Nevada is Mass. solar's worst nightmare
It's all too easy to turn a deaf ear to the skeptics who cry “The world is ending! Massive job losses will happen if this bill is passed!”, a diatribe that we hear now and then at the Massachusetts State House. But out in Nevada, the solar industry's nightmare scenario is turning out to be very real.
Policymakers there have been having the same basic argument we are in Massachusetts: How much should solar array owners contribute toward the centralized power grid infrastructure, since renewable subsidies are primarily borne by utilities and their ratepayers? Very recently ,Nevada decided to change the deal with its solar incentives. In a radical shift, owners now will receive less than one-fifth the price they previously received for selling electricity back to the grid while paying triple in monthly fees to utility to connect their solar systems. The new legislation is retroactive, meaning customers who already had installed a solar array on their roof will get the new, much lower return.
This means investments that were made when the projected ROI was a just few years are now looking at decades before they earn any return. Ouch! Now major solar installers are shuttering their operations and laying off thousands of people; new solar projects have ground to a halt; and solar customers are left in the lurch for what they thought was a wise and eco-beneficial investment.
How will the current stalemate play out in Massachusetts? We don't know, but Nevada stands as a cautionary tale of how a legislative decision can cause an industry to collapse and consumers and investors feel betrayed. We believe cooler heads will prevail in the Bay State, and that Massachusetts' position as a leader in the installation of renewables is seen as an asset to sustain, not a misguided program to be thrown out with the bathwater.
A thoughtful, gradual scaling back of the generous incentives currently in place for the renewable industry is a prudent path, but a plan that decelerates those incentives too quickly has many risks, almost all of them negative. It is important the legislature and the governor move thoughtfully, but also with alacrity toward a solution that all sides can live with.
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