California Utilities Want to Curb How Much Power Consumers Can Sell to Grid from Solar; Could Hurt Solar Adoption

If someone pays you less for something, then you probably won’t produce as much. That’s just basic economics.

Now power utilities in California want to trim how much solar power consumers can sell back to the grid. If that happens, then people will be less likely to install solar panels, which can cut into renewable energy adoption.  What’s a state like California to do?

Policies made in California, the nation’s biggest market for rooftop solar panels, often serve as a template for other states that are seeking to replace fossil fuels with renewable energy to fight climate change.

This week utilities, solar industry representatives, ratepayer advocates and others are presenting their ideas on potential reforms to officials at the California Public Utilities Commission, who will make a decision later this year. The new policy would likely take effect in 2022 or 2023.

The competing proposals presented on Tuesday and Wednesday focus on a decades-old policy called net metering, which allows homeowners with solar panels to sell the excess power to their utility at or near the full retail rate.

The incentive has propelled installations, helping residential solar behemoths like Sunrun Inc and Tesla Inc, as well as hundreds of small local firms.

The power industry, however, argues that the policy is overly generous, and shifts billions of dollars in grid maintenance costs to their customers without panels, who tend to be less affluent than solar owners.

Bernadette Del Chiaro, executive director of the California Solar & Storage Association, said:

“If we really put the brakes on rooftop solar today… we’re going to be in a world of hurt in 10 years when you wake up and realize ‘We actually do need to build (more solar panels).'”

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