Florida 2022 2022 Regular Session

Florida Senate Bill S1024 Analysis / Analysis

Filed 02/10/2022

                    The Florida Senate 
BILL ANALYSIS AND FISCAL IMPACT STATEMENT 
(This document is based on the provisions contained in the legislation as of the latest date listed below.) 
Prepared By: The Professional Staff of the Committee on Community Affairs  
 
BILL: CS/CS/SB 1024 
INTRODUCER:  Community Affairs Committee, Regulated Industries Committee and Senator Bradley 
SUBJECT:  Renewable Energy Generation 
DATE: February 10, 2022 
 
 ANALYST STAFF DIRECTOR  REFERENCE  	ACTION 
1. Sharon Imhof RI Fav/CS 
2. Hackett Ryon CA Fav/CS 
3.     RC  
 
Please see Section IX. for Additional Information: 
COMMITTEE SUBSTITUTE - Substantial Changes 
 
I. Summary: 
CS/CS/SB 1024 amends s. 163.04, F.S., relating to energy devices based on renewable resources, 
to allow governing entities with a deed restriction, covenant, declaration, or similar binding 
agreement affecting the alteration of residential dwellings or condominiums to prohibit the 
installation of solar collectors in locations outside of specifically designated parameters. 
 
The bill also amends s. 366.91, F.S., relating to renewable energy, requiring the Public Service 
Commission (PSC) to revise its rules on net metering of customer renewable generation. 
 
Under the bill, the PSC must propose a revised net metering rule by January 1, 2023, meeting the 
following criteria: 
 Rate structures and billing must ensure that customers owning or leasing renewable 
generation systems pay the full cost of electric service and are not subsidized by the general 
body of ratepayers; 
 All energy delivered by the public utility must be purchased at the applicable retail rate; 
 All energy delivered by a customer generation system to the public utility must be credited to 
the customer at: 
o 75 percent of the public utility’s retail rate during the 2024 and 2025 calendar years. 
o 50 percent of the public utility’s retail rate during the 2026 and 2027 calendar years. 
o The public utility’s full avoided cost during the 2028 calendar year. 
 Net metering billing may include fixed charges, base facilities charges, electric grid access 
fees, or monthly minimum bills, to ensure that the public utility recovers the fixed costs of 
REVISED:   BILL: CS/CS/SB 1024   	Page 2 
 
serving those customers and that the general body of ratepayers does not subsidize customer 
renewable generation systems. 
 
The bill allows customers who own or lease renewable generation systems before 
January 1, 2023, to continue under the existing net metering rate design and rates for twenty 
years. This provision also applies to customers who purchase or lease real property with 
renewable generation systems installed for all or part of the twenty-year period. 
 
Under the bill, the PSC must require a public utility requesting a change in base rates to report 
the net metering impact on the public utility’s revenue and cost of service. 
 
The bill is effective July 1, 2022. 
II. Present Situation: 
Florida Public Service Commission 
The Florida Public Service Commission (PSC) is an arm of the legislative branch of 
government.
1
 The role of the PSC is to ensure that Florida’s consumers receive utility services, 
including electric, natural gas, telephone, water, and wastewater, in a safe, reasonable, and 
reliable manner.
2
 In order to do so, the PSC exercises authority over public utilities in one or 
more of the following areas: (1) Rate or economic regulation; (2) Market competition oversight; 
and/or (3) Monitoring of safety, reliability, and service issues.
3
 
 
Public Utilities 
A public utility includes any person or legal entity supplying electricity or gas, including natural, 
manufactured, or similar gaseous substance, to or for the public within the state.
4
 The term does 
not include municipal electric utilities and rural electric cooperatives.
5
 Therefore, the PSC does 
not regulate the rates of publicly owned municipal or cooperative electric utilities.
6
 
 
There are five investor-owned electric utility companies (IOU) in Florida: Florida Power & Light 
Company (FPL), Duke Energy Florida (Duke), Tampa Electric Company (TECO), Gulf Power 
Company (Gulf), and Florida Public Utilities Corporation.
7
 IOU rates and revenues are regulated 
by the PSC.
8
 These utilities must file periodic earnings reports, which allow the PSC to monitor 
earnings levels on an ongoing basis and adjust customer rates quickly if a company appears to be 
overearning.
9
 
