Florida's utilities keep homeowners from making the most of solar power

Florida's utilities keep homeowners from making the most of solar power

July 11th, 2019 by Ivan Penn / The New York Times in Business Around the Region

ST. PETERSBURG, Fla. — Florida calls itself the Sunshine State. But when it comes to the use of solar power, it trails 19 states, including not-so-sunny Massachusetts, New Jersey, New York and Maryland.

Solar experts and environmentalists blame the state's utilities.

The utilities have hindered potential rivals seeking to offer residential solar power. They have spent tens of millions of dollars on lobbying, ad campaigns and political contributions. And when homeowners purchase solar equipment, the utilities have delayed connecting the systems for months.

Solar energy is widely considered an essential part of addressing climate change by weaning the electric grid from fossil fuels. California, a clean energy trendsetter, last year became the first state to require solar power for all new homes.

Top 10 solar states

1. California - 25,016 megawatts

2. North Carolina - 5,467 megawatts

3. Arizona - 3,788 megawatts

4. Nevada - 3,452 megawatts

5. Florida - 3,156 megawatts

6. Texas - 2,957 megawatts

7. New Jersey - 2,829 megawatts

8. Massachusetts - 2,535 megawatts

9. New York - 1,718 megawatts

10. Utah - 1,661 megawatts

Source: Solar Energy Industries Association

But many utilities across the country have fought homeowners' efforts to install solar panels. The industry's trade organization, the Edison Electric Institute, has warned that the technology threatens the foundation of the power companies' business.

In Florida, utilities make money on virtually all aspects of the electricity system — producing the power, transmitting it, selling it and delivering it. And critics say the companies have much at stake in preserving that control.

"I've had electric utility executives say with a straight face that we can't have solar power in Florida because we have so many cloudy days," said Rep. Kathy Castor, a Democrat from the Tampa area. "I have watched as other states have surpassed us. I think that is largely because of the political influence of the investor-owned utilities."

The state's utilities have been expanding their own production of solar power. But Florida is one of eight states that prohibit the sale of solar electricity directly to consumers unless the provider is a utility. There is also a state rule, enforced by the utilities, requiring expensive insurance policies for big solar arrays on houses.

In 2009, a measure to require a certain amount of energy to be generated from renewable sources passed the state Senate but died in the House of Representatives when the utilities fought it. Solar proponents have been unable to find legislative traction for similar measures since then.

Mayor Rick Kriseman of St. Petersburg — the site of Duke Energy's Florida headquarters — has argued for changing the way utilities are regulated so they would embrace more energy efficiency, residential solar power and energy storage. The companies essentially see the solar-equipped homeowner as a competitor, not a customer, he said.

"If your profits are based on consumption, where's your incentive to reduce electricity use?" Kriseman said.

 

A Homeowner's Struggle

Art Graham, chairman of the Florida Public Service Commission, which regulates Duke, Florida Power & Light and other investor-owned utilities, said simple economics was one reason the state had lagged in adopting renewable energy sources. Because Florida has kept electricity rates lower than those in the Northeast and California, he said, the cost savings for homeowners in switching to solar power are more limited.

But there are other obstacles. Timothy Nathan Shields is still stunned by the resistance he faced from Duke, the state's second-largest utility, when he wanted to put solar panels on his home.

Shields, a 57-year-old retired nurse, wanted a system to cover the electricity needs of his 2,000-square-foot house in Largo, north of St. Petersburg, as well as the cost of charging his electric car. So a year ago he bought a setup twice the size of the average rooftop system from Sunrun, the leading residential solar company.

First, Shields said, a Duke representative told him that he would not benefit much from solar power because "it rains." Then the utility told him that it wouldn't save him any money. After he made a commitment to buy the system, Duke told him that it needed to be insured, citing its size and saying it could "harm the electric grid."

So he bought a $1 million insurance policy costing $200 a year.

"It's absurd," said Brad Heavner, policy director for the California Solar and Storage Association, a trade group. "There's no way you can justify that based on studies of the risk. I would call that an outrageous solar requirement." He said he was not aware of such a rule in other states.

