This week, the Washington Utilities & Transportation Commission ("UTC") issued its long-awaited policy statement concerning UTC jurisdiction over third-party owners of net-metered electric facilities, such as roof-top solar systems. The Interpretive Statement indicates that the UTC likely would assert at least limited jurisdiction over third-party owners of rooftop systems who contract with ordinary homeowners. Much of the Interpretive Statement, however, is a cry for help addressed to the Washington legislature, urging it to enact legislation addressing the unique jurisdictional and regulatory issues arising in this unique context.
As noted here, the UTC last year concluded that Washington's net metering statute allows for third-party ownership of rooftop solar systems, opening the door to innovative financing structures that have allowed rapid growth of distributed solar power in other states. However, the UTC left open one critical legal question -- whether the third-party owners of net metered systems operating under such leasing structures would be subject to UTC jurisdiction, and therefore potentially subject to the full range of utility-style regulation. While the Interpretive Statement is likely to disappoint those looking for a definitive statement from the UTC, it provides useful guidance both as to the UTC's concerns with third-party financing arrangements and the type of regulation the UTC likely would impose in those situations where it asserts jurisdiction. While not definitive, the Interpretive Statement, along with Washington's lucrative incentives for solar development and a recent change in the state's building code reducing upfront engineering costs, should spur development of distributed generation in the state.