Consumers across America are feeling the sting of rising prices, from the grocery store to the gas pump. Many of these higher costs are obvious, but some remain hidden like the $40 million in higher electric bills 99 percent of Florida customers pay at the expense of the 1 percent of customers who can afford home solar panels.
We should not pay our neighbor’s power bill, especially when the buck is being passed from wealthier customers to fixed-income seniors and low-income and minority communities.
This issue of fundamental fairness warrants Florida policymakers’ attention.
I first learned of the controversy earlier this year when Green Cove Springs, a small city in Northeast Florida, took up the issue of home solar compensation rates. Upon further reading, I found the Jacksonville Electric Authority (JEA) also revised its rules in 2018. Last year, the Florida Public Service Commission (PSC) held a workshop to review and receive feedback on the issue.
Under the state’s 2008 home solar compensation rules, excess electricity generated by home solar panels is credited at the same rate utilities receive for powering homes. Those credits count against a customer’s monthly bill, resulting in very low or even $0 bills. The problem is home solar users provide only a fraction of the services utilities do while rooftop solar customers generate excess electricity, utilities generate, transmit and distribute electricity, in addition to maintaining, repairing, and upgrading the electric grid. While utilities must supply reliable energy continually, rooftop solar panels are intermittently reliable based upon the weather and often generate excess electricity when the energy is least needed by utilities.
A fairer system would compensate home solar users only for the cost of the electricity the utility purchases from them. I may be old – and old-fashioned – but the value of home solar credits should reflect the value of the costs actually avoided. After all, someone has to pay for maintaining, upgrading, repairing, distributing and transmitting energy since home solar users do not under today’s compensation rules.
As is often the case, these hidden costs of home solar are borne by fixed-income seniors and the poor, who are disproportionately minority communities, at the expense of higher-income earners.
Most Floridians cannot afford to install solar panels at home, let alone pay more on their power bills for the benefit of wealthier families. EnergySage.com estimates the average cost to install home solar in Florida is $13,050. Meanwhile, the average Floridian’s income is $51,000.
The Lawrence Berkeley National Laboratory found the median income of home solar adopters to be $113,000, compared to $64,000 for all homes. That is just not affordable for most families, especially when surveys show half of Americans live paycheck-to-paycheck. Indeed, the U.S. Energy Information Administration found one-third of Americans reported hardship with paying their electric bills. The U.S. Department of Labor found the poorest Americans spend 17 times more of their income on utility bills than the wealthiest.
While I have pointed out some flaws with home solar, I believe it is a wonderful innovation that anyone should have the freedom to pursue. Florida now leads the southeastern United States in solar and ranks fourth nationally in solar generation capacity. Large-scale utility and community solar projects allow everyone to benefit from solar without shifting costs from wealthier customers to the poor.
States around America, both red and blue, are reviewing their home solar compensation rules to address issues of fairness and inequality. I believe Florida policymakers must do the same. It is wrong for struggling seniors, low-income, and minority families to pay more for electricity to keep their wealthier neighbors’ lights on.
John Grant has been practicing law in the Tampa Bay area since 1968. His practice has focused on business law, real property and estate planning and administration. In addition to being in private practice, he was formerly an assistant professor of business law at the University of South Florida College of Business and has also served on the faculty of the University of Tampa and Hillsborough Community College, and served as an instructor for the United States Peace Corps. He currently serves on the faculty of Taylor University teaching law and criminal justice. He is admitted to practice before the Supreme Court of the United States. His firm Tampa Estate Planners specializes in estate planning, trust and probate administration, mediation and elder law. In his public service, he was appointed to the Graduate Fellow Board in the United States Department of Education by President Ronald Reagan. He currently serves on the Florida Commission on Ethics. He was elected to the Florida House of Representatives, and subsequently elected to the Florida Senate, where he chaired the Senate Committee on Education. Gov. Jeb Bush appointed him to serve as Executive Director of the Office of Statewide Public Guardianship, where he oversaw the statewide program for providing guardianship services for Florida’s indigent citizens. For his work on behalf of the elderly and disabled, he was named to the National Senior Citizen Hall of Fame and has been recognized as one of the top Legislators in America for mental health issues. In his local church, Idlewild Baptist, he is an ordained deacon and Bible fellowship teacher. He served on the board of The American Bible Society and was chairman of the America’s Board of the United Bible Societies. He is a Life Trustee of Asbury Theological Seminary, where he served as a trustee for twenty-five years and chaired the Development Committee.