States Pull Back Solar Incentives

**Kusha Navadar** (0:10)
It's The Brian Lehrer Show, I'm Kusha Navadar. I'm filling in for Brian today here on WNYC. So as some listeners know, when I'm not hosting here, I co-host a public radio show called Climate One. It's about solutions and stories as our environment changes. And lately, we've been talking a lot about solar power, and I think that may be of interest to New Yorkers and beyond for Health and Climate Tuesdays.
As the world gets hotter and electricity becomes more expensive, a lot of people have been turning to solar panels they install. The idea is that the solar panel will capture energy during the day when you're often using the most electricity, and the utility company can buy excess energy you produce during that time from you.
You benefit in savings, the grid benefits in stability, and the earth benefits with lower emissions. That's the theory anyway. Today, states are making it harder to save money with this design. Over the last decade, in fact, according to my next guest, more than a third of US states have changed the rules, allowing utilities to pay homeowners less for that excess energy. And for a lot of people, when it comes to buying solar panels today, the math is less attractive. Here to walk us through what those changes are, and what they mean for us, for utilities, and for the planet, I'm joined by Francesca Paris, a reporter for The Upshot from The New York Times. Francesca, welcome to the show.

**Francesca Paris** (1:29)
Glad to be here.

**Kusha Navadar** (1:30)
So nice to have you in the studio with me. I want to start at the heart of your reporting. So across the country, states are changing the rules about how a utility company can buy back power that somebody generates with their solar panel. And you talk about a shift from what's called net metering to net billing. Is that the crucial shift to focus on?

**Francesca Paris** (1:50)
Yeah, so when you generate energy with solar, you use it in your house. But because you're using electricity all day and you're only generating solar when the sun is out, you have sort of an imbalance between when you create power and when you use power. So you'll actually often have extra power in the middle of the day. That goes back to the grid. And states and utilities can decide how much they want to pay you for it. They are paying you less in a lot of places now than they used to.

**Kusha Navadar** (2:15)
And so is that less because of a shift from net metering to net billing? Is that right?

**Francesca Paris** (2:21)
Net metering is what we call it when they pay you effectively the same rate that you pay them. So in New York, that's something like 30 cents per kilowatt hour. We have pretty expensive electricity, similar a little lower in New Jersey. And they give you one for one credits that electricity you send them in the middle of the day offsets what you use, say, at 8 p.m. after the sun is down. Under net billing, they pay you a lot less. It varies. It can be two cents, 10 cents, somewhere in between. Depends on the state, the utility.
But they give you less back. So it's not one for one. The energy you're giving them does not actually necessarily offset the rest of the electricity that you use.

**Kusha Navadar** (2:56)
So let's break that down a little bit because there are numbers there. I want to make sure that I'm getting it right. There's net metering and then there's net billing. Net metering is more favorable for the consumer. It's basically the utility company is taking whatever electricity it wants and the value of it is how much they would charge you for it, right? And then with net billing, it's some rate that the utility company decides on.
You don't have control over it, and it's generally always less than what they would be charging you for.

**Francesca Paris** (3:26)
Yeah, it's always less. The states sometimes set a specific amount, sometimes utility sets an amount and the state approves it. In some places like California, it's actually a different rate depending on the month, the hour, the day that you send it back.

**Kusha Navadar** (3:39)
So how much savings is the typical person missing out on if their utility company shifts from net metering to net billing?

**Francesca Paris** (3:47)
It depends on a ton of stuff. It depends on how much solar is generating. It depends on how much you use and how you use it and when you use it. But it can be hundreds of dollars. In some cases, it can be thousands of dollars less.