[Congressional Record Volume 162, Number 20 (Wednesday, February 3, 2016)] [Senate] [Pages S533-S535] From the Congressional Record Online through the Government Publishing Office [www.gpo.gov] SOLAR ENERGY Mr. KING. Mr. President, the Democratic leader has just outlined the issue that is before us today. I want to put it into some context. The first thing I want to say is that what we are talking about today is the most fundamental of American economic principles--free-market competition. Free-market competition is what we are talking about here. Now, as the Democratic leader outlined, for 135 years, our electrical system worked basically in the same way that it works today. It has worked because of central powerplants, wires, distribution and transmission systems, and homes. Homes and businesses and offices were the passive receptors of electricity. The utilities have done a wonderful job. I have worked with them over the years. They have done a complex job where the power has to be there when the switch is thrown. They have done a terrific job of serving the American public, but what the American public wants is not necessarily electricity itself, it wants what electricity can do. A friend of mine once said, for example, that in this country every year, 5 million people buy quarter-inch drills, but nobody wants quarter-inch drills. What they want are holes. What the American people want are microwaves and televisions and computers and electricity and hot water in their homes. How that power comes is really not what they are concerned with, but they do want options. A revolution has occurred. Without a doubt this system served us well for 130 years, but a revolution has occurred in the last 25 years. This chart dramatically shows what has happened. This is the price of a watt of solar energy. In the 1970s it was $76. Today it is 36 cents. This is revolutionary. This is disruptive. This is change. What this has enabled is for us to now tap into that very large, fully permitted nuclear fusion device in the sky that delivers power wirelessly to every city, town, village and hamlet on Earth. That is what we are talking about. Why is this important? For a number of reasons. If you combine the cheaper solar power with smart appliances that can use their power only when it is the most efficacious for the grid--smart meters that many of our grids now have, demand response that allows customers to diminish their demand at times of high demand on the grid, and new storage technologies, if you add all of those together, it is an entirely new world of electricity development. This is where we are today. We still have central powerplants. We still have wires, but we have homes and businesses making their own electricity and storing their own electricity from that big nuclear fusion [[Page S534]] plant up in the sky. This is a good development. No. 1, it empowers consumers. It empowers families. Mr. REID. Will the Senator yield for a question? It is also true, is it not, as we speak, that there is tremendous work being done on battery storage. That will change it even more; is that right? Mr. KING. That is absolutely correct. That I will touch on in a moment. That potentially changes the relationship with utilities and with the grid system. This is a good thing. This provides competition. Our whole system is based upon competition. Everybody here talks about the power of the market. That is what we are talking about here. It strengthens the grid by making it more resilient because power is going in two directions. We had a huge ice storm in Maine in 1998. The power went off. Everybody lost their power--600,000 people. The people who had generators in their homes could make their own power, but those were very few people. Now we are talking about a grid that is not wholly dependent upon a central powerplant but power goes in both directions. I am on the Intelligence and Armed Services Committees. This is a national security issue. One of the great vulnerabilities of this country is a cyber attack on critical infrastructure. To the extent this infrastructure is self-healing and distributed, it is less subject to a catastrophic attack. It saves money because it saves money on distribution and powerplants if people are making their own investments and you don't not need the level of transmission and distribution wires. Of course it could substantially reduce our dependency upon fossil fuels. There are two possible reactions to this from the utility companies. One is to adopt, adjust, and reinvent themselves, as companies have done. I remember New England Tel. New England Tel is now Verizon. If they were still focused exclusively on landlines with the old black telephones, they would be long gone. Instead, they reinvented themselves because of a change of technology, and now they are one of the Nation's leading wireless providers. AT&T used to be Ma Bell. Now it is a leading wireless provider because they adapted, and they changed their whole business model based upon new economic realities. That is one option. There are utilities in the country that are adopting that option; that are finding new business models, relationships with their customers, in order to participate in this system and be counselors and energy providers and consultants to their customers in this new world. On the other hand, they can fight, resist, and try to delay. That is what we are talking about here today. That is what has happened in Nevada, imposing high fixed fees that ostensibly are to recover the costs, but everybody knows the real purpose is to strangle this industry in its infancy. I think those companies should