                                                
1
 Section 350.001, F.S. 
2
 See Florida Public Service Commission, The PSC’s Role, http://www.psc.state.fl.us (last visited Jan. 9, 2022). 
3
 Id.  
4
 Section 366.02(1), F.S. 
5
 Id. 
6
 See PSC, Florida PSC 2020 Annual Report, p. 13, available at 
http://www.psc.state.fl.us/Files/PDF/Publications/Reports/General/Annualreports/2020.pdf (last visited Jan.9, 2022). 
7
 Id. FPL acquired Gulf in 2019 and merged as of January 3, 2022. 
8
 Florida Department of Agriculture and Consumer Services, Electric Utilities, https://www.fdacs.gov/Energy/Florida-
Energy-Clearinghouse/Electric-Utilities (last visited Jan. 10, 2022). 
9
 PSC, 2020 Annual Report, supra at n. 6, p. 6.  BILL: CS/CS/SB 1024   	Page 3 
 
 
Section 366.041(2), F.S., requires public utilities to provide adequate service to customers. To 
fulfill that obligation, public utilities monitor customer usage patterns in order to plan for future 
energy needs. Utilities use billing data to predict and make investments in their infrastructure.
10
 
Section 366.06, F.S., requires the PSC to allow the IOUs to recover honestly and prudently 
invested costs of providing service, including investments in infrastructure and operating 
expenses used to provide electric service.
11
 
 
Renewable Energy 
Section 377.803, F.S., defines “renewable energy” to mean “electrical, mechanical, or thermal 
energy produced from a method that uses one or more of the following fuels or energy sources: 
hydrogen, biomass, as defined in s. 366.91, F.S., solar energy, geothermal energy, wind energy, 
ocean energy, waste heat, or hydroelectric power.” 
 
Section 366.91, F.S.,
12
 requires utilities whose annual sales are greater than 2,000 gigawatt 
hours, to continuously offer a purchase contract to renewable energy producers, containing 
payment provisions for energy and capacity,
13
 based on the utility’s full avoided costs,
14
 for a 
minimum of ten years.
15
 
 
Public Utility Regulatory Policies Act (PURPA) 
In 1978, the federal government enacted the Public Utility Regulatory Policies Act (PURPA),
16
 
which required promotion of energy efficiency and use of renewables. The act required utilities 
to purchase power from “qualifying facilities,”
 17
 which fall into two categories: qualifying small 
power production facilities and qualifying cogeneration facilities.
18
 The PURPA directed the 
Federal Energy Regulatory Commission to implement the provisions, which in turn, directed the 
states to implement the provisions. In response, the Florida Legislature created s. 366.051, F.S.,
19
 
directing the utilities to purchase power from the cogenerators or small power producers. 
 
Full Avoided Costs 
A utility’s full avoided cost is the incremental costs of electric energy or capacity, which, but for 
the purchase from cogenerators or small power producers, the utility would have to generate 
itself or purchase from another source.
20
 Traditionally, the PSC has approved electric utilities 
power purchase contracts that include provisions for payment, capacity, and energy based upon 
                                                
10
 PSC, Bill Analysis for SB 1024 (Dec. 20, 2021) p. 2 (on file with the Senate Committee on Regulated Industries). 
11
 Id. 
12
 Originally enacted by Chapter 2005-259, s. 1, Laws of Fla. 
13
 Capacity is the maximum electric output, in megawatts, that an electricity generator can produce under ideal conditions. 
See U.S. Energy Information Administration, What is the difference between electricity generation capacity and electricity 
generation? https://www.eia.gov/tools/faqs/faq.php?id=101&t=3 (last visited Jan. 9, 2022). 
14
 See “Full avoided Costs,” on p. 3. 
15
 Section 366.91, F.S. 
16
 16 U.S.C. s. 2601 et seq. 
17
 Federal Energy Regulatory Commission, PURPA Qualifying Facilities, https://www.ferc.gov/qf (last visited Jan. 9, 2022). 
18
 Id. 
19
 Chapter 89-292, s. 4, Laws of Fla. 
20
 Section 366.051, F.S.  BILL: CS/CS/SB 1024   	Page 4 
 
either the utility’s cost to construct and operate its next planned generating unit or the cost of 
purchasing capacity and energy from generating units owned by other utilities in the interchange 
market.
21
 
