Californias new community solar program still isn’t working
From pv magazine USA
In California, where electricity demand is skyrocketing, the Public Utilities Commission’s final decision on community solar has yet to create a viable community solar program for solar developers and other stakeholders.
The California Public Utilities Commission (CPUC) issued a proposed decision in March that the Net Value Billing Tariff (NVBT) conflicts with federal law, leaving to question the future of the potentially burgeoning community solar market.
In May 2024, California approved a new community solar program following the enactment of Assembly Bill 2316 (AB 2316) in 2022. In this Decision, the CPUC kept most of the Proposed Decision language intact, but struck out the federal conflicts.
The new law was intended to incentivize more community solar development, expand solar energy access to low-income residents, and leverage federal funding opportunities. However, solar developers and advocates, including the Coalition for Community Solar Access (CCSA), say that the CPUC’s approved program only made minor changes to the previous programs that have failed. As a result, community solar developers are investing in other states with more viable programs.
The CPUC still has not released any information since then on how the program should be implemented, nor how federal Solar for All dollars will be spent.
CCSA favored their Net Value Billing Tariff (NVBT) proposal, which included adding energy storage to community solar projects, which helped to solve California’s grid instability problems.
NVBT met with strong support from the Solar Energy Industries Association (SEIA), GRID Alternatives, Vote Solar, TURN (ratepayer advocates), the California Building Industry Association (CBIA), the Natural Resources Defense Council, and more. Notably, investor-owned utilities, which serve over 75% of the electricity usage in the state, opposed the NVBT design. Unsurprisingly, the CPUC approved a utility-backed proposal with few changes.
pv magazine USA spoke with Aaron Halimi, founder and president of Renewable Properties, and Derek Chernow, Western Regional Director for CCSA, about the impact of CPUC’s final decision on California community solar projects. Renewable Properties is headquartered in California and has executed 177 MW of solar projects across 42 sites and 15 states. The company had been developing many California sites in anticipation of the NVBT design being approved. But because the CPUC approved the utility-backed design, the company is now shifting resources to more stable markets like New York, Illinois, and Maryland.
Chernow pointed out that California should be a major market for community solar. “California can be, and should be, the largest market for community solar companies, and it just isn’t living up to its potential.” To live up to its potential what’s needed are adders for capacity, for time and delivery, “and to make these pencil out, you need to make storage a viable part of any community solar installation,” Chernow said. He said that CCSA is hoping the state will look at how to extend the Solar for All money, a community solar program funded by the Inflation Reduction Act (IRA), to make the California program more attractive to solar developers like Halimi.
“We’re trying to make lemonade out of lemons with that decision,” said Halimi. He said that by using the Solar for All money, the state would create an upfront incentive similar to how the New York Sun program works with NYSERDA.
The NY Sun program has been a very successful community solar program, Halimi said. A program like that in California would “help make projects pencil and ultimately get some amount of megawatts onto the grid in the more immediate to medium term,” he said. But the Solar for All funds are limited and will quickly run out.
Many people working in the solar development community had been investing a significant amount of resources in anticipation of the CPUC coming to a workable decision, and the stakeholder support was “unprecedented,” Halimi said. “From the industry trade groups to the environmental justice folks to the ratepayer advocates, to the labor unions, to the building trade association–basically everybody except the investor-owned utilities– was supporting the net value billing tariff.” Because of this support, developers were investing into their pipelines here in California in anticipation of a workable program being implemented.
Since the decision, many developers including Renewable Properties, have shifted resources to other markets. “We’re shifting the dollars, the people power, the jobs… to other areas across the country where there’s more stable and workable community solar regimes,” Halimi said , adding that it’s too bad, since the company is based in California, but the company has reprioritized its efforts.
The California effect
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