California Solar Policies Under Threat

Monday, March 15th marked the beginning of deliberations in the California Public Utilities Commission over California's solar Net Metering rules.
 
Net Metering is the program that allows California home and business owners with rooftop solar to sell their excess power during the day to the utility companies. This program is the most important component to ensuring the viability of residential and commercial solar.

The program was created in 1995 and was modified in 2016 when the CPUC passed what has been called NEM 2.0. Part of the NEM 2.0 decision included the commission agreeing to keep credits tied to retail rates, rather than the less expensive wholesale rates, providing a big win for backers of solar. This component is likely to change.
Now, five years later, the CPUC plans to implement a further update to the program, NEM 3.0.
The big three investor-owned utilities — San Diego Gas & Electric, Southern California Edison and Pacific Gas & Electric — turned in a joint proposal that looks to resolve their complaints that net energy metering results in a “cost-shift” that unfairly burdens customers who do not have solar installations at their homes and businesses.
The joint proposal submitted by the three utility companies calls for changes that would affect only new solar customers, not existing net metering customers.
Below are the top three proposals from the state’s investor-owner utilities:

1. A proposed Distributed Generation Successor Tariff of roughly $24/month plus, a proposed Residential Grid Benefits Charge that would charge solar customers about $11 per kilowatt on a solar system. With a current average system size of 6kW, that would make for a minimum $90/month ($24 + $66) fee to the utilities just for putting solar on your roof.

 

1. While the existing system allows solar owners to “bank” the credits they get from producing excess solar over the course of a year, customers would “true-up” their accounts on a monthly basis instead. Most solar customers produce more energy than they use March-June and count on those credit rolling over so they can use them during the months they produce less than they use like July-August when they’re using the most amount of air conditioning. This change would equate to a dramatic loss in savings.

 

1. The credits for new customers could only be used in roughly the same time period of the day that the solar was actually generated. This is exactly why net metering was created, because we don’t necessarily use power at the same time that we produce power. This means if we generate credit during the day it could not be used to offset our power usage at night.

 
Needless to say, if the utilities companies get everything they want, this will largely end rooftop solar in California. They won’t get everything they want. The CPUC won’t allow for policies that will completely dismantle an enormous industry. They will however make changes that will lead to solar being less cost effective than it currently is.
If you’re reading this article and NEM 3.0 has not yet gone into effect and you still don’t have solar, it’s time to act fast. You don’t want to miss out on NEM 2.0.  Fill out our form below to get a free quote and find out how much you can save with $0 down. 
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