 
The utility’s full avoided costs and the utility’s as-available tariff rate are not the same. Full 
avoided costs can include capacity and energy avoided costs, while the as-available rate only 
includes avoided energy costs, which is largely fuel.
22
 
 
Customer-Owned Renewable Energy Generation Systems 
Customer-owned renewable energy generation systems, primarily solar systems in Florida,
23
 
allow customers to generate their own electricity.
24
 It is defined as an electric generating system 
located on a customer’s premises that is primarily intended to offset part or all of the customer’s 
electricity requirements with renewable energy.
25
 
 
Interconnection
26
 with the electric grid allows customers to reliably power their homes even 
when the sun is not shining.
27
 When a customer-owned system generates more electricity than 
needed, the electricity flows onto the electric grid for distribution to another customer and the 
generating customer receives a credit toward future usage from the utility.
28
 Utilities are 
federally required to purchase excess power from small renewable energy generators.
29
 
 
Utility customers primarily benefit from interconnected renewable generation systems through 
personal use and reducing the amount of electricity they purchase from the utility.
30
 In turn, this 
effectively lowers the demand for electricity that the utility must meet for these customers.
31
 
 
Net Metering 
Net metering is a metering and billing methodology whereby customer-owned renewable 
generation is allowed to offset the customer’s electricity consumption on site.
32
 Under net 
                                                
21
 Florida Public Service Commission, States’ Electric Restructuring Activities Update: Wholesale Sales 
http://www.psc.state.fl.us/Publications/ElectricRestructuringDetails#4 (last visited Jan. 9, 2022). 
22
 PSC, SB 1024 Analysis, supra at n. 10, p. 2. 
23
 PSC, Interconnection and Net Metering of Customer-Owned Renewable Generation 2020, available at 
http://www.floridapsc.com/Files/PDF/Utilities/Electricgas/CustomerRenewable/2020/2020%20Net%20Metering%20Summa
ry%20Spreadsheet/2020%20Net%20Metering%20Report.pdf#search=Interconnection%20and%20Net%20Metering%20of%
20Customer-Owned%20Renewable%20Generation (last visited Jan. 9, 2022). 
24
 U.S. Department of Energy, Grid-Connected Renewable Energy Systems, https://www.energy.gov/energysaver/grid-
connected-renewable-energy-systems (last visited Jan. 9, 2022). 
25
 Section 366.91, F.S. 
26
 “Interconnection is defined as the technical procedures and legal requirements surrounding energy customers’ ability to 
connect their small-scale renewable energy projects to the electricity grid. U.S. Department of Energy, Renewable Energy: 
Distributed Generation Policies and Programs, https://www.energy.gov/eere/slsc/renewable-energy-distributed-generation-
policies-and-programs (last visited Jan. 9, 2022). 
27
 USDE, Grid-Connected Renewable Energy Systems, supra at n. 24. 
28
 Id. 
29
 Id.  
30
 PSC, SB 1024 Analysis, supra at n. 10, p. 1. 
31
 Id. 
32
 Section 366.91, F.S.  BILL: CS/CS/SB 1024   	Page 5 
 
metering, customers are credited for excess energy produced which flows back to the grid. A 
meter is used to record both electricity drawn from the grid and excess electricity that flows to 
the grid from the customer-owned system.
33
 
 
Florida’s net metering rule was established in 2008 requiring IOUs to offer a standardized 
interconnection agreement for expedited interconnection and net metering of customer-owned 
renewable generation up to two megawatts.
34
 The rule’s purpose is to: 
Promote the development of small customer-owned renewable generation, 
particularly solar and wind energy systems; diversify the types of fuel used 
to generate electricity in Florida; lessen Florida’s dependence on fossil fuels 
for the production of electricity; minimize the volatility of fuel costs; 
encourage investment in the state; improve environmental conditions; and, 
at the same time, minimize costs of power supply to investor-owned utilities 
and their customers.
35
 
