On April 1, NorthWestern Energy filed a 40-page benefit-cost analysis of customer-owned solar generation with the Montana Public Service Commission. Depending on who you talk to, that document is destined to either re-energize the discussion over small-scale solar or flat-out shape Montana’s energy future.
The former stance is held by NorthWestern, according to spokesperson Butch Larcombe. The utility was directed to conduct the study by House Bill 219, passed by the 2017 Legislature, and commissioned third-party contractor Navigant to do the work. Larcombe says the key finding in Navigant’s analysis is the value of net-metered power to NorthWestern: between $.035 and $.045 per kilowatt hour. That’s well below the current 11-cent rate at which small solar generators are credited for the electricity they pump into the grid, a discrepancy that appears to support the utility’s primary contention throughout the state’s years-long net-metering debate.
“They’re fairly intensive users of the grid just like anybody else,” Larcombe says, “and we don’t think it’s fair that they should be able to avoid paying their share when non-net-metering customers — the majority of our customers — do pay their fair share.”
Larcombe estimates the current number of net-metering customers in Montana at about 2,100.
The Montana Renewable Energy Association sees the study as a big deal, too, for precisely the reason that it props up NorthWestern’s past assertions. In fact, executive director Andrew Valainis says, the low value placed on net metering “raises a lot of concerns about bias” — concerns he hopes are unfounded. That’s why Valainis is keen to get a look at the data and the methodologies behind Navigant’s analysis. The study was supposed to consider a number of potential benefits of customer-generated solar; Valainis finds it troubling that several of those are assigned a zero-dollar value.
“One of our contentions this whole time is that there are these ancillary benefits like the job creation, the ability for customers to control their energy costs, that are going to be significantly impacted by this study, and yet they don’t have a value in here,” Valainis says. “I think that’s something the PSC is going to have grapple with.”
What both sides agree on is that the analysis itself is not an impetus for action. Rather, Navigant’s work will be a key consideration when NorthWestern files for a full rate review this fall. That, Larcombe says, is when the questions and concerns of the PSC, the utility and other interested parties will be hashed out. He doesn’t rule out the possibility of a robust debate in the 2019 Legislature.
“It’s going to be controversial. It always is,” Larcombe says. “It’s just economic reality. Some of the people that are proponents, people that are involved in selling solar panels and that sort of thing, they look at it as us trying to discourage renewable energy development. We don’t see it that way at all.”