EGN NEWS DESK
A 3-year effort to revamp California’s moribund community-solar market, spurred by state legislation and backed by photo voltaic business teams, client advocates, environmental-justice organizations, labor unions and the state’s homebuilding business, could now be in jeopardy.
On Monday, the California Public Utilities Commission issued a proposed resolution that sides with California’s main utilities towards this broad coalition. It discovered that the Net Value Billing Tariff (NVBT) coverage these teams assist “conflicts with federal legislation and doesn’t meet the necessities” of AB 2316, the 2022 state legislation that ordered the CPUC to create an inexpensive and equitable community-solar program.
The Coalition for Community Solar Access, a commerce group representing photo voltaic builders which created the NVBT in 2021, excoriated the proposed resolution in a Monday press launch, stating that it “manages to each misread federal legislation and our proposal, and ignores precedent that has been set by states deploying neighborhood photo voltaic for greater than a decade.”
The CPUC’s proposed resolution additionally conflicts with the view of 20 California lawmakers concerned in passing AB 2316, who in a September letter to the CPUC instructed the company that the NVBT “most intently aligns with the intentions” of the legislation.
Building a workable construction for neighborhood photo voltaic — midsized photo voltaic tasks that present shares of their energy to households, companies and organizations that subscribe to them — “shall be important to a profitable power transition whereas making certain that renters and low-income Californians are afforded the identical alternative to take part and cut back utility payments by means of distributed power assets as rich householders,” the lawmakers wrote.
Monday’s proposed resolution would order the state’s utilities to satisfy AB 2316’s mandate not through the NVBT, however by altering present community-solar and wholesale-market distributed power packages. These packages have been well known as failed experiments over the course of their decade-plus existence.
Those failures are exactly why backers of the NVBT got here collectively to assist another they hoped would allow California to flee its laggard standing on implementing neighborhood photo voltaic. California has lower than 600 megawatts of large-scale distributed photo voltaic developed up to now, in comparison with a whole of 6.2 gigawatts within the 22 states with insurance policies that assist community-solar packages. The NVBT may allow about 8 gigawatts of neighborhood photo voltaic paired with batteries to be inbuilt California utilizing present grid infrastructure, in line with evaluation from the Coalition for Community Solar Access — an essential contribution to state clean-energy targets.
The NVBT program would additionally encourage builders so as to add batteries to megawatt-scale photo voltaic tasks to assist shift solar energy into night hours when the state’s grid faces electrical energy shortfalls. And underneath AB 2316, tasks would wish to supply not less than 51 % of their capability to serve low-income residential clients at costs that cut back their electrical energy payments — useful in a state with excessive and rising utility prices.
An unusually massive variety of teams have rallied round NVBT. Environmental-justice teams say it may permit deprived communities and renters to entry lower-cost solar energy and cut back reliance on polluting fossil-gas-fired energy crops.
And building business teams assist the NVBT as a method to meet state mandates that require nearly all new properties and plenty of industrial buildings to provide photo voltaic to their occupants. The prices and practicality of assembly these building-code mandates are a specific concern for homebuilders after the CPUC drastically decreased the worth of residential rooftop photo voltaic within the territories of Pacific Gas & Electric, Southern California Edison and San Diego Gas & Electric.
Now these teams worry that Monday’s proposed resolution from CPUC Administrative Law Judge Kelly A. Hymes — who additionally crafted the CPUC’s rooftop-solar resolution and one other resolution slashing compensation for shared photo voltaic techniques for multifamily properties, faculties and farms in many of the state — will reduce off what will be the final viable avenue for non-utility-scale photo voltaic in a state that’s nonetheless far off tempo to satisfy its clean-energy targets.
They additionally worry that the proposed resolution, if accepted by CPUC commissioners, may undermine California’s hopes of receiving federal help to broaden neighborhood photo voltaic. The Inflation Reduction Act handed by Congress in 2022 put aside $7 billion to assist low-income households entry solar energy, together with through community-solar packages. California is looking for funds from that program, however pro-community-solar teams warn that the state could lose out towards different candidates if it lacks a viable community-solar program to make the most effective use of the cash it’s asking to obtain.
“I’m gobsmacked,” mentioned Brandon Smithwood, senior director of coverage at neighborhood photo voltaic developer Dimension Renewable Energy. While the CPUC may vote on the proposed resolution as early as mid-April, he’s hoping that commissioners will demand modifications to the proposal or concern another proposal. “I don’t see how this isn’t held for additional consideration.”
Does neighborhood photo voltaic violate federal legislation? California regulators say sure
The Coalition for Community Solar Access (CCSA) structured the NVBT on some of the profitable state neighborhood photo voltaic packages within the nation — the one run by New York, which had put in greater than 2 gigawatts of neighborhood photo voltaic as of the tip of final 12 months. By modeling its proposal on an present and thriving program supported by state policymakers and regulators in New York, CCSA had hoped to beat objections from utilities that the NVBT would possibly one way or the other contravene present federal legislation.
But in Monday’s proposed resolution, the CPUC agreed with an argument put ahead by California’s three massive utilities that the NVBT strategy would the truth is violate federal legislation — a stance that seems to battle with how neighborhood photo voltaic has been handled in different states.
The California utilities argued that, in contrast to rooftop photo voltaic, batteries, electric-vehicle chargers and different distributed power assets related to the low-voltage distribution grid, that are topic to state jurisdiction, the community-solar and battery tasks envisioned for NVBT fall underneath federal legislation that governs larger-scale mills working in wholesale power markets.
That view is predicated on an interpretation of the Public Utility Regulatory Policies Act (PURPA), a 1978 legislation that requires utilities to buy energy from sure non-utility-owned mills underneath buildings ruled by the Federal Energy Regulatory Commission.
The query of whether or not state or federal authority prevails over power tasks that hook up with distribution grids largely topic to state authority is a sophisticated and contested concern. Even state rooftop photo voltaic net-metering packages have been unsuccessfully challenged — not less than to this point — as a violation of PURPA, even if their function is to find out how utilities reward clients for the ability generated on their very own property, slightly than with the majority transmission techniques the place the Federal Energy Regulatory Commission clearly has jurisdiction.
But NVBT supporters pointed to the shortage of earlier authorized challenges towards comparable state community-solar packages in New York, Maine and Massachusetts as a good motive to reject the argument put ahead by California’s main utilities.
“FERC had repeatedly held that web metering and web billing tariffs between a retail buyer and its utility should not inside its jurisdiction and never topic to the necessities of PURPA,” The Utility Reform Network famous in feedback to the CPUC final 12 months. The nonprofit advocacy group for California utility clients acknowledged that there’s “no occasion of FERC asserting jurisdiction over, or ordering modifications to, a digital web metering tariff or neighborhood renewable power program accepted pursuant to state legislation.”
Hymes seems to dismiss these factors in Monday’s proposed resolution, stating that “the NVBT proposals don’t equate to retail fee packages however as a substitute resemble wholesale electrical energy procurement.” While the proposed resolution doesn’t handle how different states have handled these points, that stance would seem to forged into query the legality of many different state packages that share comparable traits.
“I don’t suppose that is going to face. The fee has not adopted this; it’s nonetheless the judge’s proposal,” Smithwood mentioned. “But if the fee did [adopt it], and I was one other main [renewables] state within the nation, I can be involved [that CPUC is] handing an argument to opponents to the clear power transition, who may say, ‘Look at what California says.’”