 
Under the rule, customers are categorized into tiers, with varying requirements, based on system 
capacity:
36
 
 Tier 1 Systems, have a capacity of 10 kilowatts or less; there is no application fee, no 
interconnection study requirement, no insurance requirement, and no manual disconnect 
switch requirement. 
 Tier 2 Systems, have a capacity greater than 10 kilowatts and less than 100 kilowatts; there is 
an application fee if approved by the PSC, no interconnection study requirement, a $1 million 
insurance requirement, and a manual disconnect switch requirement. 
 Tier 3 Systems, are greater than 100 kilowatts and less than 2 megawatts; there is an 
application fee if approved by the PSC, an interconnection study may be required, a $2 
million insurance requirement, and a manual disconnect switch requirement. 
 
All electric utilities, as defined in s. 366.02(2), F.S., must annually report the total: 
 Number of customer-owned renewable generation interconnections; 
 Kilowatt capacity of the interconnections;  
 Kilowatt hours received by interconnected customers from the utility; 
 Kilowatt hours received by the utility from the interconnected customers; 
 Energy payments made to interconnected customers energy generation delivered to the utility 
for the previous calendar year; and 
 Energy payments made since the implementation of the net metering rule.
37
 
 
In 2008, there were 577 customer-owned renewable generation interconnections.
38
 As of 
December 31, 2020, Florida electric utilities reported a total of 90,552 interconnections, of which 
90,518 were solar; and 71,567 interconnections were for IOU customers, of which 71,541 were 
solar.
39
 Less than one percent of Florida’s electric customers have installed renewable generation 
                                                
33
 USDE, Grid-Connected Renewable Energy Systems, supra at n. 24. 
34
 Fla. Admin. Code R. 25-6.065(3). 
35
 Fla. Admin. Code R. 25-6.065(1). 
36
 Fla. Admin. Code R. 25-6.065(4). 
37
 Fla. Admin. Code R. 25-6.065(10). 
38
 PSC, SB 1024 Analysis, supra at n. 10, p. 2. 
39
 PSC, 2020 Interconnection and Net Metering Report, supra at n. 23.  BILL: CS/CS/SB 1024   	Page 6 
 
equipment as of the 2020 Report.
40
 In comparison, there were 10,504,960 electric utility 
customers in Florida, as of January 1, 2021.
41
 
 
Net Metering Billing 
When net metering customers generate excess energy that is delivered to the IOU’s grid, they 
receive an excess energy credit toward their energy consumption for the next month’s billing 
cycle.
42
 The value of the excess energy is equivalent to the utility’s retail rate that includes the 
cost of generation, transmission, distribution, fuel, operating and maintenance expenses and 
other costs
43
. Excess energy credits may be carried over to credit energy usage in subsequent 
months, but not for more than twelve months.
44
 At the end of each calendar year, the IOU pays 
the customer for any unused excess energy credits at an average annual rate based on the “IOU’s 
as-available energy tariff.”
45
 “The utility’s full avoided costs and the utility’s as-available tariff 
rate are not the same. “Full avoided costs” can include capacity and energy avoided costs, while 
the “as-available rate” only includes avoided energy costs, which is largely fuel.”
46
 
 
Net metering customers still receive a monthly bill, regardless of their energy usage from the 
grid.
47
 Net metering customers must pay any applicable customer charge and the applicable 
demand charge.
48
 This may include a fixed monthly customer charge, a base facility charge, 
volumetric rates for cents per kilowatt hour based on the customer’s energy consumption, or 
demand rates based upon the maximum kilowatt demand in a monthly billing cycle.
49
 
 
PSC Workshop on Net Metering 
On September 17, 2020, the PSC held an informational workshop on customer-owned renewable 
generation, for the purpose of evaluating the effect of the current net metering policy. The 
                                                
