November 16, 2021
New Bill Would Make Solar Accessible to More Wisconsinites
On October 13, Senate Bill 702 was introduced, a bill that would remove a significant and needless barrier to the widespread deployment of solar energy in Wisconsin.
We got some exciting news out of the Wisconsin legislature a few weeks ago. On October 13, State Senator Robert Cowles (R-Green Bay) and Representative Rachael Cabral-Guevara (R – Appleton) introduced Senate Bill 702, a bill that would remove a significant and needless barrier to the widespread deployment of solar energy in Wisconsin.
The bill would clarify the legality of a financing mechanism known as “third-party ownership.” Third-party ownership is something we at ELPC have advanced for years. Third-party ownership (TPO) is a financing tool for renewable energy that has expanded greatly over the last few years in many other states. TPO helps citizens of all types, businesses, nonprofits and houses of worship to install their own renewable energy systems. Of course, the monopoly utilities oppose it.
Why Third-Party Ownership?
- While it often saves money in the long term, installing solar can involve significant up-front costs. Lots of local governments, schools, non-profits, and individuals would love to have rooftop solar on their buildings (or other renewable generation sited on their property). It lets them generate their own power and save money over the long term on lower electricity bills. However, they are accustomed to paying monthly utility bills, not the up-front costs of putting a new rooftop solar project on their buildings.
- Third-party ownership makes solar accessible. A third-party (usually the solar developer) owns and operates the solar panels, which are installed on the customer’s property. Instead of paying an up-front cost, the customer pays a monthly lease fee, or pays based on the amount of electricity produced. This financing model also allows for use of tax credits, even when the customer doesn’t pay enough taxes to directly use the credit or because they are not taxed (e.g., because they are a local government, school, nonprofit, or low-income individual).
Utilities Should Not Monopolize Solar Power in Wisconsin
In lots of states, including many around the Midwest, third-party ownership is widely available. But not in Wisconsin. You’re probably wondering, “Why not?!”
The fact is that monopoly electric utility companies in Wisconsin don’t want their customers to build their own solar, because that means they’re probably buying less power from the utility. Some of these utilities have taken the unsupportable position that third-party financing is illegal because it would make that third-party owner a “public utility.” ELPC has explained in detail why that is simply not the case – Wisconsin statute, case law, and public policy all support the finding that third-party ownership is entirely legal.
But some of these monopoly utilities are abusing their positions and preventing their captive customers from developing solar using a third-party ownership model. We Energies, for example, has refused to interconnect third-party financed solar systems into the electricity grid. The utilities’ position is contrary to the law and the public interest, and would inappropriately extend the utilities’ monopoly into the realm of distributed solar, slowing development and limiting customer options.
Solar advocates have tried for years to resolve this issue. There have been multiple proceedings and cases filed, seeking clarity from the Public Service Commission and state courts—to date, these have been unsuccessful. This bill is a new approach to unequivocally establish, once and for all, that third-party ownership is legal and that utility monopoly can’t abuse their power by refusing to interconnect TPO systems. As a newly introduced bill, LRB 1550 has a ways to go – but if it passes, this could be a game-changer for distributed solar.