Business

Solar Industry Nonprofit Accuses KCP&L of Foul Play

 

MOSEIA claims KCP&L mailed solar rebate checks directly to an installer instead of the account holder and requested the Missouri Public Service Commission conduct a formal investigation. KCP&L issued a response to the allegations. 

On Friday, July 12, the Missouri Solar Energy Industries Association (MOSEIA) filed a request for the Missouri Public Service Commission to investigate what it claims to be “excessive and improper payments” by Kansas City Power Light (KCP&L) to St. Joseph, Mo.-based solar installation company U.S. Solar.

MOSEIA is a nonprofit trade organization dedicated to strengthening and expanding the solar industry in Missouri. Its 70+ members include solar designers, developers and installers, manufacturers and distributors, and community colleges with solar training programs. MOSEIA notified members of the media that it received an ethics violation complaint filed by a customer of U.S. Solar and KCP&L regarding a May 2012 installation in St. Joseph.

“For a time, it appears KCP&L was mailing solar rebate checks directly to the installer rather than the account holders, an unusual action that has not been taken with other installers,” MOSEIA reports in a Monday, July 15, press release.

On Thursday, July 18, KCP&L issued the following response: “In the past, KCP&L allowed customers to designate the address where they would like solar correspondence and their rebate check sent. However, in January of this year, KCP&L changed its policy to mandate that rebate checks be sent directly to customers at their address of record with KCP&L. This was to make sure that customers received their solar rebate check.

“It is ironic that MOSEIA is sending out press releases regarding where rebate checks are sent, when Susan Brown, vice president at MOSEIA, made the exact same request to KCP&L that they are not intimating as improper,” KCP&L continues. “In November of 2012, on behalf of Brightergy, a solar company where she is also an executive officer, Brown requested that KCP&L send future solar rebate checks directly to Brightergy instead of customers.”

The complaint alleges that U.S. Solar provided an 8.46-kilowatt system quote and copy of an 8.46-kilowatt application to the customer whose identity MOSEIA has not revealed. U.S. Solar submitted an application to KCP&L for a 16.45-kilowatt system (worth $32,100) solar rebate. It installed an 8.46-kilowatt system rather than a 16.45-kilowatt system. Then, KCP&L sent a check directly to U.S. Solar – not the customer – for $32,100.

“We are unaware of other installers allowed this special treatment of receiving account holders’ rebate checks.” ~ Heidi Schoen, executive director for MOSEIA.

After a “thorough review” of the complaint, MOSEIA expelled the installer on March 20, 2013. It then notified KCP&L in writing on June 3 requesting KCP&L “take immediate action and review the applications that they (U.S. Solar) have filed and verify that they are accurate and properly describe the installed systems.”Six weeks later, it has yet to receive a response back.

“MOSEIA’s assertion that they have never received a response to their June 3 request is categorically not true,” KCP&L says. “KCP&L immediately responded saying both orally and in writing, ‘We take allegations of any malfeasance associated with our solar rebate program very seriously and will investigate your assertions immediately.’ In multiple subsequent telephone messages with MOSEIA, KCP&L detailed plans to immediately conduct audits of the top 10 solar providers in the region to verify compliance with the rebate program’s requirements.” 

“Based on the information we have available, we strongly believe the Missouri Public Service Commission should conduct an independent audit,” says Heidi Schoen, executive director for MOSEIA. “In the event there have been improper payments made, we also believe that such payments should not be included in KCP&L’s calculation of any retail cap.”

“KCP&L treats all solar vendors in our service territory exactly the same. No solar vendor gets special treatment.” – KCP&L

Included with MOSEIA’s press release to KC Business was a copy of the letter Schoen wrote to Charles Caisley, vice president of marketing and public affairs for KCP&L.

“Our concerns include … rebate checks sent directly from KCP&L to U.S. Solar and not to the account holder,” the letter says. “We are unaware of other installers allowed this special treatment of receiving account holders’ rebate checks.”

“KCP&L treats all solar vendors in our service territory exactly the same,” KCP&L asserts. “No solar vendor gets special treatment.”

Schoen told Caisley that this issue is “even more pressing” due to KCP&L’s recent filing regarding the retail rate impact of the Renewable Energy Standard and expressed concern that “false system ratings on rebate applications” could lead to unnecessary inflation.

MOSEIA requested KCP&L immediately review its rebate applications from U.S. Solar and “take whatever steps are necessary to protect the solar rebate program,” Schoen pleaded. She also requested confirmation from KCP&L “that any overpayment of rebates does not count against the retail rate impact.”

Caisley sent KC Business the following statement: “We take the fair administration of all of our customer programs very seriously. Rather than sending out sensational media releases confusing customers and clouding the real purpose, which is increasing the subsidy the solar industry currently receives, we renew our request to MOSEIA to work with us at the Missouri Public Service Commission to ensure a transparent and fair solar rebate program for all of KCP&L’s 830,000 customers.”

With his statement, Caisley included a Thursday, July 11, press release announcing changes to the solar rebate program based upon a recent filing KCP&L made to the Missouri Public Service Commission that puts a limit of $21 million for 2013 solar rebate payments in Missouri, as required by Missouri State Law.

“We are proud of the leadership role KCP&L has played in advocating for and investing in renewable energy and energy efficiency in the state of Missouri, including our solar rebate program for customers,” Caisley says. “However, since our Missouri customers ultimately pay for these investments, it is very important that we ensure a transparent process for solar rebates and that the costs of this program are consistent with the law and allocated fairly across our customer base.”

The press release states that the 1 percent cap in KCP&L’s Greater Missouri Operations (GMO) service territory equates to slightly more than $10 million annually. As of June, the organization already had received applications for $22.2 million in solar rebates in its GMO territory and estimates that it will receive nearly $51 million in rebate applications for its entire Missouri service territory by the end of this year.

The Kansas City Metropolitan Area territory is expected to exceed the 1 percent cap by November. “Therefore, as part of the filing, KCP&L has requested approval to suspend solar rebates for KCP&L’s GMO territory from Sept. 3, 2013, until Jan. 1, 2014, due to the fact the solar rebate cap has been reached,” KCP&L states.

Meanwhile, it will continue to accept rebate applications until the first quarter of the following year when funding will become available again. The program will continue to be funded at the 1 percent cap until 2020, when solar rebates will be phased out and no longer available in Missouri.

“It’s about balance,” Caisley asserts. “Solar rebates are paid by all Missouri customers, which means that all Missouri customers will pay for these rebates whether or not they participate in the solar program. Managing these costs and ensuring customer rates won’t exceed 1 percent (for solar) is the reason we are suspending these rebate payments until next year.”