40
 PSC, SB 1024 Analysis, supra at n. 10, p. 3. 
41
 PSC, SB 1024 Analysis, supra at n. 10, p. 3 citing PSC, Review of 2021 Ten-year Site Plans of Florida’s Electric Utilities, 
p.13, available at http://www.psc.state.fl.us/Files/PDF/Utilities/Electricgas/TenYearSitePlans/2021/Review.pdf (last visited 
Jan. 9, 2022). 
42
 Fla. Admin. Code R. 25-6.065(8)(e). 
43
 PSC, SB 1024 Analysis, supra at n. 10, p. 2. 
44
 Fla. Admin. Code R. 25-6.065(8)(f). 
45
 Id. According to the PSC, as-available energy is purchased by the utility at a rate, in cents per kilowatt-hour, not to exceed 
the utility’s avoided energy cost. 
46
 PSC, SB 1024 Analysis, supra at n. 10, p. 2. 
47
 Fla. Admin. Code R. 25-6.065(8)(h). 
48
 Id. 
49
PSC, SB 1024 Analysis, supra at n. 10, p. 2.  BILL: CS/CS/SB 1024   	Page 7 
 
workshop included presentations by PSC staff,
50
 Vote Solar,
51
 Southern Alliance for Clean 
Energy,
52
 Florida Solar Energy Industries Association,
53
 and Florida Sunrun.
54
 
 
Net Metering Customer Demographics 
The following demographic information has been identified by FPL and Gulf,
55
 respectively, 
among their net metered customers: 
 Average Age: 54 years and 47 years. 
 Percentage of Homeowners: 96% and 80%. 
 Average Length of time in their Residence: 12 years and 9 years. 
 Household Income greater than $50,000: 67% and 59%. 
 Household Income greater than $100,000: 34% and 22%.
56
 
 
Cross-Subsidization 
Concerns of cross-subsidization of net metered customers by non-net metered customers have 
been raised before the PSC.
57
 Questions relate to the components of the utility’s cost of service 
that are offset by energy generated by net metered customers.
58
 These questions are partly based 
on net metered customers purchasing less energy from the grid,
59
 because a utility is statutorily 
entitled to recoup its “honestly and prudently invested costs of providing electric service to its 
customers,” regardless of customer use patterns.
60
 
 
There is disagreement among stakeholders as to the question of cross-subsidization and how to 
quantify it. Notably, the Solar Energy Industries Association states that “[s]ome level of cross-
subsidization is inherent in all rate designs, particularly for large diverse classes of ratepayers an 
independent finding of a material cost shift should be required before regulators authorize 
substantial changes to rates or rate design.”
61
 
 
                                                
50
 Matthew A. Vogel, PSC Office of Industry Development and Market Analysis, Staff Presentation Workshop on Customer‐
owned Renewable Generation (September 17, 2020) available at 
http://www.psc.state.fl.us/Files/PDF/Utilities/RenewableGenerationWorkshop/PSC.pdf (last visited Jan. 9, 2022). 
51
 Vote Solar, The State of Rooftop Solar in Florida (September 2020) available at 
http://www.psc.state.fl.us/Files/PDF/Utilities/RenewableGenerationWorkshop/VoteSolar.pdf (last visited Jan. 9, 2022). 
52
 Bryan Jacob, Southern Alliance for Clean Energy Comments on Net Metering (September 17, 2020) available at 
http://www.psc.state.fl.us/Files/PDF/Utilities/RenewableGenerationWorkshop/SACE.pdf (last visited Jan. 9, 2022). 
53
 Justin Hoysradt, Florida Solar Energy Industries Association, Net-Metering Powers Job Growth, available at 
http://www.psc.state.fl.us/Files/PDF/Utilities/RenewableGenerationWorkshop/FSEIA.pdf (last visited Jan. 9, 2022). 
54
 Florida Sunrun, NEM is working for the Sunshine State (September 2020) available at 
http://www.psc.state.fl.us/Files/PDF/Utilities/RenewableGenerationWorkshop/FloridaSunrun.pdf (last visited Jan. 9, 2022). 
55
 Now merged. 
56
 FPL, FPL and Gulf Post-Workshop Comments, p. 6, available at 
https://www.floridapsc.com/Files/PDF/Utilities/RenewableGenerationWorkshop/FPLGulfPostWorkshop.pdf (last visited 
Jan. 9, 2022). 
57
 PSC, SB 1024 Analysis, supra at n. 10, p. 4. 
58
 Id. “For example, questions have been raised as to whether the excess energy offsets the utility’s cost of power plants, 
given that power plants must be available to meet a renewable energy customer’s electric needs when their systems are not 
operating or when their demand exceeds the capability of their renewable energy system.” Id. 
59
 Id. 
60
 Section 366.06, F.S.; PSC, SB 1024 Analysis, supra at n. 10, p. 4. 
61
 See Solar Energy Industries Association, Principles for the Evolution of Net Energy Metering and Rate Design, available at 
https://www.seia.org/initiatives/principles-evolution-net-energy-metering-and-rate-design (last visited Jan. 9, 2022).  BILL: CS/CS/SB 1024   	Page 8 
 
