California regulators try to boost solar use at solar’s expense

Source: Debra Kahn, E&E News reporter • Posted: Monday, July 16, 2018

California regulators last week approved new electricity rates in Southern California Edison’s territory intended to encourage consumption of solar power, but they could have the effect of discouraging new solar, as well.

The California Public Utilities Commission’s decision extends springtime “super-off-peak” rates in SCE’s territory to encompass eight months out of the year, from the hours of 8 a.m. to 4 p.m. Previously, the rates had applied to only March, April and May, the months of the year when California is producing the most solar. The new rates stretch from October through May.

Lower rates could encourage customers to concentrate their electricity use during those times; the state has been grappling with an excess of solar power during the day and sometimes has to curtail production.

But the low rates could also discourage homeowners and businesses from installing solar panels, because they will receive less for power sent back to the grid. The rates that panel owners receive for power under the state’s net metering rules are governed by the overlying rates that electricity customers pay the utilities.

A solar trade group reacted to the decision, saying it would hurt installation rates.

“This decision is not supported by the cost data put forth by the utility in this case, and will make it more difficult for customers to go solar at a time when California needs customer investment in clean energy resources to meet its goal of developing a cleaner, more resilient grid,” the Solar Energy Industries Association’s California director, Rick Umoff, said in a statement.

It’s too early to estimate how much the decision will affect solar installations in SCE’s territory; the CPUC will start hammering out actual rates this fall. Yesterday’s decision sets out the time windows that the eventual rates will occupy. The state’s other large utilities are at different stages in their rate design proceedings and aren’t expected to immediately follow suit.

SCE had opposed SEIA’s push to shorten the low-rate period, arguing in a filing that “the Commission should set TOU [time of use] periods based on underlying costs, not on the resulting financial outcomes for a subset of customers.”