California community solar bill would lower costs for all with no cost-shift

California is a long-time leader in solar energy, yet the state has never been able to establish a viable community solar program. The California Public Utilities Commission’s (CPUC) existing program design left few projects viable under its rules. However, a recently introduced bill, Assembly Bill 1260, promises to create a workable program that brings solar to millions of California ratepayers.

A study by Aurora Energy Research, a provider of power analytics, and commissioned by the Coalition for Community Solar Access, found that if passed, AB 1260 can bring multiple benefits to Californian households. Not only would it reduce peak demand, for example, but expensive infrastructure buildout could be avoided while ratepayers save on electric costs.

(Read “California’s new community solar program still isn’t working“)

The Aurora study finds that, as a result of AB 1260, all ratepayers would see lower energy costs with no cost shift for non-subscribers to community solar.

Community solar allows ratepayers to subscribe to local solar projects and receive credits on their electricity bills. The model is especially beneficial to those who don’t own their own homes or who may not  be able to afford the up-front costs of putting solar on their roof.

The analysis shows that deployment of 5.4 GW of local, community-scale solar and storage across California through 2045 would:

• Generate an estimated $6.5 billion in electricity system cost savings that extend beyond project subscribers, as all Californians share net savings through lower system-wide costs and increased grid resilience;
• Reduce electricity prices by $4.2 billion—bypassing transmission constraints and displacing gas generation;
• Reduce statewide capacity required for Resource Adequacy (RA), finding that community solar-plus-storage results in saving $4.6 billion on associated costs required for RA;
• Avoid $910 million in future infrastructure upgrades by using the existing distribution system;
• Lower bills by 10% to 20% for community solar subscribers, especially renters and low-income families;
• Reduce reliance on imported power by 13%; and
• Cut in-state gas generation by 2.5%.

One of the important ways that community solar-plus-storage reduces costs, the study finds, is by lowering spending on RA. This is accomplished by supplying electricity during the evening peak hours and lowering spending on electricity transmission and distribution.

“Community Solar represents a meaningful step in addressing the energy trilemma in California,” said George Prassas, head of USA West at Aurora Energy Research. “Our analysis shows it can deliver lower costs, greater grid reliability and improved environmental outcomes for consumers statewide.”

California has some of the highest electricity rates in the country. According to EnergySage, the average electric rates in California are $0.33 per kWh. AB 1260 intends to lower costs for ratepayers as the bill requires community solar projects to deliver guaranteed bill savings to subscribers, with at least 51% of capacity dedicated to low-income customers.

The study found that community solar projects allow the California electricity system to be 13% less reliant on importing out-of-state electricity and 2.5% less reliant on gas generation.

“This study proves that community solar provides real benefits to California households without raising costs for all ratepayers,” said Derek Chernow, Western director for CCSA. “Community solar reduces congestion, displaces costly gas generation, and makes the entire system more efficient. Everyone benefits—including those who don’t subscribe.”

The findings come as lawmakers prepare to vote on AB 1260, authored by Assemblymember Chris Ward (D–San Diego).

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