California regulators call for later peak under SDG&E time of use rates

A week before a key ruling and with little justification, CPUC has altered a proposed decision on TOU timing. If approved this will be bad for SDG&E customers who adopt solar and could set a precedent for TOU rate cases at California’s other utilities.

By Christian Roselund, PV Magazine

As a component of modernizing the electric grid, time-of-use rates can be an important way to set price signals to help shift both customer behavior and to incentivize generation that aligns with system needs. However, in areas with high penetrations of solar such rates undermine PV system economics, and erratic behavior by regulators in setting such rates can be problematic.

So when the California Public Utilities Commission (CPUC) modified a proposed decision to adjust the daily schedule for such rates for San Diego Gas & Electric Company (SDG&E) shortly before a key vote, the response by the solar industry was swift.

Both California Solar Energy Industries Association (CALSEIA) and Vote Solar have expressed criticism of the move, which would move the peak period from 4 to 9 PM, instead of 3 to 9 PM as the commission stated in April, with Vote Solar calling it a “regulatory about-face” that “undermines California’s clean energy and climate leadership”.

Both organizations note a lack of justification for the change in timing. In the modified decision, CPUC notes that the the record can support either a 3 PM or 4 PM start to the on-peak period, but notes that for un-named “policy reasons” it is choosing 4 PM.

And while CPUC claims that a shorter peak period is easier for customers to navigate, it is not showing as much concern for the degree of continuity. For 30 years, SDG&E’s peak period has been 11 AM to 6 PM, and by moving the start of the on-peak period from 3 to 4 PM, CPUC is making the shift more dramatic than before.

This is exactly the sort of thing that the solar industry has warned against. In a recent interview with pv magazine, CALSEIA Executive Director Bernadette Del Chiaro has expressed that more gentle transitions are in the best interests of both the solar market and consumers.

However, it is in line with the interests of utilities, who have continually pushed for later on-peak periods. CALSEIA warns that this could have effects beyond the San Diego solar market in cases for California’s two other investor-owned utilities, who are setting mandatory TOU rates for residential customers who own PV systems under net metering 2.0.

“This is precedent-setting for the other rate cases,” warns CALSEIA Senior Policy Advisor Kelly Knutsen.

This proposed decision is not the final word, and as such the solar industry will be pushing back against this proposed decision. However there is not much time, as a ruling is expected on this case August 10.


California judge backs blocking utility’s TOU rates plan

Southern California Edison’s plans to move customers to time-of-use rates in 2018 have hit a snag as Administrative Law Judge Sophia J. Park has recommended to the PUC that it delay their implementation. A final decision could come Aug. 24.

By Frank Andorka, PV Magazine

Southern California Edison’s (SCE) plans to apply default time-of-use (TOU) rates on its customers starting Jan. 1 may have hit a snag as Administrative Law Judge Sophia J. Park has recommended to the Public Utilities Commission (CPUC) to dismiss the utility’s application.

In her recommendation, Park says SCE’s request for an expedited rollout of default TOU rates wouldn’t allow enough time for the PUC to evaluate the effects on ratepayers from pilot programs currently under way.

TOUs became mandatory for solar users under earlier rulings of the CPUC, and they began for SCE customers on July 1 as part of Net Metering 2.0. The California Solar Energy Industries Association (CALSEIA) has been pushing for a gradual implementation of TOU rates, and this decision could signal that regulators are pushing back against the utilities on the speed of TOU adoption.

“There is not really a big question that this is where the state is headed,” said CALSEIA Executive Director Bernadette del Chiaro in a July 13 interview with pv magazine during Intersolar North America. “What remains to be seen is what the differential is, and the price differential between peak and non-peak, and how dramatic in the early stages that is. We hope that the PUC understands – and regulators – understand that this needs to be a gentle transition.”

