California slashes rooftop solar export compensation for renters, schools, farms

Roughly a year after cutting rooftop solar payments for single-family homes exporting electricity to the grid, the California Public Utilities Commission (CPUC) has now unanimously voted forward a decision that does the same for multi-meter properties, farms, schools, some commercial buildings, and more. 

Previous to this decision, properties with multiple electric meters in California would be connected via a Virtual Net Energy Metering (VNEM) and Net Energy Metering Aggregation (NEMA) program, which allow properties with multiple meters to install a single solar array for the entire property, sharing one system’s electricity and associated net metering credits with all customers and meters on the property. 

Properties under these programs sell excess solar generation back to the grid in exchange for bill credits. The new decision slashed these payments by roughly 80%, making a severe dent in the value proposition for new rooftop solar customers. 

Additionally, the ruling determined that common areas in residential buildings are no longer eligible for the aggregation feature within VNEM and NEMA, meaning that any solar capacity associated with common area electric meters must be used by that area, and any excess must be sold to the utility at a low rate, and then purchased back at a much higher rate, multiples above what it was sold for. These common areas that cannot be tied to other accounts include hallways, gyms, outdoor areas, EV charging stations, and more. 

“It is astonishing how intent the CPUC is on continuing to block the growth of solar at the expense of consumers and our state clean energy goals for the benefit of big utilities like PG&E.,” said CALSSA Executive Director Bernadette Del Chiaro.

(Read: “California rooftop solar policy struggles serve as warning to nation“)

The CPUC is mandated to serve the public, primarily securing electricity reliability and affordability. This recent decision by CPUC to make it harder for renters to adopt solar in California is particularly confusing given the justification for its previous slash to single-family homes in NEM 3.0. That decision was based on a utility-backed argument that rooftop solar was exacerbating inequality in California, and that renters were being left behind in the savings that solar can bring.

Now, just a year later, CPUC made another move to support that moat around the profits of the major private utilities. What’s more, alongside the net metering decision, CPUC voted to approve a 12.8% hike in electricity rates. The prices continue to rise steadily, even as California electricity rates have far outpaced inflation. 

“There’s no arguing that rent and cost of living in California are high, and solar is a real way to defer those expenses,” said Chris Hopper, chief executive officer, Aurora Solar. “This further eats away at that, and unfortunately, it impacts vulnerable communities who are easily hurt by high costs: renters, farmers, and small businesses. Overall, the change in pricing structures is going to have a much larger impact on low-income communities.”