Diving Brief:
- For markets where rooftop solar penetration has begun to exceed 10%, policy makers need to reconsider their net metering policies to ensure they strike a “reasonable balance” between environmental priorities and sustainability. fairness to taxpayers, said the deputy director of the Vote Solar program. Suzanne Churchill told an audience at the RE+ conference on Wednesday.
- Southern California Edison, which serves the Anaheim, Calif., area, pays more than $1.6 billion to net metering customers, while spending $600 million in reduced electricity rates for low-income customers , according Caroline Choisenior vice president of corporate affairs for Southern California Edison.
- Walker Wright, Sunrun’s vice president of public policy, said the company wants to take the conversation beyond net metering to what comes next. “We want to electrify the house. We don’t want to discuss the value of an electron exported to the grid at 3 p.m. on a Tuesday,” he said.
Overview of the dive:
Participants in an RE+ panel on pricing trends generally agreed that the days of net metering policies are over in many states. But finding consensus on what should follow could prove difficult.
“Here in California, we are in a period of relatively extreme inflation,” said Matt Boulanger, Director of the Public Advocates Office for the State of California. Rates have risen about 50 to 80 percent in the San Diego area, and Baker said his office determined that net metering was responsible for 15 to 25 percent of that increase. In some cases, he said, these increased rates have deterred California homeowners from taking actions such as installing heat pumps, which threatens the state’s overall climate goals.
“We can’t afford the increased rates,” Baker said. “Our climate experience is too important to crash into the high cost benches.”
Wright noted that Sunrun is also ready to move away from net metering by expanding its services from simple solar panel installation to include a variety of offerings, including electric vehicle charging stations and home electrification, which are expected to benefit the network. But the current focus is storage, he said.
“It’s not about the value of an electron. It’s about how we can deploy more distributed generation, create network value, and I go back to Sunrun’s business model: create network value while enabling customers to be more resilient,” said said Wright.
Choi and other panelists agreed that the focus for future tariffs should be on encouraging the adoption of storage, or solar plus storage, and not just storage alone. Panelists also agreed on the need for incentives to help increase adoption of solar power, storage and other upgrades for low-income households.
But how to achieve this remains a matter of debate in California, with some parties, such as Baker, supporting flat-rate or income-based charges and upfront incentives for distributed energy systems and electrification — moves they say would benefit to low-income customers who often miss out on the benefits of solar. Rather than privatizing the resiliency benefits that come with storage and distributed generation, Baker said, his office would “put first how to decarbonize the grid and how to promote electrification and decarbonization of the economy.” Resilience is important for the whole system.
Sierra Club and Vote Solar advocates, however, objected to the creation of a flat-rate charge, which they say could discriminate against and reduce solar installations.
“That’s not to say we don’t think there should be a small fixed charge,” Churchill said. “What we don’t want are solar-only tariffs. You need to have a process where those fixed costs are reasonable and it’s still affordable for the consumer to go solar because we need to incentivize them to install rooftop solar and storage to meet our climate goals .