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Net Metering Provokes Broader Reaction Against Energy Efficiency by PUC’s Nelson

I worked with a Dakota Rural Action committee to advocate a net-metering policy this year in Pierre. The Public Utilities Commission joined the industry in killing that proposal.

In a fit of reactionary wagon-fixing, Public Utilities Commissioner Chris Nelson is now pointing to the net-metering effort as a reason to get rid of other energy-efficiency incentives:

MidAmerican Energy Company started its energy efficiency programs in 2009. The PUC approved the company’s updated plans Tuesday, but the occasion sparked a philosophical debate among commission members.

Nelson used one category as an example.

“We’re asking 830 to pay for one person’s improvements. Some of those 830 may be competitors who are paying for one’s improvements,” Nelson said.

He said the PUC during legislative session opposed net metering, where people generate electricity through solar panels and wind turbines and sell the power to utilities because all other ratepayers pay more to benefit those independent producers.

“And we said that was wrong,” Nelson said.

He said energy-efficiency programs are doing the same thing. He acknowledged the numbers show it was probably valuable but a line needs to be drawn [Bob Mercer, "PUC vote reflects possible change ahead in philosophy for energy-efficiency incentives," Aberdeen American News, 2013.03.26].

The program provides value, but Commissioner Nelson sees the need to draw a philosophical line. Never mind that studies have found net metering has little if any impact on the rates non-participants pay. Never mind that promoting energy efficiency benefits all consumers by lowering demand and delaying the need to build new generating plants that raise rates for everyone. Commissioner Nelson needs to send a philosophical message, and by gum he's going to send it to everybody... even those utilities making perfectly sensible investments in energy efficiency.


  1. Donald Pay 2013.04.03

    Nelson's philosophy makes perfect sense if you were living in some Ayn Randian third world state, where the fossil fuel utilities controlled everything. Oh, wait.

  2. Vincent Gormley 2013.04.03

    Chris Nelson ceased making sense in 2010 when he decided to go "birther".

  3. Frank James 2013.04.03

    It's a very short term economic assessment of the benefits of energy efficiency and net metering. You would think a conservative would take a longer view of programs and see the energy efficiency helps extend the need to build any new power production be it renewable or conventional. Net Metering gives regular people the incentive to invest in renewable energy projects reducing the need for utilities to build new production as well.

  4. Donald Pay 2013.04.03

    Let's put it in a different way. There are thousands, perhaps hundreds of thousands, of potential energy entrepreneurs ready to use their rooftops to reduce fossil fuel usage. All they need is for Nelson to provide a fair market, rather than to do the bidding of a subsidized monopoly that seeks to restrict the entrepreneurial spirit of Americans.

  5. caheidelberger Post author | 2013.04.03

    I'm with you, Frank and Donald! Energy efficiency is not a redistribution scheme for a lucky few who choose to build solar panels; it's a long-term investment to keep rates low and the environment cleaner for everybody.

  6. John 2013.04.03

    Once again, sign, eye roll, South Dakota is leaving itself in the dust where it should be leading. Conservation is conservative. Net metering rewards conservation. Net metering is self-reliance exemplified.

    Apparently if we take Nelson's argument to its logical extreme we arrive at the fallacy that my use of LED light bulbs screws my neighbor and Black Hills Power. Then I guess my geothermal heater / air conditioner must be the devil to BHP, gas company, that their corporate lackey - the PUC.

    Can't wait to get the solar panels on the roof - but one project at a time . . .

    Vince is right; Nelson lost it in 2010, and apparently he ain't coming back.

  7. Les 2013.04.04

    A whole lot of backslapping going on here. Corey, splain your plan.
    Does it take into effect the cost of demand generation, transmission costs, liabilities on providers with these unlicensed 3rd, 4th and 5th party providers, complex billing process costs? Is the return on investment for all these folks waiting on Nelson to "just say yes", in line with the dependability of their production? Were you providing tax incentives or guaranteed rates for all those willing to jump the gun into green energy? What was your projected cost to the power provider for hook up and testing and maintenance? These and dozens of other boring questions remain unasked and probably unanswerable.
    Were you willing to guarantee no tolerance for liberal slander from the households utilizing green energy, oh wait, that's Vincent and John's very important concern. Lead on fellas.
    Btw the study shows me a link with a whole lot of negative and a bunch of subjective data. Not a good support for net metering for anyone willing to digest it.
    I for one believe home based energy production is the future but not by socialist warfare, breaking the backs of current providers who most of us love to hate.

  8. Donald Pay 2013.04.04

    Please, Les. An entrepreneurial utility would be looking at how the company could make money from birthing new energy, and leading the way. What we've got is a utility industry stuck with bad investments in dinosaur technologies that got massive subsidies, and they want us to continue to pay them when they should be paying us.

  9. Les 2013.04.04

    That would be you and I Donald, I agree, but. Lets not throw the baby out with the bath water. We will pay for the process either way and as with getting rid of coal we now see annual requests for rate increases to shut down coal and build all the new nat gas power. We used to have ten to twenty year frames between rate requests..
    My goal would be to look for the ways to integrate the home based production without throwing it on the backs of all those unable to afford all these cost increases. I only see that possible through timely processes not the knee jerk that Obama has done to coal and that consumers nation wide are now paying for the wreck that could have been spread over fifteen years.

  10. larry kurtz 2013.04.04

    Every utility in the chemical toilet is a subsidized monopoly that greases SDGOP with dark money.

  11. Les 2013.04.09

    SD rural electrics will not receive in the next 100 years what one or two neighborhoods in Sandy or Katrina got in one shot Lar.

  12. larry kurtz 2013.04.09

    The feds could take South Dakota off the grid for what it costs to maintain it in the state.

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