Two weeks after Dave Hommrich, president of Sunrise Energy, publicly marveled at how well he’s been treated by West Penn Power — contrasting the relationship with his legal battle with another Pennsylvania utility — West Penn sent him what amounted to a Dear John letter.
Mr. Hommrich is a solar developer. His first and only completed project in the Washington County community of Slovan started producing power in 2010. That power, or 99.9 percent of it, was sold back to West Penn Power under a net-metering agreement, something that Pennsylvania law allows for customer-generators who install small alternative generation systems.
Net metering lets customers use the electricity produced by their installations to offset their own demand and then sell back to the utility any excess.
The question of whether customer-generators can install solar panels or a methane digester in a spot that doesn’t have a pre-existing load is currently under debate by the Pennsylvania Public Utility Commission.
Sunrise’s whole existence is due to the net metering provision of Pennsylvania’s Alternative Energy Portfolio Standards Act of 2004. West Penn Power is the Slovan’s solar farm’s only source of revenue. The facility generated more than 1 million kilowatt hours during the year ended May 31, enough to power about 92 average American homes.
On May 22, FirstEnergy Corp, West Penn’s Akron-based corporate parent, informed Mr. Hommrich that after an internal audit, the company has concluded that Sunrise doesn’t and never did qualify for net metering because it has no “retail load” at the site. In other words, it’s not offsetting an existing demand independent of the installation but is instead powering a few pieces of equipment needed to run the solar farm and selling the rest of the energy back to the utility.
Sunrise isn’t arguing that point. Rather, the Green Tree-based company is saying there’s nothing in Pennsylvania’s laws or code that prohibits that arrangement. Interpreting it otherwise is going against legislative intent, the company argues in a lawsuit it filed last week against FirstEnegy.
It’s the same argument Sunrise made when it sued PPL Electric Utilities Corp. in May for not allowing it to net meter three proposed projects in eastern Pennsylvania. That case is still open. And it’s the same logic that underlies Sunrise’s numerous letters to the state Public Utility Commission, which has proposed new regulations that would restrict who can net meter and, if enacted, would cut players like Sunrise out of the game.
“Without legal protection, renewable energy could never flourish in Pennsylvania,” Sunrise’s complaint against West Penn states.
FirstEnergy declined to answer questions pertaining to its interpretation of net metering, internal audits of net-metered customers and how many others may have received similar letters, saying all that information is relevant to the lawsuit. It’s the company’s policy not to comment on litigation.
Sunrise says West Penn knew about and fully approved the net-metered solar farm in Slovan from the beginning. The utility charged Sunrise nearly $60,000 to upgrade infrastructure to connect the solar panels to its distribution system. It signed net metering agreements with Sunrise, and, most tellingly, it provided Sunrise a monthly account of how much energy was being produced and consumed by the facility, which informed how much West Penn paid Sunrise at the end of each electric year on May 31.
“Now, several years after the facility was approved and commissioned, West Penn is reneging on its commitment to Sunrise,” the company’s complaint states.
According to the lawsuit, the utility paid Sunrise for its excess production each year ending May 31, but has refused to pay for the year that ended May 31, 2014.
“West Penn’s current behavior harkens back to the state of the Pennsylvania renewable energy industry in the years leading to the act being signed into law,” the suit says. “Prior to that time, electric utilities had a reputation of thwarting renewable energy projects.”
Now, the solar company stands to lose $2 million in profits if West Penn’s decision stands, Sunrise warned in its complaint.
Sunrise filed the lawsuit in Washington County Court of Common Pleas last week. FirstEnergy has not yet responded.
Anya Litvak: email@example.com or 412-263-1455.