Editor’s note: This commentary is by Kevin B. Jones, PhD, who is a professor of energy technology and policy at Vermont Law School. He can be contacted at energyclinic@vermontlaw.edu.
[T]he sharing economy and solar energy seem like such a natural combination, kind of like apple pie and vanilla ice cream. Green Mountain Power and Yeloha’s recent press release announced that “Yeloha and GMP will make it possible for individuals who don’t have a roof suited for solar to subscribe online to power produced by other homeowners and businesses, essentially going solar on someone else’s roof.”
It almost sounds too good to be true and perhaps it is, as demonstrated by the multiple communications I received, raising concerns about the potential deceptive nature of GMP and Yeloha’s claims. In order for GMP and Yeloha’s claims about “going solar on someone else’s roof” to be accurate, these companies would have to provide the sharing partner with the renewable energy certificates (RECs) associated with these claims. Contrary to the marketing claims, going to the frequently asked questions on Yeloha’s website supports that Yeloha sells the renewable energy certificates to a third party, and the solar host and sharing partner do not receive the RECs or payment for them. See http://support.yeloha.com/knowledgebase/articles/603654-does-my-solar-energy-system-produce-solar-renewabl .
In the press release, GMP CEO Mary Powell states, “This is a unique opportunity to empower more people to be able to harness the power of the sun. … We see a tremendous opportunity in leveraging more rooftops around Vermont for the benefit of all those who may currently be renters, or own homes that are not well suited for solar.”
If the Yeloha website is accurate and the RECs are sold separately for profit, what GMP and Yeloha’s version of the sharing economy will provide to these “renters” is electricity largely powered by fossil fuels and nuclear isotopes rather than local, low carbon, solar energy.
Making false green claims is not legal as the Federal Trade Commission pointed out to GMP in a letter earlier this year.
When electric customers believe they have purchased solar energy, but instead their solar energy is sold to a third party, less solar power is produced than consumers demand. Deceptive claims by a marketer harm the consumer, the solar industry and the environment.
Making false green claims is not legal as the Federal Trade Commission pointed out to GMP in a letter earlier this year, “By selling RECs, a company has transferred its right to characterize its electricity as renewable.” Accordingly, the Code of Federal Regulations advise that, if “a marketer generates renewable electricity but sells renewable energy certificates for all of that electricity, it would be deceptive for the marketer to represent, directly or by implication, that it uses renewable energy.” See 16 C.F.R. § 260.15(d) at http://goo.gl/s8xzQ0.
Unfortunately the concerns raised by this press release are not an isolated issue. In 2013, following a press release from GMP and the national energy firm NRG that marketed an NRG project in Rutland as community solar, Powell stated to the Vermont news media: “Through this partnership, customers who have no space for solar or can’t afford to build it themselves will be able to rely on solar energy and support its construction through a low-cost lease program. … Many participants are likely to pay less for solar energy than they are paying today on their electric bills.” Contrary to these claims, the fine print on the NRG agreement notes that the RECs are retained and sold separately by NRG and the agreement informs the customer that “{Y}ou may not claim publicly that You are using renewable energy or solar energy.”
If, as the Yeloha website states, Yeloha separately sells the RECs to a third party and not to the host or the sharing partner, then GMP and Yeloha have some explaining to do. What is this product that GMP is marketing to its customers if customers are not being sold solar energy? What if any financial benefit does GMP receive from Yeloha in regards to marketing this product?
GMP has previously been warned by the FTC, which concluded in its 2015 letter to GMP that, “while Vermont consumers do not have a choice of electricity providers, they can choose to use less electricity, generate their own electricity at their homes, or switch fuel types. Accordingly, we urge that GMP carefully review its current and future communications to ensure that Vermont customers, and other market participants, clearly understand that GMP sells RECs for many of its renewable facilities and thus has forfeited its right to characterize the power delivered from those facilities as renewable, in any way. If we identify concerns in the future, we reserve the right to take further action.”
When inaccurate green claims are made about solar energy, honest Vermont solar companies are harmed, the consumer is harmed, and the environment is harmed.