think about the examples of Packard, Kodak, and Polaroid that failed to adapt, that failed to take account of new technological realities and ultimately failed. I don't think that is the future these companies want. This amendment is not a Federal takeover of State utility regulations. It provides guidance. It uses the term ``take into account.'' All it says is that if you are going to change a net metering regime, or if you are going to impose fees, they have to be based upon data and analysis, not arbitrary fees that are designed to strangle the industry. It is not a mandate for net metering or any other kind of payment. Again, what we are trying to do is to make sure that the benefits to the grid from a home installation--whether it is demand, response, storage, whatever--are measured as well as the cost. The issue is very simple. It is fair compensation to the customer for the energy they produce or save and fair compensation to the utility for maintaining the grid. I know there are costs to the utility for maintaining the grid, and they have to be fairly compensated. But the question is fair. What is the right number? An arbitrary exorbitant fee that essentially makes the development of solar or storage unfeasible is not the right number. The Democratic leader mentioned storage, and this is really an essential part of the discussion. As storage technology improves, this is where the utilities are most exposed. In my view, utilities are in a race with battery technology in order to determine who is going to provide the backup to the solar, wind, and demand response facilities in the house. Who is going to provide the backup? If the utilities insist upon high, unreasonable fees, eventually--and I think ``eventually'' is within 5 years; it is not 10 years, 20 years or 30 years--people are going to say: I am going to do my own storage, my own backup in my basement, and cut the wires. Then the utility has lost the customer all together, and I don't think that makes any sense. The real point is that change is coming anyway. The only question is whether it happens fairly, deliberately, and expeditiously and is fair to the customers as well as the utilities or whether it goes through a long series of individual fights State by State. Mr. REID. Will the Senator yield for a question? Mr. KING. I yield to the Democratic leader. Mr. REID. I am wondering if my friend is aware of a couple of examples. In Nevada there is Tesla and Elon Musk. It is a massive company. He is building batteries for his vehicles and other things. The Tesla plant I toured a few months ago is under construction. As to the floor plan, the only place in America with a bigger manufacturing facility is the Boeing plant in Washington. That is how huge it is. The man who is running that plant for him indicated to me that they had found that the price, as indicated by the Senator from Maine, was so cheap with solar that it is going to be basically mostly solar, nothing else. Was the Senator aware of that? Mr. KING. Absolutely, and I think that is what has to be part of the discussion, because if the utilities insist on fighting and trying to overprice their storage, people are just going to say: I am going to buy my own storage, put it in the basement, and cut the wire. Mr. REID. And remember what he is manufacturing in this huge facility is batteries. So I would think Elon Musk, who has been sending people and cargo into space, is going to come up with an idea to make better batteries. I would also suggest to my friend that the example of Packard and Kodak were very good examples. But more modern, I read a book a few months ago about Reed Hastings, the owner of Netflix, who had already been successful in another line of work when he went into Netflix. We all remember Blockbuster, where we would go to rent our movies. He went to Blockbuster and he said: I have an idea; here is what I would like to do. They said: No, that is just a niche business. We are not interested. Blockbuster is gone, and Netflix is every place. So the same thing is going to happen one way or another to these monopolies that have the power in our States. They should work something out to make sure they are ahead of the curve. Otherwise, they are going to be behind the curve--and fairly quickly. Would the Senator agree with that? Mr. KING. I would agree, and that is exactly where I would conclude. I am not anti-utility. I am pro-customer. I am pro-competition. I am pro-free markets. I believe the utilities have a tremendous opportunity here to modify and adapt their business model to maintain their relationship with their customers. But if they do not, then I am afraid that technological changes such as storage are going to overtake them, and they could go the way of Kodak, Blockbuster, and Polaroid. I don't want to see that happen because I think they have a tremendous value to contribute to this discussion. I conclude by saying that this amendment is really a modest one. It is not a takeover of the regulatory process. It simply urges and advocates that the State public utilities commissions take into account the positive factors of solar as well as the costs in order to reach a fair compensation agreement between utilities and their customers. This is the future. It is going to happen. The only question is whether it happens efficiently, fairly or by fighting. I would prefer the former option. I think this is an important part of the future of this country, and we have an important role to play in this body. [[Page S535]] I urge support for this amendment. I yield the floor. The PRESIDING OFFICER. The Senator from Massachusetts. ____________________