California

2009 Activities

For distributed generation, the California Solar Incentive program is in place and working well (the lifting of the $2,000 cap for the federal ITC for residential installs will be a significant boost). The problem is that the state is in danger of bumping into the cap on net metering (currently 2.5% of total peak demand). Assemblymember Skinner sponsored legislation (AB 560) to deal with this problem. Despite widespread support for the bill, the 2009 legislative session timed without raising the net metering cap. We're gearing to help get net metering back on track.

For wholesale solar power, there are an impressive list of opportunities underway. In 2008, we began an effort to address a policy gap for solar systems in the 1 to 20 MW range, by establishing a standard offer contract program to buy wholesale solar energy inside of distribution networks. Our first filings at the CPUC can be found here, next round of filings here. We will be supporting legislation in the 2009 session as well.

All major utilities in California have proposed major distributed generation PV programs. We will continue to engage to make sure opportunities are mazimized (in this vein).

We will support efforts to expand the state's RPS to 33%.

Transmission is a key issue. With the lawfirm of Keyes and Fox, we have intervened in R.08-03-010 before the CPUC, with the goal of ensuring that the transmission necessary to bring large-scale solar generation to load centers is done in a way to maximize conservation values and minimize impact.

2008 Updates

Governor Schwarzenegger signed a suite of pro-solar bills this year. Highlights include:

AB 1451 (Leno): Extends the current properrty tax exemption to 2016, and provides clarifications to make it useful for new construction. Drops the price of utility-scale solar about a penny/kWh, and generally makes everything we are trying to do with energy in the state, from AB 32 to the California Solar Initiative to the Renewable Portfolio Standard, cheaper and easier. Click here for more (pdf).
AB 2768 (Levine): Removes the requirement for time of use rates from SB1, allowing people to maximize the value of their solar systems.
AB 2466 (Laird): Allows for aggregate account net energy metering for local governments. Will turbocharge municipal solar efforts.
SB 1754 (Kehoe) authorizes the California Alternative Energy and Advanced Transportation Financing Authority to enter into renewable power purchase agreements.
AB 2863 (Leno) Helps clarify some issues and establishes consumer protection for residential solar power purchase agreements.

Some of the most important activity is on the regulatory front. The CPUC has opened a docket to consider the expansion of standard offer contracts. See our initial joint comments here, and for context, the full docket here.

We've written an article on this effort; find it here.

2007 Updates

On June 7, 2007 Governor Schwarzenegger signed urgency legislation to fix problematic language in SB1 that required all new solar customers to take Time-of-Use (TOU) energy rates in order to receive a solar incentive. This was causing a slowdown in solar interest, because the TOU rates were causing some customers bills to go up, even with solar. We successfully convinced the Governor’s office and some key legislators (Lloyd Levine and Christine Kehoe) that this was a problem, and they quickly passed legislation fixing the problem. It’s good to have folks in Sacramento on our side.

There are other transition issues that we are working to resolve with the new CSI program. Paperwork requirements and inspection delays have further hampered the success of the solar program and we are working to resolve these and other problems with a strong coalition of supports, including the solar community as well as the utilities themselves.

We recently settled the PG&E general rate case (GRC) and are happy to report that we succeeded in agreeing on a much improved residential time-of-use tariff that will greatly stimulate solar installations in PG&E territory (not to be confused with the bill referred to above, TOU rates can be good for solar, but requiring them is bad policy and bad for the market). The PG&E E-6 tariff is much like the old E-7 tariff that solar installers were very happy with, but that was closed to new customers in May, 2006. The new E-6 tariff is almost as good for solar customers as the old E-7 was. In addition, by participating in the GRC, we were able to maintain the commercial A-6 tariff as the states best commercial solar tariff.

2007 Legislative Session was a mixed bag for solar. AB 1470, a landmark solar hot water heating bill, passed on the last day of session. SB 1036, which provided critical changes to the state's Renewable Portfolio Standard, also passed. AB 1451, which would have extended the state's property tax exemption for solar, was held up in committee and held over to January 2008 for further action.

Background

On August 21, 2006, Governor Schwarzenegger signed Senate Bill 1 into law, creating a $3.35B solar program to install 3,000MW of solar photovoltaic systems and bring solar energy into the mainstream. In addition SB1 raised the net metering cap, which was absolutely necessary to meet the state's 3000MW goal. This capped 4 years of effort by the solar community to pass this legislation and formally codified the California Public Utilities Commission's California Solar Initiative.

The state will provide incentives for new construction, residential, commercial and municipal solar installations. More information about the states solar programs can be found on the official website, Go Solar California

This is the biggest solar program in the country.

Vote Solar has completed an analysis of the benefits of the California Solar Initiative that shows:

Policy Needs

The California Public Utilities Commission is now developing the rules for the program through a series of public workshops and regulatory filings. This is an extremely important activity, as it will define the rules for the next ten years. Vote Solar has been actively participating in the process, and has filed many comments jointly with the California Solar Energies Association (CalSEIA) and PVNow (the PV manufacturers association). One of our first joint filings made recommendations for the program structure that were largely adopted by the public utilities commission, if you want to get into the nitty gritty of what we are advocating for at the PUC do, read the filing (PDF).

Finally, there are important rate design issues that must be changed in California. Rate design can make all the difference between a thriving solar market and a failing one. As solar incentives decline, electricity tariffs become the most significant factor effecting solar investment. Until recently California only had one good example of a "solar friendly" commercial tariff — Pacific Gas & Electric's A-6 tariff. With time-of-use rates and no demand charges, it allows solar system owners to fairly enjoy the economic benefit of the electricity they produce. The tariff has played a role in making PG&E the largest solar market in the country.

Vote Solar intervened in the Southern California Edison general rate case in late 2005 and advocated for the creation of a solar friendly commercial tariff. After filing testimony and negotiating with SCE, we settled on a new tariff option that increased the value of solar energy to SCE commercial customers by 30-40%. Vote Solar gave a presentation on this victory at Solar Power 2006 in San Jose, check out the presentation here.

Next Steps

SB1 also created a requirement that municipal utilities in California play a role in meeting the state's 3000MW target. Vote Solar is actively working to ensure that the municipal utilities develop and implement solar programs and meet their statutory requirements. If you want to help make sure municipal utilities create viable solar programs, email gwen@votesolar.org

Vote Solar is now intervening in the San Diego Gas and Electric general rate case to ensure that SDG&E offers a solar friendly tariff for it's commercial and residential customers as well. Stay tuned.

Updated 9/17/07