The solar industry faces a setback in California, the largest solar market in the country, after an important bill failed to win approval before the state legislative session ended last week.
The bill would have raised the amount of solar electricity that utilities can buy from their customers, and solar advocates say rooftop solar installations – and thousands of related jobs – are in danger if the limit isn’t raised soon.
The buy-back practice is known as net metering – an arrangement enabling utility customers generating their own electricity to feed power back into the grid, reducing their electricity bills. California law limits the amount of electricity derived this way to 2.5 percent for each utility.
But one of the state’s largest utilities, Pacific Gas and Electric, is on track to reach that limit next year. The solar-advocacy group Vote Solar, citing new federal and state financing programs likely to spur homeowner solar, has predicted that the utility could reach the limit as soon as the first quarter.
If the utility reaches the cap before it’s extended, new solar customers would no longer see lower electricity bills, and rooftop solar installations would stall, advocates say.
The state Senate was considering a proposal – already approved by the Assembly – that would have raised the cap to 5 percent, but a labor dispute about who would install the systems tied up the bill until time ran out.
(Earlier this month, the bill was re-referred to the Senate’s economic development committee after the introduction of an amendment that would have required electrical contractors, not solar contractors, to install larger systems.)
Solar groups originally had hoped to expand the net-metering limit to 10 percent, but amended the bill to 5 percent after all three investor-owned utilities opposed it, saying they didn’t want such a large increase until the costs and other impacts of the program were studied further.
PG&E and Southern California Edison support the amended bill, but San Diego Gas and Electric continues to oppose it.
While SDG&E supports the idea of net metering, it wants to wait for a legislative review – scheduled for next year – before raising the limit above 3 percent, according to Jennifer Ramp, a spokeswoman. The utility believes that the program’s costs unfairly burden non-solar customers, Ms. Ramp said.
For example, net-metering customers are exempt from some of the fees that help maintain the electrical grid, even though they’re still using that equipment, and also don’t contribute to the program that finances solar subsidies, she said. “We just want to make sure the cost impacts aren’t spread unevenly.”
The Senate could take up the bill again in a special session or after it.
