LIBA asks LES to Postpone Action on Revised Renewable Energy Rates

The Lincoln Independent Business Association feels compelled to convey its position on the revised renewable net metering rider and new renewable generation rate.  After careful consideration LIBA chose to take a neutral position because we could neither support nor oppose the proposal.

LIBA chose not to oppose the proposal in recognition of the commitment shown by LES and this Board to minimizing the fiscal impact of expanding renewable energy Lincoln.  LIBA is aware that LES heard many proposals for expanding solar and instead of adopting a prepackaged idea chose to create its own program. LES created this unique program in an attempt to balance the interests of all ratepayers by creating an incentive for renewable energy while simultaneously minimizing the ongoing costs of the program and capping its total cost.

That said, LIBA could not support this program both because it is more appropriately addressed in conjunction with the LES budget and because it does not maximize energy value for LES customers.

This proposal represents a new and ongoing cost to LES and LES ratepayers and therefore it is more appropriately addressed in conjunction with the LES budget.  The excess generation energy rate proposed has the potential to cost $45,000 per year under Tier I and $67,500 per year if Tier II is reached. Though this is a small drop in the bucket compared to the overall LES budget, it is still an expense. As an expense, this proposal would be best viewed in conjunction with LES’ overall budget.

LES’ stated mission is to maximize energy value in an environmentally responsible manner.  Though this proposal may meet the latter criteria, it falls short of the former. LES’ cost to purchase renewable energy is around 2.5¢/kWh[i] under this proposal LES will purchase customer generated renewable energy at 9.9¢/kWh[ii], almost four times more. Simply stated, LES can purchase renewable energy at a lower cost than it will pay under this program.

Finally, LIBA would ask three things of this board.  First, to postpone action on the revised renewable net metering rider and new renewable generation rate until it can be taken up in conjunction with budget discussions, next to ensure an annual review of the program to assess its cost to the system, and finally LIBA encourages this Board to strive to reverse the current trend of yearly rate increases.



[i] “Renewable Rate Revisions;” Powerpoint presented by Jason Fortick; March 5, 2014; slide 6

[ii] “Renewable Rate Revisions;” Powerpoint presented by Jason Fortick; March 5, 2014; slide 13

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