Seeking to cap what they say is a $3 billion cost shift due to rooftop solar, California’s three investor-owned utilities offered a plan to reform the state’s net metering rules, which regulators are slated to take up later this year.
Pacific Gas and Electric, San Diego Gas & Electric, and Southern California Edison together proposed a plan to the state’s Public Utilities Commission (PUC), which set a March 15 deadline for proposals to revise net metering rules.
The utilities’ plan would address what they said is “an unfair and growing inequity” stemming from earlier versions of the rooftop solar Net Energy Metering program. They said the cost shift leads to electricity customers without solar systems paying about $3 billion more annually to “subsidize” existing rooftop solar customers.
The utilities claimed the alleged subsidy represents the costs of the electric grid that solar customers use, “but for which they do not pay.”
The California Solar and Storage Association’s proposal included measures to increase the amount of solar+storage.
Solar advocates filed their own proposals with the commission, and said the utilities’ plan would hurt the industry’s growth. “The real issue at hand isn’t so much a ‘cost-shift’ as the utilities claim but a ‘power shift’ from utility to consumers and small businesses” who install solar, said a statement from the Save Solar Campaign, which includes the California Solar and Storage Association and the Solar Rights Alliance.
California’s net metering system was set up in 1995, when the state counted about 10,000 home-based solar systems. In 2016, regulators approved what has been called NEM 2.0. At the time, regulators kept credits tied to retail rates rather than the lower wholesale rates.
The California Solar and Storage Association’s proposal to the CPUC included measures to increase the amount of solar+storage. And the group objected to two utility proposals. One would be a new Distributed Generation Successor Tariff that would cost about $24 a month. The second was a proposed Residential Grid Benefits Charge that would cost around $11 per kilowatt for a solar system.
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Are the utilities pricing in the grid value of solar? See K. R. Rabago:
The Value of Solar Tariff: Net Metering 2.0
The ‘Value Of Solar’ Rate: Designing an Improved Residential Solar Tariff
No. They are pricing in how much money they are losing by not being able to make money off other people’s rooftop investments. Basically, more utility BS about solar installs.
How utilities will lie!! Rooftop solar net metering lowers the price because it displaces the most polluting generation.
And as the FF must take contracts die off, there is a lot more headroom for solar to help.
And this will only drive cities, micro grids, etc to leave the utilities faster and more profitably.
When one gouges it just makes them a more lucrative target as more money to be made replacing them and at Cal power rates, they are a juicy targets.
Do the residential utility rates for the three utilities in this article include demand (kW) charges? Most utilities do not include demand charges for residential customers they only charge for energy (kWh). The demand charges are paying for the wire to the customer’s home, the transformer to transformer the voltage to 120 V, the distribution line to get the power to the neighborhood, the substation (including substation transformers, metalclad switchgear, etc.), as well as the transmission system, with bulk substations, to get the power from the generation plants to the customer.
If the residential customer is generating all of their own electricity they are only covering the kWh charge from the utility and their bill is effectively zero. I would agree there should be no additional charge to the customer if they were to disconnect from the grid and decide not to have power at night or on cloudy, rainy, stormy days. If they do not pay for their fair share of the transmission and distribution system than they are transferring those costs to all other customers who do not have solar and prices will go up.
Carl – We (solar owners) do pay for our fair share of the transmission and distribution system – it is a surcharge on our bill every month. It’s funny how the state pushes solar (or anything for that matter) to be green and then when enough people have it, they try and add charges to us – because they can.
I’d like to know what we can do about attempts like this. It would be nice for articles to somehow mention which politicians would benefit from being inundated with citizens about the issue.