For her part, Administrative Law Judge Park cites the 2015 decision by the CPUC requiring all investor-owned utilities (IOU), include SCE, to submit plans for going to default TOU rates by Jan. 1, 2018, for implementation in 2019 after approval. In that decision, the CPUC required pilot programs for opt-in TOU rates, to be followed by default TOU rate pilots.

SCE is asking for an expedited rollout to accommodate an upgrading of its customer service software platform, which it says would delay the transition of its customers to TOU rates until the the third quarter of 2020. SCE proposed doing the rollout of its default TOU rates in two waves, with the first wave occurring in the fourth quarter of 2018 and affecting 1.6 million customers.

“Accelerating the timeline for residential default TOU would not allow sufficient time for completion of the implementation steps required by the [CPUC] prior to the rollout of default TOU,” Park wrote. “Moreover, in order to have sufficient time to implement Wave 1, SCE requests an expedited procedural schedule for its application with a final Commission decision by November 2017. Such a compressed timeline would not give sufficient opportunity for the Commission or stakeholders to give due consideration to the various issues raised in the application and protests.”

Under the original CPUC decision, the first report on the opt-in TOU pilots – which began in June 2016 – was delivered in April. A second interim report is due in November, and a final report is expected to be issued at the end of the first quarter of 2018. Meanwhile, the pilots of default TOUs aren’t even scheduled to begin until March 2018, with the initial results to be reported next fall. The second set of results covering March 2018 through March 2019 is expected to be issued in the summer of 2019.

The CPUC will consider Park’s recommendations at its Aug. 24 business meeting.


California Moving Too Slowly On Customer-Sited Energy Storage

By Laura Gray, Solar Industry Magazine


It may surprise many around the country that California would reject a bill in the legislature to give long-term certainty to the energy storage market and to repeat the successes the state has had with solar. However, the Assembly Utilities and Energy Committee quietly killed a bill last week that would have created a program similar to the California Solar Initiative for customer-sited energy storage.

The storage businesses in the state would have had the opportunity to double-down on their investments and create more jobs and energy independence across the state. The bill, S.B.700, would have provided the runway that California businesses need to bring down storage prices and to eliminate the fits and starts that characterize the current market. Under pressure from utilities, the bill was tabled until next year without even a vote. Utilities see customer-sited storage as the next frontier in massive grid defection. But as we move toward electrification, storage is just another tool for consumers to control their energy use and to integrate more renewables on the grid.

The bill would have created up to a $1.4 billion extension to the current Self-Generation Incentive Program (SGIP) and would have given the industry long-term certainty to invest in storage in the state. The bill would have created a 10-year rebate program that declined in steps to zero, forcing businesses to bring down prices over time and get the industry off rebates.

The bill had passed the state Senate and was up for a vote in the Assembly Utilities and Energy Committee when it was pulled from the agenda. The unexpected coalition of supporters of nearly 100 businesses, environmental justice groups, trade associations low-income and housing advocates, state environmental groups and workforce development advocates all see the benefits of customer-sited storage, and we were pushing hard for a bill many thought wouldn’t even see the light of day after the first committee. Under the leadership of the bill’s author, State Sen. Scott Wiener, D-San Francisco, the bill gained momentum and was headed for a vote in committee when it was pulled from the agenda. Although many thought of this as a big lift and a “two-year bill,” our unique coalition nearly got the bill through in one year.


Bernadette Del Chiaro, executive director of CALSEIA, led a social media campaign during Intersolar North America’s opening ceremony last week as a final push before the legislative committee decided to let the energy storage bill die. Attendees held up pieces of paper saying, “Pass SB 700.”


SGIP has sparked a nascent industry of nearly 200 developers, installers, and manufacturers competing in this new space. These fledgling businesses need a longer runway to invest in technologies and practices that will bring prices down so that state rebates are no longer needed. Energy storage is key to our clean energy future, and the state should support the industry it has already created so that the benefits are felt across California.

