Dozens of solar power supporters packed the room on Tuesday to ask the Colorado Springs City Council to remove a new charge for net metering customers from the next rate plan for Colorado Springs Utilities. They got what they wanted.

The City Council voted 5-4 late Tuesday afternoon to reject the changes to net metering. The proposal will be removed from the rest of Utilities’ rate case for 2026, which was unanimously approved by the council and will return for a final vote on Oct. 28.

The proposal would have added a “demand charge” to net metering bills beginning in 2027. That would charge an extra fee to solar customers for the power used between 5 p.m. and 9 p.m. on weekdays. Utilities staff said the new fee was intended to even out the group’s rates with how much all other city customers pay for power during those peak hours and match the goals of the Energy Wise time-of-use rates being rolled out.

Councilmembers Kimberly Gold, Nancy Henjum, David Leinweber, Roland Rainey and Brandy Williams were the five who opposed the change. The issue will be sent back to the Utilities Board to decide if and when a new version of demand charges will be proposed.

Henjum and Williams had been the most vocally opposed to the change since it was first approved by the Utilities Board, which has the same members as the City Council, when it was first announced in October. Williams pointed out during the meeting that Utilities had provided three different versions of how the new system would calculate the demand charge and how it would impact customers.

“As a board member, this should be vetted beyond a shadow of a doubt,” Williams said. “I am not personally ready to move this forward until I feel like there is an answer and an answer that we are able to have a conversation about.”

The roughly 60 people who signed up to speak said they all opposed the net metering change. Residents said they would be hit with a massive rate increase, that the decision had been rushed, and they worried the new approach would make people less likely to install solar panels in the future.

“It discourages that very behavior, conservation and local generation, that we should be encouraging. Not to mention it will hurt our solar power industry,” local user Nancy Stilwagen said.

Many residents had spent tens of thousands of dollars to install solar panels at their homes. The proposed increase with the new charge was so large that many said they may never see enough rate savings to recoup the installation costs.

Air Force veteran Paul Burger and his family joined the net metering program in August, around a week before Utilities announced the changes. Burger said the City Council needed to do more research and not rush forward on this change.

“We are subjecting ourselves to being test subjects for a net metering proposal that has not really been rolled out at any scale in this country,” Burger said.

The net metering program allows residents who install solar panels on their homes to be credited by Utilities for the excess power generated by the panels during the day that goes to the grid. Solar power is usually generated during the day, when homes use less power than is produced. It can stack up credits that can be used that evening or months later for lower rates.

Colorado Springs Utilities proposed the new charges because the incentives worked too well. Over 9,000 homes, about 4% of the city’s residential power customers, are participating in the net metering program. The rapid growth of the program over the last seven years, combined with the expiration of rebates for new solar customers in 2022, led to a growing difference between solar users and the rest of the city’s power customers.

Utilities rate expert Scott Shirola said it had always been the case that the lower costs for net metering customers meant slightly higher rates for everyone else because everybody relied on the power grid during the peak weekday hours. The difference is called a cost shift for power. In Colorado Springs, Shirola estimated that each solar customer had around $600 in reduced utility payments that had to be accounted for.

“That was one thing when there were a thousand customers, but when there are 9,000 and another thousand coming on each year, that cost shift to other customers becomes more urgent to address,” Shirola said.

Net metering customers in the council chambers booed when Utilities staff said that they were getting subsidized power rates. Henjum said that word choice might have driven home how undervalued people felt about the way Utilities talked about the challenges of having a large residential solar program.

“I’m not hearing acknowledgment of their years of investment into the system. This set of customers does not feel seen or heard or valued for their commitment and partnership with the utility,” Henjum said.

Colorado Springs Utilities had initially announced that the demand charge would be based on the single highest peak use of power customers had between 5 and 9 p.m. during the month. Utilities had changed their approach in the last two months after receiving feedback from annoyed customers.

The proposal that was rejected on Tuesday would have roughly halved the demand charge from an average of $50 per month to $25. Utilities Chief Financial Officer Tristan Gearhart said the updated version would not fully cover the cost shift, but it would help establish the program to start gathering data from customers and encourage people to use less power during the peak hours.

Before the meeting, more than 20 speakers gathered in Acacia Park for a breakfast plan to prepare to speak to the city. That was set up by the Colorado branch of Solar United Neighbors, a nonprofit that advocates for residential solar

Solar United state organizer Tanner Simeon-Cox said he had been contacted by multiple worried customers and solar installation businesses after the net metering change was first announced by Colorado Springs Utilities. Simeon-Cox lives in Colorado Springs and had helped more than 900 customers across the state add solar panels this year.

“This sets back that payment program for folks. They may have had a timeline for when the panels would pay themselves off and this pushes that back but they can’t get out of it,” Simeon-Cox said.

KC Becker, CEO of the Colorado Solar and Storage Association, challenged the legality of the change. In 2004, Colorado voters passed Amendment 37, which requires utilities to generate some of their power from renewable energy. The state law passed in response established the net metering program and banned municipalities from discriminating against solar customers in the program or offering lower credits as a benefit for net metering.

The city attorney’s office responded that the state law gave local municipalities more flexibility to determine the net metering rates than other utility providers. The attorney said that the contracts net metering customers sign warned them that their rates were subject to change by the City Council.