California Public Utilities Commission Crushes Community Solar With Latest Monopolistic Play

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California has seen massive growth across its solar power sector — utility-scale solar, commercial solar, and residential solar have all boomed in the past decade plus. However, the utilities have been on a mission to squeeze out the little guys (distributed solar energy) for years, and after achieving quite a success on the residential side with Net Metering 3.0, they have moved on to limiting growth of community solar — via their essentially captured regulatory commission, the California Public Utilities Commission (CPUC).

Last week, the CPUC “voted to approve its proposed decision that crushes any chance of a scalable community solar program succeeding in California,” the Solar Energy Industries Association (SEIA) writes.

“Today the CPUC is doing the bidding of monopoly utilities to block a functional community solar program in California. This decision effectively shuts out the vast majority of low-income Californians, renters, and others that can’t install solar directly on their homes from participating in the clean energy economy,” Stephanie Doyle, California State Affairs Director for SEIA, stated.

“Today’s vote ignores calls from the solar industry, environmental justice organizations, customer advocates, and labor groups to create a workable program. It also puts into question the status of federal Solar for All funding, which is solely dedicated to expanding solar accessibility. This is a shocking decision from a Commission that is charged with protecting ratepayers and keeping electricity bills affordable.

I noted above that California has seen massive growth across the solar power sector. However, it has actually not been a leader in the community solar realm. It has installed just 163 MW of community solar, far less than the 2,000 MW installed in New York or even the 1,100 MW installed in little old Massachusetts. California had a chance to finally catch up and make significant progress on community solar with a recent vote from the CPUC, but they decided instead to include strict requirements that will limit new projects and growth, requiring, for example, that the costs not exceed the costs of electricity the utility could get from another source. That takes away the potential for less affluent residents of apartment buildings to participate in the solar energy revolution, as smaller-scale solar is simply not as cheap as utility-scale solar or wind only taking generation costs into account (and ignoring transmission and grid infrastructure costs).

Let’s rewind a bit, though. “The Community Renewable Energy Act (AB 2316) was sponsored by the Coalition for Community Solar Access (CCSA), and supported by the Solar Industries Energy Association, GRID Alternatives, Vote Solar, the Sierra Club, and more. However, the CPUC opposed the bill,” pv magazine writes. “The CPUC asserted in its proposed decision that the Net Value Billing Tariff (NVBT) outlined in the Community Renewable Energy Act “conflicts with federal law and does not meet the requirements” of the bill, which CCSA has noted is erroneous.

“In comments filed in March by CCSA, it characterized the original proposed decision as misguided and misinformed, and determined it will not result in the development of community solar projects as envisioned by the legislature with the enactment of AB 2316.

“Now the CPUC has revised its proposed decision and in it concedes that it needs guidance as to what a successful community solar program looks like.”

As it has been approved by the CPUC, the program relies on subsidies from the EPA’s Solar for All program. Whereas, advocates want it to rely on the private market in order to make it sustainable and more fruitful.

Also, the program is lacking various critical details and guidance — “the revised proposed decision gives no details such as a method for dispersing external funding to the projects and participating customers, reporting requirements, the process for participating, eligible tariffs, cost recovery mechanisms, and more.”

It sounds like the CPUC was forced to move forward with something, but then gave it a half-hearted attempt with various flaws that would cripple California community solar in its crib.

“The CPUC’s decision primarily benefits the financial interests of utilities and does not support the State’s climate goals or the aim of reducing electric bills for low-income Californians, which was the purpose of AB 2316,” says Aaron Halimi, founder and president of Renewable Properties.

“It’s also further evidence that California’s utilities are doing everything they can to stifle distributed energy generation in order to tighten their grip on the state’s electricity grid. The vote solidifies California’s place near the bottom of community solar markets nationwide, ceding leadership to other states to truly democratize solar energy and fulfill national energy equity goals,” adds Coalition for Community Solar Access (CCSA).

Overall, the solar industry is very unhappy with how California has been proceeding (i.e., going backward) on solar power lately. “The CPUC’s recent series of decisions threatens to unravel California’s clean energy progress,” SEIA writes. “It’s past time for Governor Newsom and state leaders to reign in the commission before it inflicts more damage on customers and the state’s clean energy economy.” It’s hard to argue otherwise.

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