The California Public Utilities Commission approved a proposal to reduce the rate homeowners are paid for providing power to the electricity grid from their rooftop solar panels. The move undercuts California’s efforts to reduce carbon emissions to address climate change.
The change to California’s net metering rule comes as Gov. Gavin Newsom eyes a run for the Democratic nomination for president. By throwing more than 1.5 million homeowners, business owners, and other electricity consumers in California with rooftop solar under the bus, the presidential hopeful may be prioritizing the national political clout of Big Utilities.
He’s clearly not prioritizing California’s plan to achieve an 85% reduction in carbon emissions by 2045.
California's three big monopoly utility companies – Southern California Edison, Pacific Gas & Electric, and San Diego Gas & Electric – have used their political power to lobby state officials for years to cut net metering rates, which pay rooftop solar owners the same retail rate for the excess electricity they add to the grid that utilities charge their customers.
Why commercial electricity producers should be paid a different rate than consumer-owned generation is beyond us.
The Big Utilities argued the old net metering rates led to higher electricity prices for consumers, but have made no vow to reduce their rates since the PUC voted unanimously to change net metering rules.
Solar energy companies have installed nearly 13,500 megawatts of solar generation on California's rooftops – a whopping contribution to the state's ambitious climate goals.
The solar industry anticipates California's new lower net metering rate will amount to a 75% cut in average payment rates to customers. Lowering the compensation will hinder solar installations.
California's decision to slash net metering rates will likely have implications for the solar industry nationwide, particularly companies in the residential solar space.
The new net metering rules take effect in April. We recommend homeowners and businesses who want to generate their own electricity with rooftop solar move quickly before the current rules expire.
As the Los Angeles Times noted, "rooftop solar is one of the most visible climate solutions in neighborhoods across the country — and a wildly successful one, with falling costs spurring growing installations."
Rooftop solar “has added jobs, brought new investment and created greater resiliency for the grid and for emergencies. There’s a reason Los Angeles is the No. 1 solar city,” Mary Leslie, president of the Los Angeles Business Council, told the LA Times.