The California Public Utilities Commission (PUC) was considering a controversial plan to cut the financial benefits of residential rooftop solar customers currently enjoy. The efforts were made by some big utilities to lower the solar energy export compensation rates and add a monthly solar fee.

But that decision is now on hold, indefinitely.

The decision of delaying the matter is at least a short-term win for solar installers like us. Proposed revisions if implemented would surely lead to a sharp decline in installations which would harm California’s efforts to combat climate change.

Following is a statement from Sean Gallagher, Vice President of State and Regulatory Affairs at the Solar Energy Industries Association (SEIA) on the delay:

“The proposed decision never made sense for a host of reasons. It would have compromised the reliability of California’s electricity delivery system, harmed California’s effort to tackle climate change, and cut jobs and economic opportunities for all Californians. The increased costs and loss of demand for solar also would have made solar less accessible to moderate- and low-income families. We look forward to continuing to work with the California Public Utilities Commission as it considers any changes to net metering.”

Reuters reported that the matter was delayed because the new Commissioner, CPUC President Alice Reynolds, joined the regulator late last year and did not participate in the lengthy process to consider changes to the policy. One other member also joined the five-person board in recent weeks.

While backing the proposed amendment, the utilities tried to trick PUC by making a point that energy produced by large-scale solar is very cheap and advocating that large-scale should be pursued instead of local scale solar. What they always forget about transmission part and its associated cost. They also neglect the risk that distributional power outages will obstruct access to it. Moreover, large-scale solar has done little to lower the average price of electricity due to transmission cost, maintenance, etc.

Whereas the truth is that by installing rooftop solar panels, customers can lower the effective price to more than half of that amount.

California is also a leader in the world of electric vehicles (EV’s), with more than 40% of the national market. But the proposed amendment could erode that status as well. EV’s and rooftop solar are seen as gateways to one another. California has some of the highest electric rates in the country but once a customer has installed rooftop solar panels, having an EV becomes affordable. PV+EV is indeed a great combination.

Consulting firm Wood Mackenzie was also of the opinion that California’s newly proposed net metering tariffs would cut the state’s residential solar market in half by 2024. The firm has even concluded that if approved, NEM 3.0 will likely start impacting solar installations in July or August of this year itself.

The Golden State is the flag bearer for envisioning and creating the future. The proposed decision despite its talk of modernization is a throwback in time.

The solar industry lobbied in force against the proposed decision, organizing rallies in Los Angeles and San Francisco and filling the phone lines during the CPUC’s Jan. 27 meeting to tell commissioners about the harm the proposed decision could inflict.

California has made a strong commitment to decarbonization and rooftop solar has a big role in it. It has mandated solar roofs on new homes for a reason. The CPUC needs to reject the proposed anti-solar decision and start all over again. It needs to come up with an alternative, looking at real options to solve the problems the CPUC says it wants to solve.

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