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Minutes for SB124 - Committee on Utilities

Short Title

Prohibiting the state corporation commission from authorizing certain charges for electric service.

Minutes Content for Mon, Feb 25, 2019

Chairman Masterson opened  the hearing on SB124

Staff gave an explanation of the bill.(Attachment 1) 

PROPONENTS

Tom Hawk, Kansas State Senator is in support of this bill.  He stated that he wants to share his thinking about the best possible future for energy in this state and to hopefully encourage the Legislature to provide clarity and direction to the KCC, as has been our legislative practice over many years.(Attachment 2)

He pointed out two important issues.  First, a fairness issue for individual consumers who have only one choice in the marketplace to buy their electricity.  Secondly, this bill hopes to remove the disincentive for our constituents and renewable energy businesses to invest in solar panels and perhaps other technologies and continue what had begun in our state as a growing private energy business with renewables.

Senator Hawk stated that as part of his review of this recent change at the KCC, he looked back at the 2009 net metering bill, S.Sub for HB2369.  Section 11 laid out the net metering process.  In 2014 S. Sub for HB2101 changed the rate for any excess electricity generated by a customer to "the utility's monthly system average cost of energy per kilowatt hour."  Protections for the State's IOU Utilities were placed into both bills.

He concluded by saying that he believes that we need to not stand in the way of individual property rights and the wish of many Kansans who wish to invest in their homes and attempt to control their energy and electric usage and costs.

Dorothy Barnett, Clean Energy Business Council stated that despite our long history and partnership with the IOUS - this issue of distributed generation and rooftop solar for Kansas homes is the most contentious issue we've ever faced.(Attachment3)  She went on to explain how the demand charge is figured.  Westar's charge is figured from 2-7pm Monday through Friday.  It's based on your highest hour of energy use.  This kind of rate making may just be the beginning of utilities trying to save an antiquated business model that does not allow customers to manage their bills with old or new technology - what's next.

Paul Snider, Representing Kansas Industrial Consumers Group testified that at KICG we believe high energy costs are negatively impacting residential consumers, schools, hospitals, and large and small businesses.(Attachment 4)  They understand that Kansans are struggling with high electricity costs.  While many homeowners invest in solar for its environmental benefits, businesses choose to invest because of the energy cost savings potential. 

Zack Pistora, Kansas Sierra Club stated that current demand charges on customer-generators are unfair; the discriminatory charges comprise an unwarranted cost burden on a group of Kansans that are actually benefiting the electrical grid with their clean energy production.  This bill will help our energy policy comply with existing Kansas law (K.S.A. 66-117d) and align Kansas with other states that embrace solar and energy independence.(Attachment 5) 

Kent Rowe spoke on behalf of the Faculty Green Group at Wichita State University.(Attachment 6)  A seventeen-year study conducted by National Renewable Energy Laboratory, Berkeley Lab and US Dept. of Energy determined that Demand Charge Capacity Credit has, is in some cases, under-compensated solar customers to the electric system.  The recommendation by this investigation is instead to compensate solar customers who feed back into the electric system by establishing pre-defined Peak Periods such as 12-4pm.

Andrew Clark, Instructor for Cloud County Community College stated that he is fairly new to the solar industry, but he is profoundly vested in renewable energy in Kansas.(Attachment 7)  He then said that because of the Westar case, a few of the small cooperatives have joined in the practice of charging discriminatory fees for self-generation customers, which makes a case for solar a difficult sale.

Scott White, Cromwell Solar testified that Distributed Generation makes our grid and our state more resilient..  Allowing the utilities and their regulators to punish people who invest their own money into becoming more energy independent and resilient doesn't help the state as a whole.(Attachment 8)

Chris Miller, Tecumseh, Kansas testified that he has an all-electric home and lives on a fixed income.  He went on to explain how the additional demand fees has increased his electric bill even with all the effort he has put in to minimize his usage to 5 kW or less during demand measurement periods.(Attachment 9)

Dirk Hutchinson, Salina, KS stated that he put solar panels on his residence with the aim of decreasing his Westar Energy bill because he lives on a fixed income.  He further stated that he has been even more conscientious about using less electricity during peak demand times and has been successful during winter months.  The higher cost summer demand charges caused by circumstances beyond his control will cause a significant increase in his electric bill and will significantly lengthen the 20 year pay-back that he was expecting from his solar panel.(Attachment 10)

