Minnesota electric cooperatives and municipal utilities are owned, managed and operated by the customers they serve. That means we aren’t focused on stock prices or faraway shareholders. We exist to provide reliable, affordable, safe and environmentally sensitive electric service to all our customers.
Because we are consumer-owned, we are also responsive to the unique needs of our communities. Consumer-owned utilities have developed innovative renewable-energy projects. These projects allow our customers to invest in our renewable-energy future in a fair and equitable manner.
This legislative session, consumer-owned utilities are advocating for reform to a law we believe is inherently unfair to the majority of our customers. Small-scale wind and solar producers, known as distributed generators, currently sell their excess generation back to the utility at retail rates (the price at which the consumer-owned utility sells electric power to customers). When distributed generators produce as much energy as they use, they don’t pay anything for the cost of operating the electric grid that they rely on when their wind or solar installation is not producing energy. These costs are built into the electric rates paid by utility customers; if a distributed generator is compensated at the full retail rate, the generating customer is not making any contribution toward the cost of operating the grid; those costs are shifted onto other customers.
We believe this is unfair and that distributed generators should pay their share to maintain the grid that they need in order to sell their excess generation and keep their lights on when the sun isn’t shining or the wind isn’t blowing. The reform we are advocating doesn’t do away with net metering, but it allows consumer-owned utilities to collect the actual cost to serve distributed generators (“Why would Minnesota choose to backslide?” April 21). This additional fee isn’t arbitrary or punitive, but is tied to the true cost to maintain the grid.
We aren’t asking to end net metering, and we will continue to support distributed generators with the technical know-how and technology needed for their systems to operate with the electric grid. However, we believe this reform is fair and needed to ensure that costs don’t continue to shift from distributed generators to the rest of our customers.
Jack Kegel is executive director of the Minnesota Municipal Utilities Association. Darrick Moe is president and CEO of the Minnesota Rural Electric Association.