California AB 1104 is expected to lower the administrative burden on small businesses that move forward with installing solar.
California legislators voted 6-0 to advance AB 1104, Small Business Renewable Energy Access and Protection Act. If passed, the bill will make amendments to Sections 769.2 and 2868 of the state’s Public Utilities Code, lifting certain requirements on small business owners who invest in solar energy.
The amendment changes how nonresidential solar projects under 1 MW are classified under public works laws. AB 1104 ensures that these solar projects are not classified as “awarding bodies” under the state’s labor code.
“Awarding body” project owners are required to register with the Department of Industrial Relations (DIR), register their solar project with the DIR, and be liable for their contractors’ compliance with public works requirements.
“Current requirements—which were designed for large projects with public sector entities—are too complex and time-consuming for businesses, especially smaller ones, to practicably navigate,” said the California Solar and Storage Association (CALSSA) “As a result, many businesses that invested in project development abandon their plans when they are confronted with the prospect of being responsible for the contractor’s submittal of certified payroll records and other public works requirements.”
The law retains wage and apprenticeship standards for nonresidential solar projects under 1 MW while protecting small businesses from public works liabilities.
Current law also pushes Net Energy Metering (NEM) 1.0 and 2.0 customers onto the less lucrative NEM 3.0 “net billing tariff” if their contractor is found to make prevailing wage violations. AB 1104 revises this, enabling solar owners to remain on their current NEM 1.0 or 2.0 rate structure even if a violation occurs, removing liability for small businesses.
AB 1104 also expands the definition of “independent solar energy producer,” which CALSSA said allows more business-to-business solar transactions to occur without adding public utility requirements.
