The California Air Resources Board identified rooftop solar as a key to California’s carbon neutrality, but proposed legislation slashes rooftop solar value in the state.
Regulators from the California Air Resources Board (CARB) released a comprehensive report outlining the state’s path to carbon neutrality, and chief among the recommendations was support for solar, specifically rooftop solar. However, regulators from the California Public Utilities Commission (CPUC) have been developing policies that are set to slash the value of rooftop solar in the state.
California’s rooftop solar industry represents over 1.4 million homes, small businesses, and other structures topped with PV. The state accounts for 50% of rooftop solar installations in the United States, and of the 230,000 people employed in the solar industry, as many as 68,000 jobs are supported by the state’s rooftop solar business.
Based on California’s clean energy goals, as much as 28.5 GW of rooftop solar needs to be installed through 2045, according to Environment California. If all this capacity were instead installed on land, 148,000 acres would be needed to support it, an area about half the size of Los Angeles.
However, current policies under development in the state, namely the Net Energy Metering (NEM) 3.0 policy, are set to lower the value of solar in the state. The original proposal of NEM 3.0, supported by California’s three large investor-owned utilities was considered an outright disaster for those who supported the buildout of rooftop solar in the state. The proposal was delayed for a couple months after thousands of Californians took to the streets to protest the decision, which was labeled as a “tax on the sun.”
Now, NEM 3.0 is revisited, and it appears the policy still involves plans to reduce the value of rooftop solar, going in direct contrast to CARB’s clean air recommendations. The revised NEM tapers down the value for homeowners’ excess solar generation, using a “glide path” over four years to bring net metering values to the “avoided cost” for the utility, a fraction of what the utility charges for electricity.
It also introduced “non-bypassable charges,” which would add $0.05/kWh to a customer’s bill, whether or not they own solar. These charges would apply to the electrons generated by the customer’s rooftop solar array and delivered to their own homes. Regulations make it very difficult, or even illegal, to disconnect from the grid entirely in many areas in California.
This means that even if the customer completely self-consumes solar energy and doesn’t use utility-generated power, the utility will profit from the homeowner’s system via non-bypassable charges.
“Gov. Newsom should listen to the state’s top clean air officials, not the utility-captured electricity regulators, and use his authority to protect the state’s rooftop solar program,” said Environmental Working Group president Ken Cook.
“It is imperative the governor reject the plot by utilities to undermine one of the main pillars of CARB’s roadmap to ensure renewable energy is the dominate source of electricity in the state. Anything less would send a clear signal that felonious, corrupt companies like PG&E can decelerate California’s progress in addressing the climate crisis,” he said.
CPUC is continuing to take comments on the new proposals in the revised NEM 3.0 until June 10.
