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Indiana Senate panel OKs bill to reduce solar incentives

February 16, 2017

A state Senate committee has approved a bill that Indiana's investor-owned utilities back that would eliminate much of the financial incentive for installing solar panels.

The measure by Sen. Brandt Hershman was approved Thursday on an 8-2 vote.

Utilities say the current Indiana system of compensation is unfair because it requires them to pay solar panel owners for power at retail cost—which is more than it would cost the utilities to produce the same amount of energy. They also stress that they own the infrastructure the solar panel owners rely on to feed their excess power onto the grid and should be compensated for it.

Supporters say the current compensation method allows them to pay off their expensive investment in solar. The measure would drastically reduce that rate in five years.

The bill was amended to grandfather in current solar panel owners for 30 years after substantial opposition was voiced during a hearing last week.

Hershman, a Republican, said concern over compensation rates will likely be moot in the coming years as the cost and efficiency of the technology improves.

Solar power provides only about 1 percent of the country's energy, but the industry is growing, with figures showing it employed 208,859 workers in 2015. That amounts to a 125 percent increase since 2010, according to the U.S. Department of Energy. The Solar Foundation estimated about 1,500 of those jobs are in Indiana.

Critics say utilities are trying to muscle out smaller companies from the emerging solar energy market.

 

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