According to Vote Solar, Florida’s current level of solar adoption results in a negligible impact 
on customer rates.
62
 Projections for cross subsidization among the general body of ratepayers for 
four of Florida’s IOUs result in estimates of a cumulative cross-subsidy of over $700 million by 
2025.
63
 
 
Energy Devices Based on Renewable Resources 
Current law expressly prohibits ordinances by governing bodies which prohibit the installation of 
solar collectors, clotheslines, or other energy devices based on renewable resources.
64
 Deed 
restrictions, covenants, declarations, or similar binding agreements may not prohibit such devices 
from being installed on buildings erected on the lots or parcels covered by binding agreements.
65
 
However, governing entities may determine the specific location of solar collectors installed on 
roofs, within an orientation to the south or within 45° east or west of due south, so long as it does 
not impair the devices effective operation.
66
 These provisions are intended to encourage the 
development and use of renewable resources and prevent the adoption of measures that 
ultimately drive up the costs of owning and operating commercial or residential property.
67
 
III. Effect of Proposed Changes: 
Section 1 amends s. 163.04, F.S., relating to energy devices based on renewable resources, to 
allow governing entities with a deed restriction, covenant, declaration, or similar binding 
agreement affecting the alteration of residential dwellings or within the boundaries of a 
condominium unit to prohibit the installation of solar collectors in locations outside of 
specifically designated parameters. 
 
Section 2 amends the legislative findings, under s. 366.91, F.S., relating to renewable energy, to 
state that: 
 The continued development of renewable energy resources in a fair and equitable manner to 
all public utility customers is in the public interest. 
 A net metering rule redesign is supported by the development and maturity of the industry, 
the decline in solar panel costs, and increased customer-owned/leased renewable generation. 
 Customer owned/leased renewable generation is not available to public utility customers 
lacking financial resources or otherwise residing in multitenant buildings. 
 The industry’s growth has resulted in increased cross-subsidization of electric service costs 
onto the general body of ratepayers. 
 The redesigned net metering rate structures must ensure that customers who own or lease 
renewable generation pay the full cost service. 
 
The bill requires the PSC to propose a revised net metering rule by January 1, 2023. The revised 
rule must meet the following criteria: 
                                                
62
 See Vote Solar Post Workshop Comment.  
63
 FPL and Gulf Post-Workshop Comments, supra at n. 50, p. 7. 
64
 Section 163.04(1), F.S. 
65
 Section 163.04 (2), F.S. 
66
 Id. 
67
 Section 163.04(4), F.S.  BILL: CS/CS/SB 1024   	Page 9 
 
 Rate structures and billing must ensure that customers owning or leasing renewable 
generation pay the full cost of electric service and are not subsidized by the general body of 
ratepayers. 
 Ensure that all energy delivered by the public utility is purchased at the applicable retail rate. 
 Ensure that all energy delivered by customer generation to the public utility is credited to the 
customer as follows: 
o During calendar years 2024 and 2025, the credit is 75 percent of the public utility’s retail 
rate; 
o During calendar years 2026 and 2027, the credit is 50 percent of the public utility’s retail 
rate; and 
o During calendar year 2028, the credit is the public utility’s full avoided costs to the public 
utility’s full avoided cost. 
 Net metering may include fixed charges, base facilities charges, electric grid access fees, or 
monthly minimum bills, to ensure that the public utility recovers the fixed costs of serving 
those customers and that the general body of ratepayers does not subsidize customer 
renewable generation. 
 
