Solar choice amendment could cost $1.1B, think tank study says
The proposed solar power constitutional amendment — Floridians for Solar Choice — could cost ratepayers as much as $1.1 billion per year, according to a study released Wednesday by the James Madison Institute, a conservative think tank.
Floridians for Solar Choice would allow people to contract with a company to install solar panels on their roof and buy that energy, instead of going through an existing utility company. Right now, to use solar power, a person has to buy the panels, which are very expensive.
However, James Taylor, the study’s author, and Sal Nuzzo, the institute’s vice president of policy, say it amounts to a carve-out for solar power companies and on the backs of the rest of the state’s energy users.
But the study makes some assumptions about both the possible growth of solar power and the potential cost impacts of people moving off the existing power grid. And James Madison Institute has close ties to utility companies that oppose the amendment.
Here’s how they get to that $1.1 billion:
“Our utilities are required to maintain 100 percent of grid capacity, regardless of whether a location provides its own energy through wind or solar,” Nuzzo said.
This means that the power infrastructure has to be able to serve everyone in an area, even if they aren’t a customer of the utility. And that means maintenance costs, which the James Madison Institute report says would be shifted to other Floridians who do pay utility costs.
If 8 percent of Floridians switch to solar power in the third year after Floridians for Solar Choice passes (itself a big feat), then the total cost shift hits $1.1 billion, Nuzzo and Taylor say.
“They would then be free-riding, so to speak, on the rest of the traditional utility ratepayers,” Nuzzo said.
But there’s a big disclaimer here: James Madison Institute has a close relationships with the state’s large energy companies, which are fighting Floridians for Solar Choice and raising a lot of money to do it.
Stan Connally, president and CEO of Gulf Power, sits on the institute’s board.
His company contributed $640,000 to Consumers for Smart Solar, a political committee pushing a competing solar power amendment, which would solidify the existing regulations for solar power in the constitution.
The other utilities have contributed huge amounts to the committee this year, as well:
* $1.05 million from Florida Power and Light
* $1 million from Duke Energy
* $841,000 from Tampa Electric Company
In response to the study, Floridians for Solar Choice released a statement, pointing to the James Madison Institute's ties with the utilities and calling their report wrong.
"The utility business model rewards building expensive power plants," said Debbie Dooley, president of Conservatives for Energy Freedom, one of the groups backing the solar choice plan. "The more money the monopoly spends, the more money they make. Solar will eat into their profits. As long as this model and the current market barriers remain in place, the monopolies would rather keep building expensive power plants and spreading misinformation instead of doing what is in the best interest of their consumers."