Dive Brief:

• "The Minimum Bill as a Net Metering Solution," a new report from GTM Research, concludes that a minimum bill set by state regulators would be preferable to a fixed charge for solar customers.
• Massachusetts House Bill 4185, compromise legislation from a breakthrough agreement between renewables advocates, utilities, and regulators, includes a minimum bill, a new approach to infrastructure costs that stakeholders hope will grow solar without the controversy associated with a fixed bill charge.

Dive Insight:

HB 4185 must be passed by Massachusetts legislators before the minimum bill and other changes to the state’s solar policy are implemented, including (1) elimination of the net metering cap, (2) a reduced virtual net metering reimbursement rate, (3) replacement of the SREC rebate program with performance-based incentives, and (4) making the 1,600-megawatt installed solar capacity target legally binding.

If a distributed energy owner’s monthly net energy use is positive, the bill is the total kilowatt-hours at the retail electricity rate. If net energy use is negative, the bill is for zero kilowatt-hours and the minimum bill applies. Excess net metering credits carry over and as long as the net metering credits -- either those carried over or those for the current month -- reduce the bill to zero kilowatt-hours, the minimum bill applies.

With a hypothetical $10 minimum bill, an NStar customer with a 6.3-kilowatt rooftop solar system, a $0.1733 per kilowatt-hour retail electricity rate, and a $7 per month fixed distribution charge, would pay $434.77 per year while the same customer, with a $10 monthly fixed charge, would pay $458.77 per year. The extra $24 comes from the $3 -- the solar customers' $10 fixed charge minus all customers' $7 monthly fixed distribution charge -- for the eight months when reduced solar production eliminates the minimum bill.