After a unanimous vote today by the CPUC, homeowners get smaller payments from utilities, which solar companies say will slow construction of new rooftop solar projects. But new state incentives will be available.
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The California Public Utilities Commission today overhauled the state’s rooftop solar regulations, reducing payments to homeowners for excess power but providing nearly a billion dollars in incentives to encourage more solar projects for low-income homes.
Commissioners called the new rules — adopted unanimously after hours of highly charged public comments that were almost entirely opposed — a much-needed course-correction to California’s 27-year-old residential solar rules.
Both the power companies and the solar industry criticized the new rules that outline details of the financial incentives to encourage people to build rooftop solar. Utilities did not get all the concessions they hoped for to lower bills for non-solar customers. And solar developers say the rules will discourage people from installing solar panels.
A victory for the solar industry came earlier this year, when the commission dropped an unpopular plan to charge homeowners an 8% per kilowatt-hour tax for new solar systems.
In remarks before the vote, commissioners acknowledged how divisive the matter has been. Commissioner John Reynolds said the decision was a “heavy one,” saying “nothing in energy policy is black and white, and nothing in this decision has been.”
Commissioner Clifford Rechtschaffen said the agency faced “competing and challenging priorities.” He called it a “responsible and forward-looking decision.”
The new regulations will:
California’s original rules, called Net Metering, were implemented in 1995. They established a framework for utilities to buy excess solar energy from homeowners and supplement power to the grid.
The overhaul comes as California needs to lean more heavily on renewable energy to meet state targets to produce zero-carbon electricity by 2045 and end use of fossil fuels.
About 1.5 million rooftop solar systems are installed on California’s houses, schools and small businesses. About 14% of California’s total electricity comes from large-scale solar projects; another 10% of the state’s power comes from rooftop residential solar.
Solar companies and environmental groups say the policy could undermine the state’s booming solar industry by raising the costs of operating panels on homes and small businesses. They say that in states where similar rate shifts have been adopted, solar system installation has plummeted.
Bernadette Del Chiaro, executive director of the California Solar & Storage Association, called the decision a backward step.
“The CPUC’s final proposal is a loser for California on many levels,” she said in a statement. “For the solar industry, it will result in business closures and the loss of green jobs. For middle class and working class neighborhoods where solar is growing fastest, it puts clean energy further out of reach.”
Woody Hastings, The Climate Center’s energy program manager, said “California needs more solar power — not less.”
“Just as more middle and lower-income Californians are putting solar panels on their rooftops, the new rules adopted by the CPUC today threaten to slow the growth of clean energy across the state,” he said.
The years-long fight was played out across social media and opinion pages. The complex process of revising the rules elicited tens of thousands of public comments and was, at one point, arbitrated by Gov. Gavin Newsom.
The CPUC’s scaled-back plan eliminates consumer fees. The original was abandoned after criticism from the governor and solar advocates that it could hurt the transition to renewable energy.
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