COVINGTON — Customers using solar power as their main source of energy are asking the Covington City Council to do away with an annual “solar standby fee” of $400. The customers say the fee cuts their savings almost in half and discourages others from converting to solar power.
The standby fee is charged to all users of alternative energy sources, such as solar, to ensure conventional city-provided power is able to be supplied in case of an alternative energy source failure.
Several people spoke to the City Council during the public comment portion of the council’s meeting on July 1. Sara Vinson and her husband have a business office in Clarks Grove and pull five kilowatts of energy from their solar panels, which saves them approximately $900 a year on electricity.
But Vinson said the $400 standby fee can make the installation of solar prohibitive to many people. She added they feel they are being unfairly taxed compared to other residents who try to save money and power in different ways.
Residents with solar power “pay what amounts to a 44 percent tax on their electricity savings that the city doesn’t apply to households that install other energy saving technology such as LED lightbulbs, NEST thermostats, and high efficiency appliances,” Vinson said.
Vinson went on to state that if there were 20 homes in the city that used solar power, that works out to about $18,000 a year that the city doesn’t receive in revenue from its Electric Department and said the loss of $18,000 would have a negligible effect on the budget.
Karen Couch said she and her husband don’t own a home inside the city limits, but that they get their power from Covington utilities. She said they are considering moving to solar power, but that they live on a fixed income and the standby tax would mean having to cut their budget in other areas. She said other cities have done away with the standby tax and urged Covington to do so, too.
“Oxford got rid of it, and it seems like if they are that forward-thinking, then the city of Covington should be,” Couch said. “I think of this as a very wonderful town. My daughter lives in Covington, but she also made the decision not to go solar because of the standby fee. It just seems unfair to me, so I would like you to reconsider it.”
Maurice Carter implored the council to begin moving away from using transfers from its utilities funds to cover the general fund budget, stating that the transfers discourage fiscal responsibility.
“The budget includes $10.2 million in transfers in from other funds,” Carter said. “That’s 41 percent of our budget... Once upon a time, electric and gas augmented our city (revenue), but they are now the primary sources of our revenue.
“You guys are like any other elected officials — you face the challenges that people want lower taxes, but they want more services. This (the transfers) has been a way to avoid that difficult decision — when all else fails, we can just shift a little more over from the right pocket to the left pocket. But I don’t believe it is sustainable.”
Carter said Covington is sending a message to its citizens that the city won’t let them move to renewable energy, such as solar, because the city is “addicted” to the revenue the electric utility brings in. He urged the council to start trying to fund the city without the dependency on the electric revenue.
“We need to do that fiscally so that we have a sustainable future,” he said, “and so we can let our residents make smart choices for themselves when they choose to do so.”
During council comments at the end of the meeting, Susie Keck noted that she has not had one person contact her wanting to install solar other than the Solar Newton-Morgan group that is promoting the use of solar power.
“So if we have residents in the city of Covington that do want to install solar energy on their homes, please contact me and let me know that $400 is preventing you from getting solar,” Keck said. “If that is something that the majority of Covington would like to see us do — take away that $400 fee for solar — then for the $18,000 we’d lose from those 20 customers, that would be $18,000 worth of services that we’d cut or pass it on to their property taxes. I would just like to know what people think about solar. Right now, I haven’t heard the outcry.”