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Senate kills bill to expand size of ‘net-metered’ renewable-power systems

The state Senate Monday narrowly killed a measure to allow homes and businesses to install larger renewable-power systems that can sell excess power they generate back to the utility.

The Senate voted 26-24 to kill Senate Bill 247, which supporters said would help create more work for businesses installing individual solar- and wind-power systems in Montana.

“I think it’s clear from what we know about the way the (law) has been used, that Senate Bill 247, at its core, is a jobs bill for small businesses in Montana,” said Sen. Mike Phillips, D-Bozeman, the sponsor of the bill.

SB247 would have doubled the size of allowable “net-metered” projects in Montana from 50 kilowatts to 100 kilowatts. Under net metering, a home or business installs its own small power-generating system – usually wind or solar – and gets financial credit for power it generates but doesn’t use.

That power flows back onto the utility’s system and is distributed and sold to other customers.

Solar- and wind-power system installers testified earlier this month that raising the allowable size to 100 kilowatts would allow them to install larger commercial systems for businesses that wanted to save money on power.

NorthWestern Energy, the state’s largest electric utility, opposed the measure, saying earlier this month it doesn’t want to expand a program that is shifting the cost of electricity from the net-metered customers to other customers.

Sen. Alan Olson, R-Roundup, spoke against the bill Monday, saying NorthWestern has to pay the net-metered customers for the entire cost of the excess power it receives, but then can charge other customers for only part of that cost.

“If this bill said you’re only reimbursed for the power (costs) you displaced, I wouldn’t have a problem,” he said.

Supporters of the bill, however, said if this cost shift exists, it’s a mere “rounding error” for the utility.

“We’re talking about a cost shift to other customers, if it even exists, something like $400,000 a year, on more than $300 million in annual revenues,” said Sen. Greg Jergeson, D-Chinook. “It’s less than 1 percent of the total electricity that is delivered to customers of this company.”

Phillips called the difference “inconsequential” to the utility and noted that the state Public Service Commission has the power to address concerns about cost-shifting, but in the 14 years since the net-metering program began, hasn’t done so.

“I can only conclude that it’s not an issue,” he said.

The vote against SB247 largely followed party lines, with Republicans opposed. However, two Democrats – Sens. Jim Keane of Butte and Gene Vuckovich of Anaconda – voted “no” on the bill.

Five Republican senators supported it: Taylor Brown of Huntley, Llew Jones of Conrad, Verdell Jackson of Kalispell, Jim Peterson of Buffalo and Art Wittich of Bozeman.

A NorthWestern Energy spokesman said earlier this month that only 1,000 to 1,100 of the company’s 340,000 electric-meter customers have net-metered systems.