The California Public Utilities Commission (CPUC) voted on November 16 to approve changes to the Virtual Net Energy Metering (VNEM) and Net Energy Metering Aggregation (NEMA) programs that will make solar much less affordable for many types of consumers, according to the California Solar & Storage Association.
For properties with multiple electric meters like schools, farms, apartments and small businesses in strip malls, going solar will no longer be financially viable through the VNEM or NEMA programs, which bring the benefits of going solar to consumers who otherwise would not benefit from Net Energy Metering (NEM), the program that makes solar more affordable by crediting consumers with solar systems for the excess energy they produce and share back with the energy grid.
The new decision bars buildings with multiple electric meters from using solar energy produced on their rooftops to offset utility bills. Instead, these properties will have to sell the energy they generate to utility companies at low rates and buy it back at higher rates.
Before the vote, the CPUC’s proposal was revised to allow net metering for residential meters in apartment complexes. However, the economic incentives for building owners to install solar for the building is still lost as meters in common and shared areas like hallways, gyms, outdoor areas and EV charging stations will not be able to participate. If building owners are not motivated to install solar in the complex, individual tenants cannot benefit from solar either, CALSSA said.
“It is astonishing how intent the CPUC is on continuing to block the growth of solar at the expense of consumers and our state clean energy goals for the benefit of big utilities like PG&E,” said CALSSA executive director Bernadette Del Chiaro. “Not only is California nowhere near the renewable energy capacity we need, the solar industry is already experiencing a loss of solar jobs and small business closures from the CPUC’s attack on solar for single-family homes last year. This decision is yet another loss for consumers and another step backwards for California’s clean energy goals and fight against climate change — the only winners here are big utilities and their shareholders. The CPUC and policymakers need to stop undermining and meddling with the successful policies that made California a solar state in the first place and get back to promoting true solutions for consumers and the planet.”
According to the CPUC, the new virtual net-metering tariffs, like NEM 3.0, are meant to encourage customers to adopt battery storage and export solar energy in the evening hours when the grid needs it most. The new tariffs only apply to future customers, and there is a 90-day grace period for prospective customers to enroll in existing tariffs before the new tariffs go into effect.
“Today’s CPUC decision is likely to leave many of California’s prime rooftops barren, with little incentive to install solar panels. Every viable rooftop without solar panels is a missed opportunity to generate renewable energy and cut down on utility bills,” said Environment California’s clean energy advocate Steven King in a press statement. “This week’s National Climate Assessment reminds us of the potentially severe consequences of global warming. The best way to dramatically reduce California’s climate pollution is to go all in on proven, ready-to-deploy solutions like rooftop solar. California can grow solar smartly and quickly by installing it on rooftops, parking lots, and land along highways.”
Solar advocates are urging Governor Newsom and other leaders to find ways to repair the damage done by the CPUC in order to keep solar growing, save green jobs and help California get back on track with the state’s clean energy goals.
News item from CALSSA and Environment America
The CPUC changed the Net Energy Metering policy in late 2022 to lessen the financial burden on non-solar system homes (the CPUC assumed these are primarily low income people), and make residential solar systems about 3 times more expensive in their recent Net Energy Tariff decision (was previously called Net Energy Metering). This was a blow to the roof top solar opportunities in California.
Now the CPUC extended this tripling of the payback time to small solar systems that have multiple meters on their single property. Few people would install a solar system that is guaranteed to take around 15 years to payback the initial investment. These solar system users are part of the Virtual Net Energy Metering (VNEM) and Net Energy Aggregation (NEA) programs which were set up to extent solar to many more potential users.
Effected by this CPUC decision are small businesses in a business complex such as a strip mall, as well as schools and farmers. This decision by the CPUC seems to reduce the solar potential in California and will directly impact our goal of transition to 100% renewables by 2045. The only perceivable winner in this decision are the private monopoly utility companies who pay rooftop solar owners about 5 cents/kWh for excess electricity shipped to the grid while charging customers over 30 cents/kWh for that electricity.
It should be noted at just prior to adopting this ruling, apartment buildings were excluded but it would not apply the common areas such has hallways, gyms, outdoor areas and EV charging stations. The electricity of most of these demands outside individual apartments are usually paid for by the building owner. If building owners are not motivated to install solar in the complex, individual tenants cannot benefit from solar either. So the CPUC is essentially excluding almost all multi-meter customers from having access to reasonably priced solar. This putting the brakes on solar use by multiple meter solar properties including apartment dwellers, flies in the face of the CPUC justification for the change-over to the Net Energy Tariff approach because the prior NEM scheme excluded poorer customers.
The CPUC says one of its main goals in the recent decisions to make roof top solar more expensive, it is force customers to install battery storage to increase grid stability. Small house sized storage is about the most expensive way to increase grid stability as we approach our state goal of 100% zero carbon sources electricity. Larger utility scale storage is certainly more economic including auto battery units that are no longer suitable for transportation applications and can be repurposed. Car-to-grid access to utility storage is a large resource to provide grid stability.
Simple things like smart inverters on the user side of the meter and grid forming inverters will also increase grid stability. Season storage will likely be achieved by generating hydrogen from excess renewables and used via fuel cells or gas power plants. Policy that encourages these more cost-effective hour to days to months energy storage makes a great deal more sense than forcing home owners to buy expensive small unit storage.
That last few percent of grid electricity is currently generated by capital cheap gas peakers. This is expensive electricity but it is only needed for about 100 hours a year. The future 100% non-carbon renewable energy grid of the future ( ~ 2045) will likely need a similar solution for that last few percent. Peaker power plants can be run on renewable fuels such as ethanol from non-food biomass or gases like methane from biomass or hydrogen from excess renewable electricity. Some of today’s solutions to maintain grid reliability will still apply in the sustainable future.