DON’T EXPECT A DECISION ON SOLAR RULES TO COME SOON
State utilities commission seeking additional input on controversial proposal
The California Public Utilities Commission has formally asked for additional input regarding aspects of a controversial proposal that would dramatically change the rules for the 1.3 million customers in California who have placed rooftop solar panels on their homes and businesses.
The commission, known as the CPUC, has delayed taking a vote on the proposal for months, and the call for more comments figures to push back the likelihood of a final decision to at least July.
Under Net Energy Metering, or NEM, when a rooftop solar system generates more energy than it actually consumes, the excess can be sent back to the electric grid and customers receive credits on their bills.
California’s NEM rules have not been changed since January 2016, and the commission has been working for years on an update, called
NEM 3.0.
In December, a complicated 204page proposed decision was released that — if passed — would significantly alter existing solar regulations.
The revisions include creating a “grid participation charge” of $8 per
kilowatt on the solar systems of residential customers. With typical rooftop installations being 5 to 6 kilowatts, that would come to about $40 to $48 per month.
Another potential change would alter how much solar customers are
paid when they send excess power back to the grid. Instead of being credited at the retail rate of electricity, customers would get paid at the “actual avoided cost,” which is much lower.
The proposed decision has received furious pushback from many rooftop customers protesting the increased costs. Saying the proposal “taxes the sun,” the solar industry predicts the changes will discourage new customers from making the investment in rooftop installations.
On the other side, utilities across the state have long complained that the growing number of installations leaves customers who don’t have rooftop systems paying a greater share of the fixed costs that come with maintaining the electric system — things like wires, substations and transformers. This cost shift, they and some others argue, leads to non-solar customers paying disproportionately more on their monthly utility bills.
About a month after the proposed decision was released, Gov. Gavin Newsom said, “We still have some work to do” on the proposal. And in February, one of the
CPUC’s administrative law judges announced that the proposed decision “will not appear on the Commission’s voting meeting agenda until further notice.”
Since then, the vote has remained on hold.
The call for additional input focuses on three items:
• what a glide path should look like if residential solar customers transition from receiving credits based on retail rates to compensation based on “actual avoided cost.”
• what should be included in solar customers’ “non-bypassable charges” — utility-speak for fees that help pay for programs such as the state’s wildfire fund, nuclear decommissioning and energy assistance programs for low-income households.
• discussion regarding a statewide program designed to help residential customers in disadvantaged areas receive discounts on their monthly bills by taking part in community solar projects.
The CPUC wants comments filed by June 10 and then replies to the comments by June 24, meaning that a subsequent vote is unlikely to be cast until July at the earliest.
Two groups in opposing camps issued statements regarding the call for comments.
“While we support the Commission carefully considering reform options, every single day that goes by without NEM reform imposes more cost burden on non-solar customers,” said Kathy Fairbanks, spokesperson for Affordable Clean Energy for All, a group headed by the state’s investor-owned utilities.
Bernadette Del Chiaro, executive director of the California Solar & Storage Association, said “a solar tax appears to be still on the table” and her group “will continue to make sure no one is fooled again by the utility profit grab that makes electricity more expensive for everyone and halts California’s grid resilience and clean energy progress.”
Under CPUC rules, a proposed decision may be amended before it goes to the five commissioners for a vote. It’s also possible that an “alternate proposed decision” that is significantly different from the original may be put forth.
It takes a majority vote of the commissioners to adopt a proposed decision.