Andy Rondon, Good Energy Solutions, Inc.stated that the majority of his business is in the Westar and KCP&L territories.  Residential sales in Kansas remain stagnant as they have zero new residential customers in Kansas thus far in 2019.(Attachment 11)

Lindsey Constance, Metro KC Climate Action Coalition provided testimony stating the he is here to advocate for his constituents who are choosing to be bold, to take advantage of an opportunity given to us from above, and who are joining us as partners in protecting our environment.  If we are to take on the impending challenge of a changing climate, a multifaceted approach is needed.  Rooftop solar has the potential to be one of the most effective ways to reduce greenhouse gases.(Attachment 12)

Jeff C. Jones, Tru Building provided testimony saying that with the DOE requirements to meet certification we must build these "solar ready", which means conduit, disconnects, and systems in place to make the installation of solar less expensive in the future for the homeowner.  He stated when he learned of the new "penalty" being implemented on consumers with solar which not only charges them more per month, it also does not give the consumer the option to not be in the "peak load" program which is offered to others.(Attachment 13)

Michelle Milburn, Mission, Kansas stated that she is a solar owner producing 40% of her home's power usage.  She is also the face of a Kansas Clean Energy Job, an energy technical specialist for a wholesale electric supply company.  All businesses and homeowners suffer under escalating rates that outpace every neighboring state.  Solar benefits everyone.  Solar is not "unfair to other rate payers".(Attachment 14)

Barbara Mason, Lawrence, Kansas testified that when they invested in rooftop solar, they calculated it would take 13 years to achieve a break-even point, but they were willing to do that to reduce their bills and their carbon footprint.  If their bill increases from $3/kW to $9/kW in the summer, will it  take them 49 years to reach a break-even point?(Attachment 15)

Christina Amerin stated in her testimony that Westar is now penalizing me for providing my own energy.  I find it amusing that Westar is against solar energy when so few people are actually utilizing it.  I also find it funny that Westar would like to charge me more to use solar while they encourage their customers (on the bill they advertise for this) to use their solar energy.(Attachment 16)

Emily Parnell, SunSource Homes, said that because of the demand charge, SunSource stopped installing solar in the KCP&L and Westar territories.  She went on to say instead, we've expanded our business east, throughout Missouri with another office in southern Illinois, as well as opened an office in eastern Colorado. (Attachment 17)

Clyde Schwanke, Topeka, Kansas stated last year we spent $38,000 to install a solar system in our back yard.  Our purpose was to charge our two electric vehicles and further reduce our carbon footprint.  I view this as a $38,000 contribution to Westar's green generating capacity.  The only cost to Westar was a meter.(Attachment 18)

Matt Graham, EZpers stated as a solar customer my lowest demand period is the EXACT time they need to reduce demand the most.  Sunny, hot summer days.  On these days I actually generate more power than I use.  Thereby not only reducing peak demand but even contributing more to help lower overall demand.(Attachment 19)

Rachel Krause, Lawrence, Kansas testified that she has solar panels and since October have been subject to punitive demand charges that have already raised her rates considerably and are likely to be MUCH worse in the summer.  She went on to tell why she had solar panels installed.(Attachment 20)

Brent Ragsdale, Tonganoxie, Kansas stated that he and his wife built a custom home.  They elected to go all-electric with our HVAC system even though it's typical in their area to use propane for heat.  This makes Westar their only energy utility provider.  He then stated that their intent all along has been to add photo-voltaic solar panels to the roof their house.(Attachment 21)

Robert Rosenberg, Manhattan, Kansas stated that there is a glaring injustice in the KC approved 3-part rate plan.  The new 3-part rate plan provides a discount on the electricity that you buy from Westar.  This discount is the basis for Westar's claim that demand fees will not severely discourage rooftop solar.(Attachment 22)

Question and answers followed.

WRITTEN ONLY TESTIMONY

Chairman Masterson is holding the hearing open until after turn around to hear from the Opponents on SB124.

Next meeting March 6, 2019 On Call of the Chair

Meeting adjourned 2:30pm