Solar power in California scored a big victory today as state regulators jacked up the number of homes, businesses, schools and public agencies that can offset their electricity costs by sending excess solar power to the grid.
The hike in the number of systems eligible for what is known as “net energy metering” (NEM) comes as a result of what the California Public Utilities Commission called a “clarification” of state law. Previously, electric utilities were obligated to offer net metering credits to customers only until the amount of installed solar capacity equaled 5 percent the utility’s total peak demand. That limitation could have left at least one big utility, Pacific Gas & Electric, turning away net metering customers as early as next year.
Under the new legal interpretation, which passed on a 5-0 vote, utilities will calculate their peak demand by adding together each individual customer’s peak demand. “This clarification doubles the amount of solar systems that can benefit from NEM, providing the benefits of solar energy to many more customers,” the PUC said.
Solar advocates immediately hailed the decision.
“This critical decision will enable more Californians to go solar, with the potential to add roughly two gigawatts worth of solar power—twice the amount currently installed on homes, schools, farms and businesses across the state,” Environment California said in a statement.
Along with the reinterpretation of the net metering law, the PUC said today it would begin examining “the costs and benefits of NEM for non-participating customers and to consider possible revisions to the NEM program.” Some activists have complained that net metering benefits the wealthy, who can afford to install solar power, at the expense of lower-income consumers, whose rates might rise to compensate utilities for revenue lost to individual solar-power producers.
Even as it voted to expand net metering, commissioners acknowledged that possibility. “In order to protect non-participating customers from potentially excessive costs, the CPUC would suspend the NEM program for new NEM customers on January 1, 2015, if new NEM policy rules are not adopted by that date,” the PUC said.