Electricity, and the means to generate it, hinges on a number of rapidly changing resources: water behind dams, factory staffing in China, sun and clouds, and now the new rooftop-solar billing rules released by the state Public Utilities Commission (CPUC) last week. Though the rules are intended to further California’s goals toward fewer greenhouse gases from fossil-fuel power sources, the decision is being slammed from all sides: The solar industry argues fewer incentives mean fewer households will choose to install expensive solar panels. Consumer groups say the subsidy for existing solar rooftops will unfairly continue.
Administrative Law Judge Kelly Hymes, who wrote the lengthy CPUC decision, sees solar costs going down. In fact, she estimated that prices were declining so quickly that five years was long enough for the solar industry and customers to need less of a subsidy. The details are just about as complicated as buying electricity on the futures market, but here they relate to new residential solar installations after April 2023. Existing home solar billing will not change, Judge Hymes wrote.
A fact sheet assembled by the CPUC estimated that on average, the new Net Billing Tariff would take up to $100 off a monthly electric bill, and up to $136 off if battery storage is installed. To estimate what consumers will receive from exported energy per kilowatt-hour, the CPUC employs something called the Avoided Cost Calculator (ACC), which is based on the value of electricity to the grid, or wholesale price, which changes with time of day and season. But even Hymes acknowledged the ACC might be a shock to the solar industry, so various pennies are tagged on over the next five years. The sum total is supposed to pay off the setup in nine years. (Nonresidential solar pricing is per the ACC alone, as costs are paid off in nine years or less, according to the CPUC.)