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Health & Fitness

A Raw Deal

Last week I wrote about a memo from the nation’s top national law firm explaining that solar Feed-in-Tariffs (FITs) and Value of Solar Tariffs (VOSTs) hold hidden, negative tax implications for consumers.  

Under FITs and VOSTs, says the memo from Skadden, Arps, Slate, Meagher & Flom, consumers are ineligible for a 30 percent federal investment tax credit, and they’ll owe income taxes on the payments they receive for the solar power they feed back to the grid.  Exchanging tax credits for taxes? Sounds like a raw deal to me, and not one that California policymakers should inflict on homeowners. 

As reported by Greentech Media, even “godfather of the U.S. FIT movement,” Paul Gipe, confirms these negative tax implications.

Since the memo came out, I’ve also been watching news unfold in California’s sunny neighbor to the southeast, Arizona. Arizona Public Service is trying to impose a FIT on solar customers – in other words, tax them – and the latest poll results show APS’ corporate image taking a serious beating as a result. Here are a few highlights from a recent poll by Public Opinion Strategies:

The APS proposal is a corporate image nightmare: Voters gave APS a 44% favorable rating and a 19% unfavorable rating for a net 25-point positive image (44%-19%). Salt River Project, meanwhile, enjoys a net positive image of 59 points.

Voters are now even bigger proponents of solar power: When asked which of many sources of energy they would MOST want to encourage in Arizona, two-thirds (67%) of voters say solar, compared with 58% in March. Only ten percent (10%) said they would most want to encourage nuclear power.

It would be political malpractice for elected officials to vote to end the existing solar power program: In another uptick since March, 84% of voters say they would be less likely to vote for a candidate who voted to end the solar power program in Arizona (80% in March), with a majority (58%) saying they would be much less likely to vote for that candidate.

So how does this translate to California? In short: doing away with net metering (NEM), in which solar customers get full retail value for the power they feed back to the utility, is a corporate image nightmare and political suicide. Not to mention, it would stifle solar adoption, which is bad for both the economy and the environment.

This article originally appeared on The California Majority Report.

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