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Advocates say 'SunCredit' flap shows how CPS undervalued rooftop solar

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Solar panels on Hill Electric Co.'s rooftop


Last Thursday, CPS Energy CEO Doyle Beneby threw water on a controversy that burned for nearly a month, delaying a program that would slash how much the public utility reimburses rooftop solar customers for the power their systems produce. While CPS and the local solar industry have at least a year to strike a compromise, critics say there’s lingering concern over how CPS arrived at its proposal, how quickly CPS brass planned on rolling it out, and how the San Antonio utility’s behavior clashed with actions taken by other municipally-owned utilities.

CPS’ abrupt decision to change how rooftop solar customers are compensated for energy they produce panicked local installers last month. CPS insisted that net metering, a scheme in which every kilowatt-hour a rooftop system produces offsets a kilowatt-hour the customer consumes from CPS, threatened to upend the utility’s current model. As ratepayers choose rooftop solar, those fixed costs to maintain power plants, power lines, transformers and meters (so-called “fixed assets”) get pushed onto a smaller pool of non-solar customers, CPS contended. So, to make it “fair to all ratepayers,” and to recover those costs, on April 9 CPS announced it was cutting that reimbursement rate to 5.6 cents per kilowatt-hour, a 44 percent decrease that solar installers claimed would kill the local industry, making rooftop solar systems impossible to sell to residential customers.

The uproar from local solar installers and advocates prodded CPS to backtrack more than once. At first, the utility said solar customers could keep net metering for a decade before being switched to its new rate under its so-called SunCredit system. Then CPS agreed to grandfather those customers for the life of their systems. The April 26 deadline, inconveniently in the middle of Fiesta, was bumped back to May 31.

Still, local installers balked at being given a little less than two months to figure out how to adapt to a new business model.

“I can’t sell a system on 5.6 cents,” an exasperated Billy Hill, owner of Hill Electric, told the Current earlier this month. “CPS is saying their SunCredit will eventually go up in a few years. Well, it kills our industry today. No one will invest in a system that, by today’s rate, takes 20 years to pay off.”

On May 1, installers like Hill flooded City Hall, pleading with Council members to tell CPS to back off. Then came a contentious public meeting between installers, their rooftop solar customers, and CPS reps on May 3. Though CPS attempted to ease their concerns, none left the table happy. CPS spokesperson Lisa Lewis insisted it wasn’t all doom and gloom for installers, given that the utility had been flooded with proposals from customers trying to get in on the net-metering game before the rate change.

Solar San Antonio director Lanny Sinkin had a different take. Customers who had already committed and had investments lined up were rushing in, for sure. But major long-term projects were backing out in droves, Sinkin insisted. “We’ve surveyed 19 companies, with a total of 422 employees here in San Antonio,” he said. “We saw 74 projects canceled or suspended, at a value of $17.7 million.”

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