Sunrun installed Shields' system in days. But Duke took two months to turn it on, forcing him to continue to pay electric bills of as much as $310 a month. He will pay $240 a month for the system for the next six years, when it will be paid off, plus a monthly fee of $11.57 to Duke for a grid connection.

"Every time I turned around, they would drag their feet," Shields said. "They want you to think it's hard and horrible and difficult."

Sun power in the Southeast

In most Southeastern states other than North Carolina, the installed solar generating capacity is below the U.S. average because electricity from other sources is cheaper than in the rest of the country and state and federal utility rules are less favorable for self-generated solar power.

North Carolina - 5,467.2 megawatts

Florida - 3,155.5 megawatts

Georgia - 1,571 megawatts

South Carolina - 780.7 megawatts

Virginia - 775.3 megawatts

Tennessee - 353.5 megawatts

Alabama - 282.7 megawatts

Mississippi - 235.2 megawatts

Kentucky - 43.6 megawatts

Source: Solar Energy Industries Association

 

 

Randy Wheeless, a Duke spokesman, said that he regretted Shields' experience, but that the company was simply following state requirements for larger home systems. The utility has been reducing connection times and adding as many as 750 rooftop solar customers a month, he said.

From the state's perspective, Graham, the chief regulator, said, "I think we definitely could do some things differently" — like revising the policy that will cost Shields as much as $6,000 in insurance premiums over the life of his system, potentially more than 30 years.

 

Political Dollars

The experience of homeowners like Shields has largely been shaped by the utilities' political spending.

From 2014 through the end of May, Florida's four largest investor-owned utilities together spent more than $57 million on campaign contributions, according to an analysis by Integrity Florida, a nonprofit research organization, and the Energy and Policy Institute, a watchdog group. FPL, the state's largest utility, accounted for $31 million of that total.

The utilities also hired enough lobbyists to have one for every two lawmakers in Tallahassee. From 2014 through 2017, the four companies spent $6 million on lobbying, Integrity Florida reported.

Sunrun broke through one of the barriers to rooftop solar last year when it won approval to lease solar panels to homeowners, a step subsequently taken by Vivint Solar and Tesla. But regulators stopped short of allowing solar companies to own the panels and simply sell the power directly to consumers, as they can in at least 27 states, the District of Columbia and Puerto Rico.

"There's no solar competition happening," said Abigail Ross Hopper, president of the Solar Energy Industries Association, a trade group.

When it comes to the expansion of the utilities' own solar arrays, Florida's growth rate led the nation in the first quarter, and the state is positioned to hold that ranking for the next six years, according to the energy consulting firm Wood Mackenzie and the Solar Energy Industries Association.

Still, solar energy accounted for only 1% of electricity generation in Florida last year, far less than the 19% in California and nearly 11% in Vermont and Massachusetts, the association said. The state relies largely on natural gas, and several utilities get as much as a quarter of their power from coal.

 

A Vision for the Future

FPL points to its role in a particular bet on a solar future: Babcock Ranch, developed near Fort Myers by a company that extols it as the nation's first sustainable town. The power company built a solar farm that largely supplies the town's energy needs.

FPL announced four similarly sized projects in April, and Duke says it is also building farms that size.

"FPL has been working for many years to advance solar energy while keeping customer bills low," said Mark Bubriski, a company spokesman. The utility said it plans to add enough solar capacity to power about 1.5 million homes and provide 20% of its total generation by 2030.

During legislative hearings in Tallahassee, Syd Kitson, the developer of Babcock Ranch, which will include 20,000 homes when fully developed, proposed building a town that could showcase the benefits of solar power.

"I'm an environmentalist who is a developer," Kitson said. "It is the Sunshine State, so it made a lot of sense to us."

But solar proponents feel the utilities need to be pushed further.

Scott McIntyre, chief executive of Solar Energy Management, a statewide leader in commercial solar power based in St. Petersburg, said the gains the state appeared to be making were little more than a facade.

"Florida is not going to do any type of energy policy that benefits consumers, not for a long time," McIntyre said. "They just keep making the hurdles higher and higher."


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