MLGW just rolled out their new time-of-use rates and it's devastating for solar customers here in Memphis. Peak hours are 2-7 PM during summer when solar production drops off. Off-peak rate is only $0.08/kWh but peak is $0.28/kWh. Solar customers are getting minimal credits for midday production but paying premium rates for evening consumption. Had three clients this week asking if they should disconnect their solar systems. This can't be legal under Tennessee net metering laws.
MLGW time-of-use rates killing solar ROI - need strategies
Randy, similar situation here in Pittsburgh with Duquesne Light. They restructured TOU rates specifically to screw solar customers. Peak hours conveniently align with when solar production tapers off. We're challenging it as discriminatory against distributed generation. The key is proving the rate design intentionally targets solar customers versus being based on actual system costs.
This is happening nationwide. Utilities are using "cost of service" studies to justify rate designs that penalize solar. Problem is these studies often ignore the grid benefits of distributed generation - reduced transmission losses, deferred infrastructure investments, etc. Randy, has anyone done an independent cost-benefit analysis of solar in MLGW territory?
The solution is battery storage but that adds $15-20K to system cost. Some of my Kansas City clients are installing batteries specifically to shift solar production to peak hours. Tesla Powerwall 2 can store 13.5 kWh - enough to cover most residential evening peak demand. ROI drops but still pencils out over 15-20 years with these extreme TOU differentials.
Kevin's right about batteries but that shouldn't be necessary. The Tennessee net metering statute requires utilities to credit solar production at "avoided cost" but doesn't specify time-of-use adjustments. Randy, you might argue that MLGW's TOU crediting violates the spirit of net metering by forcing solar customers onto disadvantageous rate structures.
John, I've been researching the Tennessee statute language. The problem is it says utilities "may" offer net metering, not "shall". MLGW is arguing their new TOU structure is still net metering, just time-differentiated. Hard to challenge legally when the statute gives utilities so much discretion. We need stronger state legislation.
Randy, look into whether MLGW properly noticed this rate change. Pennsylvania requires 60 days public notice for residential rate changes affecting more than 100 customers. If they didn't follow proper procedures, that's grounds to challenge the implementation timeline even if you can't challenge the rates themselves.
Also check grandfathering provisions. Many states protect existing solar customers from rate changes for 10-20 years from their interconnection date. If Tennessee has similar protections, your existing solar clients might be exempt from the new TOU rates. New installations would be stuck but existing ones could maintain current net metering terms.
Another strategy is demand response programs. Some utilities offer credits for allowing them to control battery charging/discharging during peak events. If MLGW has similar programs, solar + battery customers could earn additional credits to offset the punitive TOU rates. Turn their own game against them.
Good suggestions everyone. I'm organizing existing solar customers to file a class action complaint with the Tennessee Regulatory Authority. The rate change affects over 2,000 MLGW solar customers and reduces their systems' value by 40-60%. That has to constitute material harm sufficient for regulatory relief. Will keep you posted on progress.
Randy, document everything about customer financial impacts. Specific dollar amounts, reduced system ROI, payback period changes, etc. Regulators need concrete evidence of harm, not just theoretical complaints. Also get testimony from solar installers about how this affects new business - economic harm to the entire industry strengthens your case.
One more angle - environmental justice. If the new rates disproportionately harm low-income solar adopters or communities with higher solar penetration, that could violate state environmental equity policies. Tennessee might have environmental justice requirements that trump utility rate-setting discretion.
Duane, interesting angle. East Memphis and Midtown have much higher solar adoption rates and are predominantly minority communities. If the TOU rates disproportionately impact these areas, that could be grounds for discrimination claims. Adding that to our complaint strategy. This fight is just getting started.
Keep fighting Randy. Utilities are testing these anti-solar rate designs in smaller markets before rolling them out statewide. If MLGW gets away with this, every utility in Tennessee will copy it. Setting precedent here protects solar customers across the state. Document everything and make it expensive for them to screw over clean energy adopters.