The biggest benefit to customer-sited storage? Private investment is fueling the bulk of the industry. Ratepayers pay a small fee that provides rebates to storage projects, and the rest of the cost is shouldered by investors and customers. Private investment is fueling this distributed solution to our ramping and curtailment issues, allowing for more renewables on the grid and providing grid benefits, which saves money on expensive infrastructure upgrades. Ratepayers that don’t have storage on their homes or businesses benefit from the private investment made by customers who choose to invest in storage. Moreover, ratepayer investment, combined with declining rebates, will bring down the prices of storage overall, making the technology more affordable.

California is a leader in storage. But the state has much more work to do to become the international storage market leader that it is for solar and other clean energy firsts. Storage on the customer side of the meter can also provide unique ancillary grid benefits while managing demand-side load that can defer expensive transmission and distribution upgrades. If we do that all through utility procurement, we lose a competitive market and we put ratepayers on the hook to pay for big utility projects. Let me be clear: We need utility-scale storage to manage supply-side issues, among other important reasons. But we also need distributed resources to manage demand-side issues.

Californians want storage, and they are ready for it.

Laura Gray is the energy storage policy advisor at the California Solar Energy Industries Association. Gray also authored a broader article, titled “Massive Storage Development Needed In California,” in Solar Industry‘s July 2017 issue.



California energy storage incentive bill dies in committee

A last-ditch effort to pass SB 700 and create a long-term energy storage subsidy in California has failed, leaving the state without a plan for one portion of what it needs to meet increasingly ambitious renewable energy targets.

By Christian Roselund, PV Magazine

Among the states pushing the boundaries of the Energy Transition in the United States, California can make a strong case for being the leader. The state’s 50% by 2030 renewable energy mandate is not as ambitious as targets in Vermont and Hawaii, but given the sheer economic and geographic scale of the state, it is resulting in far more wind turbines and solar panels.

California gets the highest portion of electricity from solar of any state in the nation, but is already experiencing problems with negative pricing and curtailment, due to factors including high PV production during daytime hours and the 24/7 import of electricity and running of hydroelectric and nuclear power, even during periods of curtailment.

As a reaction to these realities, California has subjected all utility customers who participate in the state’s new Net Metering 2.0 policy to time-of-use rates, which are expected to increasingly weaken the economics of customer-sited solar.

The obvious answer to these circumstances, both at the macro level and the level of individual electricity customers, is energy storage. There’s just one problem: the economics of battery storage systems don’t yet pencil out, at least for residential customers. And while battery prices are falling from year-to-year, even a modest battery system can double the cost of a residential solar installation, well overwhelming any savings derived from time-of-use arbitrage under current rate proposals.

This week hopes for a long-term program to bridge the gap while energy storage costs fall were thwarted, at least temporarily. SB 700 aimed to create a system of incentives for energy to continue after the current funding dedicated to the Self Generation Incentive Program (SGIP) dries up, which could happen by the end of this year.

However, the bill failed to pass through the California Assembly Committee on Utilities and Energy, and after missing a deadline will not be considered. “It had a lot of opposition from the utilities, which would prefer to install and own all the storage themselves,” California Solar Energy Industries Association (CALSEIA) Executive Director Bernadette Del Chiaro told pv magazine.

This is despite an aggressive campaign by CALSEIA, which included an impromptu social media audience engagement exercise at the opening of the Intersolar North America trade show.

However, Del Chiaro says that while the bill may have been killed, that this is not the end. “The vehicle that is this piece of paper that has been called SB 700 has been stopped, but this broad coalition that we have built had not been stopped,” states Del Chiaro. She also notes that a bill to move California to a 100% renewable energy mandate is moving forward.

However, the devil may end up being in the details, as California will not be able to get anywhere near such an ambitious targets without massive deployment of batteries. “You need storage to do that,” says Del Chiaro, referring to the proposed 100% renewable energy target. “We just couldn’t get this committee to fully engage. Yet.”