Solar has been expanding exponentially over the past 5 years. Yet, despite being the “sunshine state”, Florida only ranks 14th in the cumulative capacity of solar installed. Amendment 1, titled “Rights of Electricity Consumers Regarding Solar Energy Choice” on the Florida ballot next week is intended to make a difference. But will it? Below is a brief overview of the ballot measure and the potential implications if it is passed.
According to the ballot summary, Amendment 1 would:
- Provide the constitutional protection for consumers to own or lease solar equipment installed on their property to generate electricity for their own use
- Allow state and local governments to continue protecting consumer rights and public health, safety and welfare, and to ensure those who do not install solar are not required to subsidize those who do have solar.
What does all of this mean? The first part provides a constitutional protection for anyone in Florida to install solar panels to generate electricity for their own use. However, this is already largely granted via the Florida Statute 163.04, which states that a property owner cannot be prohibited from installing solar systems on their roof. Thus, the existing statute protects a homeowner’s right to install rooftop solar, potentially negating a need for this provision in Amendment 1.
A key portion of this part of the amendment is “for their own use” – which also ties into the second part of the amendment. On a sunny day, a residential customer will likely have a solar PV system that generates more electricity than they consume, resulting in some energy going to the grid. Therefore, with this terminology, Amendment 1 may direct that there are no rights or guarantees that a customer will receive benefits for this excess generation. This may establish conflict with existing rules adopted by the Florida Public Service Commission (PSC) that allow residential customers of investor-owned utilities (e.g. Florida Power & Light, Duke Energy Florida, Gulf Power, Tampa Electric) with solar photovoltaics (PV) to participate in “net metering” and receive full retail credit for excess generation. Given the current net metering rules established by the PSC, it appears that Amendment 1 would offer no additional protection or support to customers with solar and may instead provide grounds for modifying or eliminating net metering rules. If net metering policies were no longer in effect in Florida, it would be unlikely for customers with solar PV to even come close to breaking even on their investment.
The second part of the amendment allows:
- State and local governments to continue protecting consumer rights and public health, safety and welfare, and to ensure those who do not install solar are not required to subsidize those who do have solar.
The biggest point of contention here is the issue of whether solar PV customers are being subsidized by those without solar PV. Answering this question is complicated because it is hard to quantify the actual value of solar PV to the utility and to the public. We will present a breakdown of some of the benefits and costs of solar PV in a forthcoming article.
Outside of the perspective of electricity costs, state and local governments in Florida may seek to revisit current property tax laws. Amendment 4 to the State Constitution, “Florida Property Tax Exemptions for Renewable Energy Equipment”, was approved in August 2016 and prohibits consideration of the value of any solar/renewable energy source devices from being included in property tax assessments. If this remains intact, installing solar PV would not raise one’s property taxes. With Amendment 1, some may try to argue that this tax exemption is a subsidy and thus establishes conflict with Amendment 4.
Overall, Amendment 1 appears to be in conflict with current Florida statutes and policies, with potentially large implications if current statutes and policies are changed. Given the existing statues and policies that already give customers the right to install solar, participate in net metering, and exclude solar from property tax evaluations, Amendment 1 does not specify any additional benefit or protection for current and future homeowners with solar. As a result, Amendment 1 is unlikely to promote the adoption of solar in Florida.