While scripture admonishes us to “count the cost” before we undertake a large project, the same is true when considering a piece of legislation. In the case of Senate Bill 459, a piece of legislation dealing with solar power, the true cost of the bill’s consequences could end up hurting most electricity customers in Georgia.
Today, Georgians are free to install solar and wind power capacity for their own use at their discretion. For those who can afford them, such "off-the-grid" installations can reduce power bills without disrupting the operation of the power grid that serves all of us. In other words, under current law, the decisions of some when it comes to renewable energy don't affect the rest of us.
The proposed law changes that by allowing private developers of renewable energy to provide renewable energy, primarily solar power, to customers of their choosing. These new installations would be much larger than a simple residential rooftop solar array. And financed by a private third-party developer, their solar energy offerings would offer many a way to use solar power without the high capital cost (many thousands of dollars in most cases) of buying and installing solar panels themselves. Sounds good, right?
But let's remember Luke 14:28, which asks, "For which of you, intending to build a tower, sits not down first, and counts the cost, whether he have sufficient to finish it?" Or in this case, are lawmakers considering who will actually pay for the proposal? Are they counting the cost to electricity customers?
The fatal flaw of the proposal is that it requires regulated power providers to basically treat the new renewable installations as their own, tying them into the grid, installing the transmission lines they need, and accounting for all of the consequences for when the sun doesn't shine. Who pays for all of these added costs? All power customers will, meaning that Georgians unable or unwilling to pay the cost for solar will be coughing up more on their power bill for those who do. Doesn't sound so good anymore, does it?
We've seen a similar situation already in the United States where subsidies have had unintended consequences. In Hawaii, a select group of power customers have saved themselves about $7.4 million in electricity costs by installing solar panels. While the savings was certainly good for them, the millions of dollars in lost revenue to their regulated utility would have been used to pay for a number of fixed costs. To make up for the shortfall, Hawaiian Electric is now being forced to raise its rates between half-a-cent and 1.7 cents per kilowatt/hour. That's about $10 per month per customer on the high end.
You see, no electricity customer lives on an island, even if you do live in Hawaii. The same is true in Georgia. Even customers who buy solar energy remain connected to the grid, taking advantage of services and infrastructure for which they won't fully pay. In other words, those who can't afford or don't want solar power will pick up the slack.
Tripling Hawaii's residential solar capacity sounded like a good idea, but it was too good to be true. Leaders in that state obviously didn't count the cost. Georgia lawmakers should avoid making the same mistake with this proposed legislation. Very few voters will be happy paying higher power bills.
Lance Brown is executive director of the Partnership for Affordable Clean Energy (PACE), a nonprofit organization that is fighting for sensible American energy policy and affordable power rates.