Net metering for solar makes electrical power generation more democratic

Editor’s note: The Reformer is publishing dual commentaries as Minnesota lawmakers consider changes to the state’s net metering law. Read the competing commentary here. 

Our state net metering policy is what allows Minnesotans to install solar and be power producers, not just power consumers. Net metering requires that solar owners be fairly credited by the electric utility when the owner delivers solar power to the grid.

But the first goal of a monopoly is to maintain their monopoly. This is why monopoly power utilities are constantly trying to weaken net metering. They want to be the only option when it comes to delivering power.  

The concept of net metering is fair and simple. Power produced by a small solar array — defined in state law as an array under 40 kW — is first consumed by the homeowner, small business or farmer who installed it. If there is any power they can’t use, it goes to the grid, flowing to nearby power users. The utility charges the user for that power even though the utility did not produce it. The utility then credits the solar owner who produced the power that same amount. For the utility, this is an economic wash — the credit is equal to the income the utility generates for charging for the solar owner’s power. 

Net metering is key to advancing small-scale solar, which benefits us all.

First, it quickly adds renewable solar power to our energy mix. With the demand for electrical energy surging as more of our cars and appliances become electric, we need all the renewable energy we can get as soon as we can get it. Rooftop solar goes up in weeks, as opposed to utility scale solar — which takes years. Second, producing power closest to where it is used is most efficient. There is almost no line loss with rooftop solar, and it reduces the need for large transmission lines. Third, it allows Minnesotans to take control of their energy costs and become energy producers, not just consumers. 

Representatives of Minnesota’s rural electric cooperatives and municipal power companies are proposing state legislation to gut net metering. They propose that when a solar owner shares electricity with the neighbor, a rural electric cooperative or municipal utility can still charge the neighbor full retail price, but for any credits the solar customer has at the end of the year, they will compensate them a small fraction of that. And rural electric cooperatives and municipal utilities already can and do charge solar access fees just for having solar. They want to keep charging solar owners a fee for having solar and pay them a dramatically reduced rate for solar they deliver to the grid.

I can see why they would want this change. I can’t see how they can claim it is fair.

Opponents of net metering like to bring up California, but that comparison actually makes the case for Minnesota keeping our current policy.

California had such a successful net metering policy that they reached 2 million rooftop solar arrays (versus fewer than 25,000 in Minnesota) which by one analysis has saved utility customers as much as $1.5 billion in 2024 alone. But utilities succeeded in dramatically weakening California’s net metering law by pushing a cost shift myth. As a result, the adoption of solar slowed and thousands of solar jobs were lost. (For a deep dive on this issue go to the Solar Rights Alliance website.) That isn’t what we want here in Minnesota. 

Solar United Neighbors is a non-profit that works with folks throughout the state to help them go solar. The majority of people we work with are middle or lower income and small businesses looking to control energy costs and be a part of a carbon-free energy future. This is also what the Lawrence Berkeley National Laboratory reports from their 2024 report on the income of solar adopters: “Roughly 49% of solar adopters in 2023 had incomes below 120% of their area median income, a threshold sometimes used to define ‘low-and-moderate income,’ while 26% were below 80% of AMI, often used to define ‘low-income.’” It’s a myth that solar adopters are only wealthy. In fact, solar is a key way that middle and lower income folks can take control of their energy costs.  

Solar is still emerging and growing in Minnesota, especially in rural areas. The overwhelming majority of utilities in Minnesota have solar penetration that is less than 1% of customers with fewer than 500 small solar arrays in their service area. Changing our net metering policy now would reduce solar adoption dramatically just when it is most needed.

Decentralizing and democratizing our energy production may threaten monopoly utilities, but it is clearly in the public interest and we should be proud that Minnesota has a simple and fair net metering policy that is making this possible.