The bill allows customers who own or lease renewable generation before January 1, 2023, to 
continue under the existing net metering rate design and rates for twenty years from that date. 
This provision also applies to customers who purchase or lease real property with renewable 
generation systems installed for all or part of the twenty-year period. 
 
Under the bill, the PSC must require a public utility requesting a change in base rates under 
s. 366.06, F.S., to report the net metering impact on the public utility’s revenue and cost of 
service. 
 
Section 3 provides that the bill is effective July 1, 2022. 
IV. Constitutional Issues: 
A. Municipality/County Mandates Restrictions: 
None. 
B. Public Records/Open Meetings Issues: 
None. 
C. Trust Funds Restrictions: 
None. 
D. State Tax or Fee Increases: 
None.  BILL: CS/CS/SB 1024   	Page 10 
 
E. Other Constitutional Issues: 
None. 
V. Fiscal Impact Statement: 
A. Tax/Fee Issues: 
None. 
B. Private Sector Impact: 
There may be an indeterminate impact on the solar installation and manufacturing 
industry if fewer customers purchase rooftop solar as a result of the redesigned net 
metering rate structure.
68
 
 
Decreasing the credit amount from the retail rate to the full avoided cost may impact a 
customer’s decision to install a renewable generation system.
69
 The average full life of 
renewable energy generating equipment is approximately 20 years.
70
 Customers who 
have already installed systems under the current net metering rule may find that they will 
have a lower return on their investment than initially predicted.
71
 
 
Decreasing the credit amount from retail to the full avoided cost may have a positive 
impact on the IOUs, where projections of the cumulative cross-subsidy to be absorbed by 
non-net metered customers of FPL, Gulf, TECO, and Duke for 2020 through 2025 total 
$719 million.
72
 
C. Government Sector Impact: 
None. 
VI. Technical Deficiencies: 
 The provision prescribing the renewable generation credit rates from the public utility to the 
customer is silent as to the appropriate credit rate after the 2028 calendar year, in which the 
applicable credit is the public utility’s full avoided costs. Clarification is needed as to whether 
the utility’s full avoided costs is the applicable rate after 2028. 
VII. Related Issues: 
None. 
                                                
68
 PSC, SB 1024 Analysis, supra at n. 10 p. 5. 
69
 Id. 
70
 Id. 
71
 Id. 
72
 FPL and Gulf Post-Workshop Comments, supra at n. 50, p. 7.  BILL: CS/CS/SB 1024   	Page 11 
 
VIII. Statutes Affected: 
This bill substantially amends sections 366.91 and 163.04 of the Florida Statutes. 
IX. Additional Information: 
A. Committee Substitute – Statement of Substantial Changes: 
(Summarizing differences between the Committee Substitute and the prior version of the bill.) 
CS/CS by Community Affairs on February 8, 2022: 
The CS provides that energy delivered by a customer to the public utility will be credited 
at 75 percent of the utility’s retail rate in 2024 and 2025, 50 percent in 2026 and 2027, 
and credited at the public utility’s full avoided costs in 2028. The amendment also 
extends the grandfathering provision for existing interconnection agreements from 10 to 
20 years. 
 
CS by Regulated Industries on January 11, 2022: 
The CS amends s. 163.04(3), F.S. to allow governing entities with a deed restriction, 
covenant, declaration, or similar binding agreement affecting the alteration of residential 
dwellings or within the boundaries of a condominium unit to prohibit the installation of 
solar collectors in locations outside of the parameters specified in s. 163.04(2)(a), F.S 
B. Amendments: 
None. 
This Senate Bill Analysis does not reflect the intent or official position of the bill’s introducer or the Florida Senate.