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CPUC Proposes to Reject Anti-Solar Proposals from Utilities

Sacramento CA—The California Public Utilities Commission recently issued a proposed decision in the proceeding to renew the net metering tariff for solar customers. The proposed decision rejects the utility proposals to slash the value of credits for power they receive from solar customers and to impose hefty new fees for solar customers.

“Gov. Brown’s PUC is standing up for clean power and for customers by proposing to reject the utilities’ attempts to make solar out of reach for customers,” said CALSEIA Executive Director Bernadette Del Chiaro.

The proposed decision would maintain net metering with credits valued at a customer’s full retail rate, but would make changes that solar companies have opposed. CALSEIA will work to improve these provisions in the final version of the decision:

  • It would create a new fee for solar customers to collect utility program charges (“non-bypassable charges”) on a larger portion of the bill. CALSEIA proposed starting this fee in 2019 rather than at the beginning of the new tariff.
  • It would mandate that solar customers on the new tariff use rate plans with rates that vary by the time of day beginning in 2018. Mandatory time-of-use rates would make it difficult for some customers to predict their savings, so it is important that the final decision add flexibility for customers.

Utilities have argued throughout this proceeding that maintaining net metering would result in a great expense to non-solar customers, but the Commission finds that such claims have not been proven. Combined with the restructuring of residential rates that is already being phased in, the changes in the proposed decision may result in little to no shifting of utility revenue sources. This question will be re-evaluated in 2019.

“The Commission is rejecting the utilities’ false numbers and clearing the pathway for solar to continue to grow,” said CALSEIA Policy Director Brad Heavner.

The proposed decision establishes a process to revisit the net metering tariff again in 2019, but guarantees that customers who install solar before those changes take effect will not be subject to the further changes.

The proposed decision also proposes an alternative tariff for disadvantaged communities that will create further opportunities for low-income customers to join in the clean energy revolution. Details of the alternative tariff need to be resolved, but it may lead to a workable community solar program for census tracts that have historically been impacted by dirty power plants.

The PD proposes to continue virtual net metering and meter aggregation with full retail credit. It also approves CALSEIA’s proposal to expand market-rate VNEM to allow participation throughout a single apartment complex rather than just on an individual building.

“Although we don’t like everything in the proposed decision, it is a fair compromise that will maintain the opportunity for customers to go solar,” added Heavner. “It is consistent with Gov. Brown’s strong commitment to transforming our energy system into one that is based on clean, local power.”

Net energy metering is a tariff that provides fair compensation to solar consumers for excess electricity they export to the grid. In place since 1995, net energy metering has been a foundational policy enabling growth in customer-adopted solar energy in California and has been similarly important to the growth of rooftop solar in other states throughout the country.

Over the past few years, utilities have incorrectly labeled net energy metering as a subsidy and sought major modifications, with mixed success. Arizona utility SRP made changes to net energy metering last spring that resulted in a 95% drop in customer adoption of rooftop solar within the first month. In contrast, Colorado recently rejected a major utility effort to dismantle net metering and other states continue to increase their caps on the tariff.

California’s investor owned utilities, PG&E, Southern California Edison, and San Diego Gas & Electric, proposed major changes to California’s net energy metering program similar to those adopted by the Salt River Project. Details of those proposals can be found here. The proposed decision will undergo a 30-day comment period with a vote on a final decision likely in January.

Once in place, the changes to net metering, which were put in motion by AB 327 (Perea) in 2013, will only affect consumers who go solar after the 5% cap is reached by each utility. Existing customers will continue under the current net metering rules for twenty years from their installation date. It is anticipated that San Diego Gas & Electric will hit its 5% cap this coming spring, PG&E this coming summer, and Southern California Edison sometime in 2017.


About CALSEIA

Since the 1970s, CALSEIA has advanced the common interests of the California solar industry, helping to make California’s solar customer adoption the most robust in the United States. Comprised of hundreds of California solar contractors, manufacturers, distributors, developers, utilities, engineers, consultants and educational organizations, CALSEIA represents a diverse membership committed to growing the California solar industry. CALSEIA engages with local and state decision makers to ensure California remains a solar energy leader through good public policy and regulations that provide clarity, transparency, and certainty for the state’s growing solar market.