A bill establishing a legal framework for community solar projects passed the Montana Senate.
SB 188, Revising solar energy policy laws would allow a solar developer to build a solar array between 50 kW and 5 MW, and sell shares of the electricity generated to subscribers, which would be used as credits on their electricity bill.
The bill’s sponsor, Sen. Chris Pope, who unsuccessfully introduced similar legislation in 2023, said the bill would expand access to locally generated, emissions-free power, which would decrease participants’ utility bills, support a growing but underdeveloped industry and improve the grid’s resilience to extreme weather events.
The bill passed through the Senate with 38 votes. More than 20 people testified in favor of SB 188 and two representatives from Montana’s investor-owned utilities testified against the bill.
Scott Sweeney, a former general manager of Fergus Electric Coop testified on behalf of Northern Plains Resource Council. “Montana families and local businesses pay for the electricity that has increased substantially over the last few years. Perhaps even more troubling, these rate hikes don’t have an end in sight,” he said.
Sweeney pointed out that things people can do to lower their electric bills are sometimes hard to do.
“Not every house is suitable for rooftop solar,” he said. “There’s barriers that renters can have and it can be hard to do these upgrades. Senate Bill 188 enables a voluntary program that these Montanans could use to cut through all the barriers and access impactful and helpful savings.”
“Fortunately for us in here in Montana, we know that this type of program works because it’s common across the country with 24 states having similar programs,” Sweeney said.
Sweeney pointed out that nine electric cooperatives in Montana currently offer community solar subscription offers, which he said “see high demand for subscriptions and deliver benefits to their members.”
During his tenure at Fergus Electric, Sweeney said the coop had “a very good experience” with community solar. “It showed me that this opportunity can and should be made available to investor-owned utilities,” he said.
Sweeney described the setup as having been “very doable” for his staff and its management “seamless” and mostly automated for both the staff and members.
“This interest stemmed from the fact that these projects were performing the way they were intended to effectively in delivering cost savings to our members,” he said.
During his testimony, Sweeney noted that both Montana-Dakota Utilities Company and NorthWestern Energy recently raised their rates by 9% and 28%, respectively, and are currently working on another round of proposed rate increases. Community solar can offset these rates, he said.
“I’m a captive to NorthWestern Energy,” another Montana resident, Jack Hanson, testified. Born and raised in Montana, Hanson is a homeowner and a “reluctant customer of NorthWestern Energy,” he said. “I say reluctant because I have no choice about where to buy my electricity. There is no market for me to shop among suppliers.”
“Like many of my neighbors, I’m falling behind,” Hanson said, noting that his electric bill has increased 28% over the last two years, while in contrast, his income has only increased 4% over the same period.
“The bill extends some measure of choice to captive utility customers like me,” he said. “It promises to reduce my monthly electric bill, by allowing me to buy solar energy credits,” he said. “It costs us taxpayers nothing at all, and it will encourage our investor-owned monopolies utilities to be more responsive to its customers.”
Alan Olson, NorthWestern Energy’s director of government affairs, said the utility is not in “the least little bit” opposed to renewable energy. Olson said “community solar loads [NorthWestern Energy] down with doing all of the paperwork. That is a cost that’s passed on to other ratepayers.”
Olson said NorthWestern wants interest and demand to go through the qualifying facility process, referencing a Montana Public Service Commission-regulated process that allows smaller power generators to tie into transmission infrastructure owned by a monopoly utility.
Pope responded to these concerns, saying pains have been taking to ensure there are no cost shifts associated with the bill.
Blake Bjorson, a commercial solar developer for OnSite Energy, said that along with creating opportunities for people like himself that can’t otherwise participate in community solar, SB 188 will lower electricity.
“Folks investing in these [programs] are buying into the long-term energy savings,” he said. “Knowing these systems will last 30+ years, so they’re buying into that long term nature. They’re also hedging against future utility price hikes,” he added.
“Shared solar is more cost effective than individual rooftop systems because it benefits from economies of scale,” Bjorson said. “We can build larger systems and have them be less expensive on a per kilowatt basis than multiple small ones.”
Bjorson’s testimony said SB 188 is also important because it will help grid reliability. “I’m a huge fan of distributed energy,” he said. “It reduces stress on the grid, especially during peak demand periods like hot summer afternoons when air conditioners are running and solar panels are producing at their peak.”
“With ever increasing electricity demand, we need to welcome the development of new energy generation sources,” Bjorson said, “and shared solar should be part of that.”
