Morning Fizz

Seattle City Light Cuts Back Solar Power Incentive

Solar program is a victim of its own success, Airbnb hosts may be victims of over regulation, and neighborhood district councils say they're victims of Murray attack.

By Josh Feit and Spencer Ricks July 20, 2016

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 1. Seattle City Light is ratcheting back the incentives for people who use solar panels—and people like former Seattle mayor Greg Nickels are not happy about it.

People who put solar panels on their homes will now be receiving up to 35 percent less incentive money than the amount they were originally promised by Seattle City Light.

Historically, Seattle City Light used money from a state program known as the Renewable Energy System Cost Recovery Program that was created by the legislature to promote sustainable and green energy use. As part of that program, Seattle City Light told solar panel customers the would get $0.54 for every kilowatt-hour that their (Washington-made) solar panels generated energy. The rebates would be paid in five annual installments. Additionally, in an equation known as net metering, if the solar panels were generating more power than someone's home was using in the first place, Seattle City Light would give solar users a credit on top of the rebates for all the power they put back into the city's power grid.

But Seattle City Light topped out on the sate program budget during the 2016 fiscal year, forcing them to scale back the program. 

Nickels, who installed an 8.96-kilowatt solar panel system at his home last September, took to Facebook June 30 to voice his frustration over the change. The post garnered heated reactions from both sides, including from Mayor Ed Murray, who defended the city’s decision.

“Today is the end of the ‘Solar Year’ in Washington State,” Nickels wrote on his Facebook page. “This feels to me like a broken promise and will be a huge disincentive for others to install solar. And that’s a shame.”

Seattle City Light spokesman Scott Thomsen told Fizz Seattle City Light is not to blame for the drop in incentive money. Thomsen said the reason Seattle City Light reached the cap set by the legislature so quickly was because they more people were installing solar panels than anticipated, people were installing larger solar systems, and there were more days of sunshine in Seattle last year. Essentially, the program was a victim of its own success.

In a similar irony, Seattle City Light’s cap was also reduced due to lower electricity bills in general, which Thomsen attributed to lower heating bills for homeowners in recent milder winters and the increased number of energy efficient homes in the city in general.

Thomsen said Seattle City Light had two options when they reached their cap: end incentive programs for all future solar panel users, or cut the incentives for everybody. Mayor Murray chose the latter option for Seattle.

“Presumably, the incentives will keep going down until the legislature comes up with a fix for it,” Thomsen said.

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Nickels said one way the city could make customers feel better about the incentive cuts, was to have the incentive payments extended from five years to seven or eight years.

 “If you make a promise that you’re going to pay $0.54 an hour, and someone makes an investment—in our case the investment was over $30,000 to install the system—I think you have an obligation to make them whole,” Nickels told Fizz. “[Seattle City Light] has taken advantage of the system to encourage people to make that investment.”

SCL's Thomsen said they "made no promises about incentives." He added: "We described the incentives that were available from the state. The limitations on those incentives are set by the legislature as would any changes. All utilities in the state must follow those rules. If anyone believes changes are needed, they should contact their legislators."

2. Here's a follow-up to yesterday's Jolt about Seattle city council member Tim Burgess's new idea to phase out the option for Airbnb hosts to rent out rooms any place other than at their primary residence. (Burgess and Mayor Murray believe off-site short-term rentals are taking homes out of the long-term rental market, putting pressure on the affordable housing.)

 The Seattle Short-Term Rental Alliance, a group of small business owners, property managers and homeowners, who use short-term rental platforms like Airbnb, flagged the city's own Housing Affordablity and Livability Agenda (HALA) recommendations, to suggest an alternative proposal: tax short-term rentals like Airbnb to pay for affordable housing. 

The group rushed out a statement in advance of this morning’s housing committee hearing saying, “proposed regulations phasing out short-term rentals in secondary residences will result in unexpected consequences—negatively impacting the local economy, eliminating jobs, putting small business owners out of business, and harming the ability of private citizens to earn a living from income property.”

And they added: “SSTRA supports affordable housing in Seattle and wants to fund affordable housing initiatives as a civic revenue source recommended in section R.9 of the HALA report.”

Indeed, Fizz flagged the same policy when the council's discussion about regulating Airbnb began last month.

The HALA report is silent about converting Airbnbs to long-term rentals as a strategy, but rather, it explicitly recommends taxing Airbnb.  

The city should, in conjunction with the county and state governments, explore regulating and collecting hotel taxes from short-term rentals such as Airbnb or VRBO. Under such an approach, short-term rentals would collect and remit taxes to the county that originate directly from guests as an extra charge on their bill, the same way that hotels collect them…The city should commit to dedicating these taxes to affordable housing.

3. As Fizz reported Monday, a backlash may be brewing against Mayor Murray's proposal to stop relying on neighborhood district councils for community input; a city survey found that the 13 councils—established in 1987 as part of the neighborhood planning process—are older and whiter than the city at large, and made up largely of homeowners rather than renters like the majority of the city. 

West Seattle's Deldridge neighborhoods district council is holding a meeting tonight at the Highland Park Improvement Club at 1116 SW Holden. The invite calls the mayor's executive order an "attack on the district councils" and describes the reason for the meeting this way: "Because going quietly into dark nights was not why we got in this business." 

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