Environment

In January, Kentucky utility regulators will begin accepting rate cases under the revised Net Metering Act, shaping the future of solar in the Commonwealth.

In a final order issued Wednesday, The Kentucky Public Service Commission said it will hire an outside consultant to help evaluate rates for new net-metering customers based on each utility’s specific costs.

“We’re going to hire a consultant because there are issues of first impression here that the commission is going to need some technical assistance with,” said Andrew Melnykovych, PSC spokesman.

Net-metering cases that go before the commission will change the way new rooftop solar customers are credited for the electricity they put back on the grid.

Under the revised rules, customers with solar panels on their homes will receive a “dollar-denominated bill credit” for the excess energy they feed back into the electric grid. The new law says utilities are entitled to recover all the costs necessary to serve net-metered customers.

Utilities would like to credit net-metering customers less, while solar advocates would like the benefits of renewable energy to be reflected in the credits they receive. Right now, the credits net-metering customers receive have little impact on overall utility rates.

Net-metering rates for new customers won’t change until utilities go before the Public Service Commission.

A spokeswoman for Louisville Gas and Electric and Kentucky Utilities said they haven’t established a timeline for when they intend to file a rate case, but utilities can begin applying for changes as early as January 1.

Both LG&E and Kentucky Resources Council Environmental Attorney Tom FitzGerald said hiring an outside consultant was a step in the right direction.

“I think they have approached this in a very thoughtful way,” FitzGerald said.

They also approved of the commission’s decision to update the interconnection guidelines, which specify how customers can safely hook up to the grid.

“The last time the commission had a look at those interconnection guidelines was in 2008 and our industry has seen a lot of technological change so I think it’s important to review those,” said LG&E spokeswoman Chris Whelan.

Wednesday’s order also includes a summary of arguments from utilities, advocacy groups and the public that will be included in all future net-metering cases that go before the Public Service Commission.

FitzGerald with the Kentucky Resources Council encourages those interested in net metering to read through Wednesday’s order.

“It’s a good synopsis of the range of opinions and the range of articles and perspectives that surround the issue of distributed solar generation and net metering,” FitzGerald said.

Ryan Van Velzer is WFPL's Energy and Environment Reporter.