California solar market lagging a year after policy shift — DOE lab

Source: By Jason Plautz, E&E News • Posted: Monday, May 20, 2024

In the aftermath of the state’s net metering rate cuts, panel installations are down while storage is up.

Workers install solar panels on a rooftop in Pomona, California.

Workers install solar panels on a rooftop in Pomona, California. Mario Tama/AFP via Getty Images

California experienced its worst first quarter for rooftop solar installations in more than a decade, according to a federal report, continuing a steady decline since the state cut reimbursement rates for excess solar power generated on homes.

A new report from the Department of Energy’s Lawrence Berkeley National Laboratory finds that rooftop solar installations fell off after California implemented its net metering reforms last spring. The state averaged roughly 8,000 installations per month in the first quarter of 2024, the lowest of any month since May 2020.

The report looks at a year of data since the California Public Utilities Commission made sweeping changes to the state’s net metering rules, instituting a system known as the net billing tariff. That rate design sharply cut the amount solar owners could get for excess solar sent back to the grid. But it made the rates variable and based on time based on time, so customers would be paid more for sending back power when the grid was most stressed in the early evening.

The impact of that decision will be closely watched as more states consider changes to their own net metering programs, even as the Biden administration works to get more solar panels on homes across the country.