Dive Brief:

• Iowa’s 3,000-member Pella Cooperative Electric has withdrawn its proposal to the Iowa Utilities Board to impose a $57.50 monthly fee on customers with solar panels, in addition to the $27.50 monthly fixed fee all the co-op’s residential customers pay.
• The total $85 per month fixed fee for solar owners was reportedly justified by a cost of service study conducted by the co-op, but it is not clear the study was satisfactorily rigorous or that it showed clearly the solar-owning customers are being subsidized by other co-op members to the extent the proposed fee suggested.
• The co-op withdrew the proposal after the Environmental Law & Policy Center filed a petition with the utilities board asserting a fee on only customers with distributed generation would violate Iowa law. Because the proposal was withdrawn, a request to review the cost of service study by the Iowa Office of Consumer Advocate became irrelevant.

Dive Insight:

Electricity suppliers across the U.S. are increasingly imposing higher fixed charges on consumers with distributed generation to cover revenue losses incurred from diminished electricity sales. 

An increased emphasis on fixed charges may seem logical to utilities that are legally entitled to fair compensation for services they provide, James Tong and Former FERC Chair Jon Wellinghoff recently wrote in Utility Dive. Grid connected customers should pay for the services they get, but "the assertion that solar customers do not pay their fair share is based on a flawed assumption that cost shifters are necessarily freeloaders,” the authors argued.

Fights over net metering, fixed charges, and third party ownership (TPO) continue to make headlines in other states but the battle lines drawn earlier this year in Iowa may be disappearing. Alliant Energy, one of the state’s dominant electricity providers, recently withdrew its refusal to net meter solar installations financed in TPO arrangements.