California rooftop solar proposal sparks firestorm

A proposed ruling that would upend California’s rooftop solar industry pits advocates of economic justice against supporters of solar construction and fractures its environmental movement.

The controversial proposal – which has now been postponed ‘until further notice’ – would reduce the incentives homeowners receive to generate their own solar power and charge them to connect to the power grid.

The fight illustrates that battles within the energy transition do not always conform to typical ideological lines and pose difficult questions for advocates of both clean energy expansion and the fight against economic inequality.

The proposal, first unveiled in December by the California Public Utilities Commission (CPUC), would modify its rooftop solar program by revising current “Net Energy Metering” (NEM) rules to “balance the needs of the grid electricity, the environment and consumers,” said a statement from the commission.

The plans were met with far-reaching backlash – including from celebrities like Elon MuskElon Reeve MuskEntrepreneurs protect the economy; governments should invest in them. Canada’s prime minister calls truckers protesting COVID-19 vaccine mandate an ‘occupation’. Why is Putin so confident these days? FOLLOWING and Mark Ruffalo — who fear it will set back the state’s transition to clean energy.

Former Governor Arnold Schwarzenegger (right) wrote a recent New York Times op-ed warning that ‘California is about to take a big step backwards’. Earlier this month, Gov. Gavin NewsomGavin NewsomIs it time to call the encore? Officials point to mask requirement for Super Bowl LA fans, mayor says he held his breath during maskless photo with Magic Johnson MORE (D) told reporters that changes needed to be made to the proposal.

“I don’t think the commission appreciated the firestorm that their proposal was going to unleash,” Ken Cook, president and co-founder of the Environmental Working Group, told The Hill.

This firestorm, he explained, resulted from “the convergence of deep public frustration with large public services” and what they believed to be a disruption of “one of the most successful elements of state energy policy.

The plans are so controversial that the CPUC removed a scheduled vote on the decision from its Jan. 27 meeting agenda. And on Thursday, the commission’s administrative law judge sent an email to a list of designated departments stating that the proposed decision “will not appear on the agenda for the Commission’s voting meeting until new order”.

A commissioner recently reassigned to rulemaking “has requested additional time to analyze the case and consider revisions to the proposed decision based on the parties’ comments,” the email said, noting that the oral hearing will be postponed.

The proposal in question, dubbed NEM 3.0, would reduce the payments solar customers receive when they send the excess electricity they generate back to the grid. Predecessors to NEM 3.0 – introduced in 2013 and revised in 2016 – allowed customers to get a credit on their electricity bills at retail rates, meaning they could essentially offset their monthly energy expenses.

Changes to this approach are needed, according to the proposal, because the money provided to solar home generators is set at a fixed retail rate and is not tied to the actual value of the electricity. Transitions to lower rates for existing customers would occur 15 years after their initial grid connection date.

NEM 3.0 would also require solar customers to pay a “grid participation fee” of $8 per kilowatt — a fee that the CPUC says would serve to “capture a fair share of costs from residential adopters to maintain the grid.” Under the proposal, low-income and tribal households would be exempt from these charges, while a $600 million equity fund would facilitate clean energy adoption in low-income communities.

If the average San Diego rooftop system is around 5 to 6 kilowatts, most customers in that area would pay between $40 and $48 a month, the San Diego Tribune estimated.

The move could sharply reduce solar power in the state. An analysis by Wood Mackenzie found that by 2024, this could halve the state’s residential solar market.

Laura Deehan, state director for the group Environment California, called a similar reduction in Nevada a cautionary tale.

“We’ve seen, very quickly, the adoption of solar energy plummet,” Deehan said. “And I’m very concerned that the same thing will happen if the California Public Utilities Commission adopts something close to what has been proposed.”

Whichever proposal ultimately passes, Deehan said there should be “no solar penalty fees” because such fees would penalize people for meeting state energy goals.

In response to a question from The Hill, Newsom’s office said only that “the governor is deeply committed to advancing our clean energy goals, including helping Californians access a diverse range of renewable energy sources. “.

For proponents of the proposal, however, the current system has inherent disadvantages for low-income electricity users, who end up paying higher tariffs to compensate for the solar subsidy.

These proponents, which include consumer groups and the Natural Resources Defense Council (NRDC), an environmental group, note that low-income residents often cannot afford the upfront costs of solar power and may not be homeowners. of their house, so they can’t install signs.

They also point to the ephemeral nature of solar power: while solar panels provide power while the sun is shining during the day, in the evening these consumers can use the electrons that are on the grid, including those fossil fuels.

“If you charge 30 cents per kilowatt hour, you’re not getting the climate benefits and you’re going to screw up the poor,” said Severin Borenstein, professor of business administration and public policy at the University of California. Berkeley.

“As the sun goes down, the need for another generation increases very rapidly…That’s why we still really need the gas capacity…because we have to be able to meet the demand at those times,” Borenstein said.

He explained that rooftop solar is “particularly inefficient” at the end of the day “because the output from it drops sooner, so we don’t get the benefits of rooftop solar that go shut down these gasworks”.

Deehan argued that rooftop solar has the potential to save everyone money, because when people generate their own electricity, they may not need what’s already there. on the network, which reduces demand.

“Instead, I create my own electricity and share it with my neighbours,” she said. “The utility doesn’t benefit from that, but it essentially negates that request.”

This situation, she conceded, could be a problem “if there was suddenly no use for that extra energy” and so everyone ended up paying more.

But Deehan explained that it’s “just not a problem we’re seeing” because the “demand for electricity is increasing” in California, especially when people buy electric vehicles that need to be charged.

“In fact, it is projected that we will need 150-200% of our current electricity needs,” she said.

The controversy is dividing state environmentalists, as the NRDC supports the proposal while other groups like the Sierra Club and the Environmental Working Group oppose it.

In an explanatory page on its website, the NRDC says the rates paid by the program have not kept pace with changes as solar power has become more widely adopted.

“Current net metering rates were established when solar power was just beginning to take off, at a time when solar power needed to be encouraged due to its high cost of installation,” the page says.

While the grid initially needed more electricity at noon, that need has diminished and retail tariffs have since “doubled or tripled”, according to the group.

“So today, utilities are effectively paying rooftop solar users five times what that energy is worth in California,” he added.

The Sierra Club took issue with the additional fees charged to solar generators to connect to the grid, but is more sympathetic to the argument about overcompensation of solar generators.

The group presented a sort of compromise proposal that would slowly decrease payments for rooftop solar.

Katherine Ramsey, senior counsel for the Sierra Club, said the main difference is that her proposal would tie rate cuts to whether or not rooftop solar was built.

“We’re not really fighting about the long-term vision of this program,” Ramsey said, noting that it’s critical that withdrawals be tied to capacity.

That way, she explained, if the commission ends up cutting offsets too much and blocking rooftop solar panels, the export credit won’t “go down until they catch up.” and that they will actually deploy new rooftop solar systems.”

Cook, of the Environmental Task Force, stressed the importance of democratizing clean electricity generation through policy that puts low-income or working-class families “in the front line” for the adoption of solar energy.

“Let’s ask the Public Utility Commission to start there — not with the approach they’ve taken, which is basically making solar power more expensive for everyone,” Cook said.

Cook stressed that the CPUC must “start from scratch and ask the question, how do we deal with the fact that low-income families are paying too much for electricity and they don’t have access to solar energy ?”

“I don’t think it’s crushing the solar industry on the rooftops,” he added. “It’s exactly upside down. And I think that’s a better starting point.

About Cassondra Durden

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