“The CPUC's final proposal is a loser for California on many levels. The proposal is a step backwards when we really need to be moving forward with solar and battery storage. It is a dark day in California when the utility regulators try to block out the sun.”
Sacramento, CA—The California Public Utilities Commission (CPUC) released a final proposed decision today on solar net energy metering, which the CPUC commissioners are expected to vote on December 15.
Based on an initial analysis by solar advocates, the final proposed decision would significantly reduce California’s solar market. The final proposed decision maintains a 75 percent decline in the value of solar energy, effective April 2023.
The final proposed decision also does not do enough to advance energy storage as it elongates the payback periods for these combined systems beyond what they are today. Today, California is installing roughly 30,000 batteries compared to 200,000 solar systems. With high costs, supply chain constraints, inflation and permitting and interconnection delays and challenges, it will take years before the storage market can match the solar market.
While the revisions to the proposal preserve the current value of solar energy for multi-family housing and farms until further analysis can be done, those minor modifications alone will not protect California’s overall solar market.
Overall, the final proposal fails to provide a sensible glidepath on lowering solar export rates while maintaining the growth of energy storage for both the residential and commercial markets. The result is an expected cliff in the growth of new solar installations and the expansion of battery storage capacity, according to solar advocates and industry experts.
Bernadette Del Chiaro, executive director of the California Solar & Storage Association (CALSSA) issued the following statement on the CPUC’s proposed decision:
The CPUC's final proposal is a loser for California on many levels. 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. For our grid reliability needs, it fails to promise robust growth in battery storage. And for California's race to clean energy, it puts us behind our goals and out of step with the national pro-solar agenda. The proposal is a step backwards when we really need to be moving forward with solar and battery storage. It is a dark day in California when the utility regulators try to block out the sun.
Background:
Currently 1.5 million consumers use net metering, including thousands of public schools, churches, farms, and affordable housing developments, and it is the main driver of California’s world-renowned rooftop solar market. As a result of net metering, working and middle class neighborhoods are just under half of the rooftop solar market and the fastest growing segment today.
In total, distributed solar energy systems have added 13 gigawatts of solar energy to the state, roughly the size of six Diablo Canyon nuclear power plants. In addition, consumers have added nearly 1 gigawatt of energy storage which played a meaningful role in keeping the lights on during recent heat waves.
Big utilities want to change the rules in their favor in order to eliminate a growing competitor, keep consumers stuck in utility monopolies, and protect their profits. Utilities claim solar makes the energy bills of non-solar customers more expensive. But in reality, utility profits, infrastructure investment, transmission lines, and paying for their bad planning and the fires they cause are what drives energy rates up. Californians are not fooled, and real equity champions know energy fairness is about “making rooftop solar panels and batteries more—not less—affordable for working families and lower-income Californians.”
A proposed decision released in December 2021, that would have implemented an unprecedented solar tax and drastic net metering credit reductions, was shelved earlier this year after intense backlash and public disapproval from Governor Newsom. Despite that backlash and the overwhelming popularity of rooftop solar in California, the CPUC’s current proposed decision still includes an immediate and drastic slash to the value of net metering.
With rooftop solar’s vital contribution to reaching California’s clean energy goals, the promise of battery storage for grid reliability, and new federal incentives for going solar, a diverse coalition of solar supporters are calling on the California leaders to keep solar growing and affordable for all types of consumers. More than 160,000 people submitted comments to the CPUC and Governor Newsom calling for a strong NEM-3 decision, the highest count in CPUC history.