Keep the Net Metering Program Running

— Josie Oliva

Net metering is under fire in the Homer Electric Association (HEA) boardroom. The HEA Net Metering Program is open to all retail members. It provides an opportunity for members to install and use certain types of renewable generation, like home solar, to offset monthly electric usage and sell excess power, if any, to HEA. In 2010, HEA was the first utility in Alaska to adopt net metering standards designed to encourage the development of member-owned renewable energy systems.

At the HEA board’s last meeting, Robert Wall called for a resolution to close the door on the Net Metering program, which credits HEA members who’ve invested in home solar in their bills for the energy they save and the excess energy they contribute. If director Robert Wall has his way, denial of all new net metering connections will be on the table at HEA’s July 9th meeting. 

Wall, who denies human-caused climate change and has said at previous HEA meetings that “CO2 is the gas of life, we don’t need to worry about it,” was just re-elected in May to represent the Soldotna/Sterling area on the 9-member HEA board. He’s an oil and gas drill supervisor for Top Performance Drilling, a company he owns – though he neglected to mention this in his HEA candidate packet this year. 

“I would like to build a net metering contract suspension resolution to be presented and…voted on in July, with our attorney’s advice on the proper verbiage,” Wall said at the June HEA board meeting. “And the reason I want to do that is because I still see a problem with the net metering acting as a subsidy. We’re not protecting a lot of our ratepayers, and I want to make sure that we are clear on what it does. And if we have the power to suspend any further contracting, I believe it would be in the best interest of our co-op members that we do that and I would like to have a resolution constructed and ready to be voted on in July.” Wall said.

Net metering is an option for utility members to produce their own energy, most commonly from solar panels, while remaining connected to the grid. If a member produces more energy than they need for their monthly use, that energy goes to the grid as power for other members, and this energy is purchased from the utility at a low rate in the form of a credit to their account. 

What Wall refers to as a “subsidy” is the hypothetical cost to HEA of dealing with the variability of solar power – the fact that output from panels swings quickly and unpredictably with the amount of sunlight. In areas with very high levels of solar energy, such as California or Hawaii, utilities solve this issue by using battery systems. That cost would need to be fairly distributed among members – if it was something HEA actually had to deal with. HEA’s engineering staff has told the board, most recently during a presentation at the May meeting, that we have nowhere near the amount of net metering that would put additional costs on the co-op. Wall is eager to impose a severe limitation on HEA members – taking away the choice of participating in the Net Metering program – in response to what is currently an imaginary problem. 

HEA net metering members pay both a $20 member charge, which applies to all members, for fixed costs – i.e., expenses such as maintaining poles and wires that don’t change based on how much electricity members use – and a system delivery charge if they consume less than a certain amount of power. Net metering customers are not being subsidized in this current state. All members of HEA pay for the fixed costs, with the $20 member charge, needed to run the electric co-op. All HEA members have varying energy needs that reflect on their monthly bills. 

Wall is not alone in his quest to end net metering, claiming it is an unfair subsidy. At the May HEA Board meeting, Mike Jones, a resident of Homer who ran for the HEA board of directors in 2023 and 2024, shared his views on net metering “subsidies”. He believes that “net metering as it’s done in Alaska is really a massive gift to the wind and solar special interests.”

“I think there’s also a movement afoot for the city of Homer to install a bunch of solar in its facilities,” Jones said. “And you ought to get line of sight to that, because it poses an interesting dilemma. When we think about, you know, should an entity like a city get a subsidy from residents of HEA more broadly, some of which includes city members and some of which don’t. It’s just really an interesting dynamic. And you oughta probably dig on that and kind of think through that was net metering really intended ever to be for municipalities to be able to leverage…”

The Net Metering program has no negative impacts on the members of the utility co-op, either financially or on the grid infrastructure. During the May presentation to the board, the topic of discussion was net metering and its impact on HEA members as a whole. In 2023, HEA spent roughly $32,000-36,000 purchasing excess power generated by 568 net metering customers, according to the presentation. In 2023, HEA spent roughly $32,000-36,000 purchasing excess power generated by 568 net metering customers, according to the presentation, an amount negligible to the overall budget. For context, HEA spent $60,000 on their lobbyist for the 2024 legislative session and $379,984 on General Manager Brad Janorschke’s salary in 2022. HEA would need to demonstrate to the Regulatory Commission of Alaska that net metering negatively impacts co-op members, something that Brad Janorschke says they can’t prove. 

“Quite frankly, we have a hard time demonstrating that net metering at 7% [HEA’s net metering cap] has had a negative impact on our system,” Janorschke said. “Because we’re going to be asked to demonstrate that to the RCA. And we’re struggling to demonstrate that financially.” 

Wall’s answer to this is to try leaving the oversight of the Regulatory Commission of Alaska (RCA)…again. “Brad, the question is not if it causes an unstable grid. The question is, are we subsidizing a group of people at the expense of the rest of the co-op owners? And the other question is, if we have entered into an abusive relationship with the RCA, maybe we should put up a vote again and try to remove ourselves so we can manage our co-op without their oversight.” Wall replied. 

Alaska state code lets co-ops deregulate with a majority vote of their members. HEA unsuccessfully attempted deregulating, in 2016-17. The RCA website records that out of 6,896 accepted ballots, 4,854 HEA members preferred to remain under the RCA.

Cook Inlet natural gas is dwindling and still supplies over 80% of HEA’s energy production. Net metering gives members agency to generate their own power, while also generating power for other members when returned to the grid, offsetting our dependence on natural gas. Closing the door on the Net Metering program only hurts HEA and its members. 

Wall and HEA’s board need to learn that HEA members value having the choice to invest in their own energy production and won’t let misguided directors take that choice away. Tell your friends and neighbors they’ll have an opportunity to comment to the board – and hear discussion from their elected representatives on Wall’s proposal – at the July 9th HEA board meeting, which starts at noon at HEA’s Kenai office. They can also join virtually at a link that will be posted here, at the top of the meeting agenda, on July 5.