of doomsayers in the "New World", Germany's ruling coalition recently reaffirmed their groundbreaking Renewable Energy Sources Act.

Worse yet, the idea is spreading. Now France, Spain, and more than a dozen other countries in the EU offer renewable tariffs. Italy, one of the first countries outside the US to embrace the quota model, nonetheless has switched horses in midstream and adopted a feed-in tariff for it's solar PV program to compete with its northern neighbors.

Some big EnNGOs in the US worry that feed laws may be catching on here, too. First it was tiny Prince Edward Island. Then Ontario, in the industrial heartland of Canada, introduced its Standard Offer Program. Could the idea leap the Detroit River and infect Michigan? If so, the NGOs fear that renewable tariffs will undercut their carefully crafted case that shoe horns ill-fitting renewables into the "electricity market".

European feed laws shatter this approach by decoupling the price paid for renewable energy from both the wholesale and retail prices of electricity. Feed laws essentially bypass all the ideological theory and the arcane mumbo-jumbo that goes for electricity policy here.

For nearly two decades North American renewables advocates have pushed net metering-the ability to run your kWh meter backwards.

Net metering served a useful purpose in the dark days of the Reagan-Bush-Clinton era. Net metering then was a call to arms for hobbyists and guerrilla solar activists out to prove a point-solar works, your meter will run backwards, and the lights will stay on.

But net metering was never intended to be a policy for the industrial development of renewable energy. It could not do that alone. Retail electricity prices in North America, especially in Canada, are abysmally--some would argue immorally--low.

Net metering was appealing because it rarely threatened entrenched electric utilities, and it gave politicians the perfect cover for appearing to take action on renewable energy, while doing nothing of substance.

There's typically a low limit on the amount of renewables that can be installed under net metering. Moreover, there's nearly always a limit on the size of any individual installation, often a paltry 10 kW. We certainly wouldn't want to rock the boat.

In the end, though, net metering won't get us where we want to go: massive amounts of renewables in the ground quickly. Net metering will never give us "plus energy" houses or "plus energy" buildings because we often literally have to give our surplus electricity to the utility company for free.

Europeans roll their eyes when North Americans speak of net metering. "Was ist das?" or "Qu'est-ce que c'est?" they can be heard saying. They don't bother with net metering. Europeans set a tariff for each technology, one sufficient to cover the cost of generation plus a reasonable profit. This ensures that they get the kind of renewables they want at the pace they want.

The time for half-measures, for timid responses like net metering, is past. The public, and now some progressive politicians as well, are demanding more aggressive policies. Some such as Michigan's Kathleen Law are suggesting a full-scale renewable energy sources act with solar PV tariffs on a par with those of Europe.

Al Gore, too, has joined the debate with his testimony on climate change. Before the US Congress, Gore called for a national law that permits homeowners and small businesses to sell their electricity to the grid "without any artificial caps". He went further and specified that renewable generators should be paid a fixed price determined by the cost of generation.

Gore's reference to "artificial caps" was targeted at the stranglehold net-metering programs place on the development of renewables. Gore gets it. It's time that others--both in and outside government-do as well.

For solar PV to make the substantial market inroads needed in the massive North American market, renewable energy advocates need to break free from the net-metering straightjacket. We need renewable tariffs here, too.


Paul Gipe is an American author, analyst, and advocate of renewable energy. His most recent book is Le Grand Livre de l'√Čolien (2007).


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