INSTALL SOLAR PANELS & BE A POWER PRODUCER?

Chris Bellizzi ran his air conditioning more than he normally would, more than he needed to, in Summer 2007. Why? Because he didn’t want utility PG&E to profit from the free electricity his home solar installation was sending it.

Bellizi: "If you owe them, you've got to send them a check...If they owe you, they'll pocket it."

California’s Assembly is considering a change to its “net metering” law, AB1920, that would change Bellizzi’s situation, the first such U.S. provision to do so. It would allow home power producers to do more than just wind their electricity bills to zero, as most net metering provisions allow. It would require the utilities to pay for excess electricity home systems send to the grid. Sounds only fair, right?

PG&E, one of California’s biggest utilities and biggest boosters of solar energy, opposes AB1920. So does The Utility Reform Network (TURN), an important ratepayer advocate. Why?

For interesting reasons that reveal how hard it is to make good legislation and how hard it is to create good incentives.

PG&E contends that the payments from the utilities to system owners like Bellizzi would come out of the pockets of their other ratepayers. Since solar system owners are usually more affluent than non-owners, it would constitute a sort of unfair subsidy by those who can’t afford solar for those who can. PG&E also objects to AB1920 letting city-owned utilities off the hook on this.

TURN points out that California already subsidizes home solar energy installations through its Million Solar Roofs program (aka California Solar Initiative, aka SB1). Because of that measure, solar system owners are being “paid” at a premium rate (25 to 30 cents/kilowatt-hour) for their power instead of the normal (9 to 10 cents/kilowatt-hour) rate - until their meters wind back to zero.

Opponents of the measure suggest that if system owners want to even the rules, the state ought to even the rates as well.

Marcel Hawiger, TURN staff attorney: "Homeowners who generate excess electricity should be paid fairly for that electricity, but shouldn't be subsidized a third time by the rest of the ratepayers, who already fund generous subsidies for rooftop solar…"

Assembly Jared Huffmann (D-San Rafael), the AB 1920 author, and Environment California think differently. Dan Jacobson, legislative director, Environment California: "We should take away any disincentives there are…We don't expect this to be a huge moneymaker…This will only help to pencil out solar a little faster."

Seems like Huffman might need to head back to the legislation drawing board to iron out some of the complications. He might need to keep his calculator handy.

California would shift the profits to the power producers. (click to enlarge

Cashing in on your solar savings; Bill would force utilities to pay for excess power
Matt Nauman, April 12, 2008 (San Jose Mercury News)

WHO
California Assemblyman Jared Huffman (D-San Rafael); Chris Bellizzi, California homeowner and home solar system owner; California utility PG&E (Keely Wachs, spokesman); The Utility Reform Network (TURN) (Marcel Hawiger, staff attorney); Environment California (Dan Jacobson, legislative director)

If the consumer owns the power, it seems like the consumer ought to get paid for it. (click to enlarge)

WHAT
AB 1920, a bill before the California Assembly that would increase payments to solar system owners from utilities.

WHEN
- AB1920, introduced by Huffmann, is presently working its way through the legislative process.
- AB 1969 was enacted in 2007 to allow solar system owners to choose from categories for reimbursement.

An alternative idea is to put the expense and metering costs on the utility. (click to enlarge)

WHERE
- California would be the first state to require payment to home solar system owners.
- Michigan, Minnesota, Rhode Island and other states are considering such measures.

WHY
- The California Solar Initiative and other existing laws, the size of a solar system is limited to proportions consistent with the building it is built for, preventing the likelihood of significant electricity overproduction.
- Current provisions allow solar and wind system owners to wind their bills all the way back to zero but not to become “power producers” by earning money from their systems.
- Only 7% of California PG&E solar system owners generate excess kilowatt-hours.
- PG&E objects to money going from its non-solar system owners to its solar system owners and it objects to having city-owned utilities excluded from the same rules it would have to follow and the same expenses it would have to bear.

It’s the 21st century – do you know where YOUR meter is? (click to enlarge)

QUOTES
Assembly Jared Huffmann (D-San Rafael): "If they generate surplus power beyond their own energy needs, that's a gift to the utility…There's no compensation…This bill for many people will improve the economics…"