S.C. legislators are nearing a deal to protect the solar industry and guarantee favorable rates to homeowners with rooftop solar panels over the next two years.
The deal follows a crushing defeat by the solar industry in the Legislature less than a year ago.
The plan, to be discussed by a S.C. House committee Wednesday, would eliminate a cap on the expansion of the rooftop solar industry across the Palmetto State. That cap blocked further solar expansion in the Upstate last year, and could do the same in central and eastern South Carolina by this summer if S.C. law is not changed.
The agreement being negotiated only would be good for two years. But solar advocates say it would help homeowners afford rooftop solar panels and keep the solar industry growing until the state Public Service Commission weighs in.
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Under the plan, the PSC would propose how the solar industry should be regulated by 2021, after two years of study.
S.C. power utilities have been wary of the rooftop solar industry, which competes with power companies for customers and revenue. Homeowners who install solar panels on their roofs can reduce sharply the amount of money they pay each month for electricity to SCE&G, Duke Energy or another power utility.
State Rep. Peter McCoy, R-Charleston, said South Carolinians are frustrated with the state’s power utilities and want fewer limits on installing solar panels.
“People are very much wanting that option,” said McCoy, a leader in the effort to expand solar power. “Being tied to a utility that is a monopoly is very disturbing to folks, and disturbing to me as well.’’
Solar has become popular among many S.C. residents upset that the state pays some of the nation’s highest electric bills. SCE&G, recently acquired by Dominion Energy of Virginia, suffered withering criticism in 2017 and 2018 after charging its customers billions of dollars for a nuclear power project the utility abandoned.
Last year, most S.C. House members voted for a bill to eliminate the 2 percent cap on solar power in South Carolina. But power utility allies used a technicality to derail the bill.
After part of Duke Energy’s S.C. territory reached its solar cap last summer, the utility stopped offering customers favorable rates for the solar power they produce and sell back to the utility. Duke later cut a deal to continue that program in northwest South Carolina, but it expires March 15.
The cap on solar power has not been reached in SCE&G’s territory in central South Carolina, but that is expected to happen later this year.
Solar industry boosters say passing legislation to eliminate the solar cap is vital. If not eliminated, the solar industry could lose more jobs, as it did last year when Duke reached its cap, solar officials say.
McCoy said he is optimistic the House will pass solar-friendly legislation this year.
“The last thing anybody wants on the House floor right now is a fight over solar, especially after what we went through last year,’’ McCoy said. “People are on board with this.’’
In a statement Tuesday, SCE&G said it wants to help customers.
“SCE&G, a wholly owned subsidiary of Dominion Energy, is optimistic that our collaboration with solar installers, developers, not-for-profit organizations, as well as utilities and cooperatives throughout the state, will yield the best results for all our customers,’’ the utility said. “Our goal has been to continue to create energy options that are best for our customers.’’
The state’s rooftop solar industry has grown since 2014, when the Legislature approved a law that lifted some restraints on solar power. At the time, South Carolina was one of the least friendly places for sun power in the country.
But the 2014 law also put a cap on rooftop solar expansion, in part because of concerns by power companies about competition.
At issue is the future of a program called “net-metering,’’ which, under the 2014 law, guarantees customers the same price for solar energy that they sell to power utilities as the utilities charge them for power. Most people who have solar panels use a combination of the power they produce and traditional power.
Utilities say the net-metering system effectively subsidizes rooftop solar. Customers who sell solar power back to the grid use utility power lines for free as well as depending on utility-generated power when the sun is not shining, for instance.
Under the compromise, the existing net-metering program would continue for two years.
The rooftop solar compromise is part of a larger bill that also includes ways to help resolve disputes between industries that develop solar farms and power companies that buy the power that those farms produce. Large solar companies say some utilities now underpay for their power, preventing solar power from expanding in the state.
One sticking point to a compromise is a subsidy that power utilities now receive to offset revenues they lose as a result of solar’s entry into South Carolina. Utilities do not want to give that up that subsidy, negotiators said.
But rooftop solar lobbyist Tyson Grinstead and John Tynan, director of the Conservation Voters of South Carolina, said they are optimistic a deal will be worked out.
“Overall, this solves a number of the short-term issues we are facing on clean energy and market competition in South Carolina,’’ Tynan said. “It stops the bleeding in the short term, but helps us find and identify a long-term pathway.’’