By Richard Rafes guest columnist
American Electric Power Company, a large electric company listed on the NASDAQ, provides power to numerous states in America, including parts of West Virginia.
Currently, AEP is requesting a rate hike and a reduction in net metering reimbursement from 100% to 30%. Net metering provides homeowners and businesses with credits for the excess solar energy they produce that is returned to the power company for their use. It reduces their total energy costs. For many years, this was a one-to-one credit. However, now AEP wishes to grossly reduce the credit down to 30%. Beyond the obvious inequity in this proposal, there are several reasons why AEP should not be granted a rate hike or a modification of the net metering ratio.
Before I address the rate hikes and net metering reduction, allow me to provide the reader with a little personal background. My wife and I moved to West Virginia several years ago and established a small fruits and vegetables farm as a business after we retired from the education sector. Our farm utilizes a lot of energy, and we decided early on to have solar panels installed. We put 70 panels on our barn as it had excellent southern orientation for capturing the sun. While we were producing significant energy, our business and electrical needs grew. We decided more recently to add 84 more solar panels. We hope this will cover our electrical costs. Factored into the coverage was the 100% net metering. Had we not had that credit to offset our electric costs, going solar would not have been economically feasible. We have seen our electric power rates continue to rise over the many years. We needed solar to offset these costs.
So why should AEP not be granted rate hikes and net metering reductions at this time? The reasons are many. First, their company appears to be thriving. In the last year, the AEP stock rose over 29%. So while Americans continue to suffer from high prices and inflation, AEP is apparently receiving a windfall of profits. Related to this is that Americans were promised by our new President that costs would be going down. To approve this rate hike and decrease net metering runs counter to that promise and slowing inflation. In fact, it will cause more inflation for every West Virginian and business utilizing AEP.
Second, the solar energy industry in West Virginia has been expanding dramatically in the last few years. Solar Holler, the company we contracted with for our solar installations, provides good-paying jobs to many West Virginians who came from the coal field areas of the state. There is no doubt that the reduction of the net metering will severely hurt this clean energy industry. Frankly, it appears that the net metering reduction is aimed at decimating the solar energy industry in our state.
Third, solar energy helps all West Virginians as it reduces the burdens on the grid, particularly during high electrical demand. During the hot summer days, when energy use is peaking, solar panels are returning the needed energy to the grid. This diversified energy source helps keep our state electrical grid strong. We need to encourage more solar production rather than hinder it.
For the reasons stated above, I hope these energy rate hikes and net metering reductions will be denied, as there is no justification that can outweigh the harm these measures will inflict on West Virginians and their businesses.
Richard Rafes, Ph.D., J.D., is a solar homeowner who lives in Caldwell, W.Va. He is a member of the Registry of College and University Presidents.