Arizona Senate President Karen Fann in RealClearEnergy: Biden Must Show Courage Against the Left’s Dangerous Environmental Policies

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By Karen Fann

While campaigning for the Oval Office in 2020, Vice President Joe Biden deftly avoided endorsing the “Green New Deal,” a sweeping, radical environmental law authored by Rep. Alexandria Ocasio-Cortez of New York. If implemented, these policies would dangerously cripple American businesses while allowing other countries like China to keep polluting and growing their economies.

Still, Joe Biden and Democrats are feeling emboldened after taking the White House and the Senate, which creates a serious risk of political overreach. Like many, I fear that the incoming administration may try and impose their failed environmental policies on the nation.

In fact, a recent study looked at one of these radical policies that environmental activists around the nation have forced many states to adopt, known as “net metering.” The liberal spin on net metering is that it’s a policy to make rooftop solar panels more affordable and encourage people to put them on their houses. In reality, this controversial policy has placed an unfair economic burden on everyday Americans, who cannot afford $20,000 solar panels on their homes.

Net metering works by requiring that homeowners with rooftop solar panels are paid a high “retail rate” for the electricity they put back onto the grid when their panels are generating excess energy. Who pays these homeowners this retail rate? The electric companies do and progressives think this is a perfect arrangement because the rich and powerful utilities can surely afford it. But, not surprisingly, this narrative in support of net metering policies ignores important facts.

Keep in mind, electric companies are not like other businesses. They are structured and have their rates set by a state regulator, typically the state’s public service commission, which prevents them from making exorbitant profits. These regulators also ensure that customers are charged fair rates.

Net metering is by no means a fair policy. It picks favorites and rewards homeowners with rooftop solar over everyone else. This happens because net metering mandates that customers with private solar – who sell the excess power they generate from their solar panels back to the electric companies – are paid at the retail rate. In other words, they are paid the same price at which the electric company sells its electricity to consumers instead of the lower wholesale-type rate that the electric company buys its electricity. Ultimately, the electric company is forced to shift this added cost onto the rest of its customer base to make up for the lost revenue.

Customers who participate in net metering are not paying their fair share of maintaining the power grid. Understand, a percentage of your power bill goes to grid maintenance. People with rooftop solar still need power at night when solar panels are useless – but these households lower their bills by selling power at retail rates to the power companies during the day. Ultimately, people with private rooftop solar get all the benefits of the power grid, but don’t pay their fair share to maintain the lines, transformers and everything else that makes up the power grid; including the men and women employed by the power companies who work around the clock to maintain the infrastructure.

In Arizona, we have the third-most installed solar PV capacity in the country, behind only California and North Carolina.  While Arizona did originally employ a net metering system, in 2016 the Arizona Corporation Commission repealed net metering and adopted a replacement system for home-produced solar power compensation. Our system of compensation is fairer than a full retail rate net metering system, and locks homeowners into an export rate for 10 years after installation. Every year, the export rate for new home-produced solar decreases by 10 percent.

The problem with net metering is that if the goal is to produce cleaner energy, then doing it one home at a time with rooftop solar panels is inefficient. Rather, we need to work with our electric companies to invest in large-scale energy investments that can produce clean energy in a cost-efficient way. This would mean less pollution, and lower electric bills for all people – not just the wealthy with private rooftop solar installations, who are the real beneficiaries of net metering. We strongly urge the Biden Administration to reverse course and do what is best for the American people.

Karen Fann is a Republican member of the Arizona Senate, representing Arizona Legislative District 1. In 2019, Fann began serving as President of the Arizona Senate.

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