The neighboring states of Alabama and Mississippi are headed down very different roads when it comes rooftop solar panels.
Mississippi this week enacted a new set of rules to incentivize solar, including rebates for low- and middle-income customers and incentives for schools that choose to install rooftop solar.
Alabama’s Public Service Commission, meanwhile, is going to federal court to defend a fee charged to solar customers by the state’s largest utility, Alabama Power. That fee adds $27.05 every month to the bill of an Alabama Power customer with an average-sized (5 kilowatt) rooftop solar array, offsetting the savings from the solar panels.
Solar advocates say Alabama is being left behind by other Southern states in terms of rooftop solar installations.
“The Mississippi commission is making clear advances to encourage rooftop solar, because it benefits low, moderate income households, and it benefits customers generally and the grid generally,” said Keith Johnston, a senior attorney at the Southern Environmental Law Center, which is challenging the Alabama Power solar fee in federal court.
“Big picture, it’s just leaving Alabama in the dust,” Johnston said. “Mississippi’s implementing these provisions now. Georgia has already implemented provisions, and looking at more, to encourage rooftop solar distributed generation.
“In Florida, even Governor [Ron] DeSantis just vetoed a bill down there that would have authorized additional charges on rooftop solar. So, you know, all these states are trying to encourage and incentivize rooftop solar to help citizens of the state, and Alabama is not doing that.”
The Mississippi Public Service Commission announced the new rules this week, including the low-income subsidies, school programs, a form of net metering, in which solar customers are credited for the excess power they put back onto the grid at or near the same rate that they pay for taking it off the grid.
When Alabama Power solar customers feed energy back onto the grid, they are only credited for the amount it would have cost the utility to generate that same amount, significantly lower than the retail electricity rates.
“These new rules will make Mississippi open to business to clean energy technology developers, manufacturers, and installers, and will help boost low-income opportunities allowing Mississippians to experience the cost-saving benefits of solar energy,” Mississippi Public Service Commissioner Brent Bailey said in a news release announcing the new programs.
The Mississippi was a bi-partisan effort from the commissioners.
“Mississippians grow their own food and fix their own vehicles and deserve to have the chance to generate their own electricity and save themselves money,” Commissioner Brandon Presley said in the release. “This balanced, measured approach by the PSC opens the door of opportunity.”
Alabama’s solar fee, officially called the capacity reservation charge, was proposed in 2012 by Alabama Power and approved by the Alabama Public Service Commission.
The company says the fee is necessary to cover the costs of having electricity available to solar customers when their panels aren’t producing power.
“Customers with on-site generation who want backup service from the grid should pay the cost for that service,” Alabama Power spokesperson Alyson Tucker said during a previous challenge to the fee. “If not, other customers unfairly pay the costs for those individuals and businesses.”
The SELC and others formally challenged the fee with the PSC in 2018. The PSC sided with Alabama Power in 2020, saying that the company had “demonstrated that its back-up power service charges are reasonable.”
“In arriving at this conclusion, the staff determined that the Complainants/Intervenors did not provide any substantive evidence, calculations or alternative methods to persuade Commission Staff that Alabama Power’s back-up charges should be rejected,” the staff report included in the meeting agenda stated.
That decision prompted the groups to take their challenge to federal court. Johnston said the judge is considering pretrial motions in the lawsuit. He said no court dates have been set as of yet.
Alabama ranked 49th in the country in residential solar last year, with fewer rooftop installations than Alaska. Mississippi ranked 48th in that survey, but the new incentives may see the state climb in the rankings.
Daniel Tait, chief operating officer of Energy Alabama and a critic of the Alabama Power solar fee, said the rules put Alabama at a disadvantage for solar business development.
“Mississippi is eating Alabama’s lunch,” Tait said by email. “Mississippi’s new renewable energy compensation rules show they mean business about creating new jobs and saving folks money.
“By contrast, Alabama’s rules show big-government protectionism of Alabama Power to the clear detriment of regular folks. It’s not who we as Alabamians are.”
Read More: Mississippi opts to encourage solar panels, as Alabama fights to keep solar fee