(CN) — After making some noise at a California Public Utilities Commission meeting in March to protest proposed rules that will decrease the incentives new solar panel owners will get for giving their excess energy back to the grid, environmentalists have taken their case to the First Appellate District.
The new rules, which took effect April 15, revolve around “NEM” or net energy metering, a tariff created for people with solar panels which allows them to give energy they don't use to the grid. For that, customers are given credit on their electrical bills.
In December, the utilities commission updated the tariff that bolsters incentives provided by the federal government from the Inflation Reduction Act for solar and battery storage. The agency also added more electricity bill credits to people who put in solar and solar battery storage in the next few years, including low-income people and members of Native American tribes. Most controversially, the commission adopted a rate change for homeowners who install rooftop solar panels for the first time.
The commission touts the changes as ways to encourage people to use electricity when it’s most beneficial for grid reliability, put in battery storage and to shift load demand from evening hours to overnight or midday hours.
But the Center for Biological Diversity, the Protect Our Communities Foundation and the Environmental Working Group say the new tariffs will slash what rooftop solar owners get from sharing their excess energy by 75% to 80%, making solar less financially beneficial.
The groups claim the commission ruined a successful program that helped provide 7% of the state’s total electricity supply in 2019. In their petition filed with the First Appellate District, the groups say the program “empowered ordinary California residents to personally contribute to phasing out polluting fossil-fuel generation and has also benefited the grid as a whole by increasing resilience and reducing transmission and infrastructure costs."
Meanwhile, the new tariffs will dramatically reduce the growth of rooftop solar and other distributed generation of energy. This means the commission is violating a number of legal requirements the Legislature put down for the NEM tariff successor, including a requirement to produce policies that continually grow rooftop solar and distributed generation.
“The decision makes the installation of new solar systems economically unattractive and, as a result, will dramatically decrease growth of NEM resources. The commission justified its abandonment of the statutory mandate for sustainable growth on the purported need to avoid costs to non-participants and balance other statutory directives. This justification not only ignores the real benefits of distributed generation, it contravenes the statutory language and legislative history, which command the Commission to achieve all of the statute’s goals,” the groups say in their petition.
They claim the new tariffs are a result of the commission bending to the whims of for-profit utility companies.
“By shifting generation closer to customers, NEM has decreased the need for utility transmission infrastructure and threatens utilities’ profits. Thus, corporate utilities have fought NEM policies nationwide, promoting a narrative that they raise rates for low-income customers by purportedly creating “cost shifts” from wealthier NEM customers to everybody else. At the same time, however, these same utilities have disconnected hundreds of thousands of low-income customers in the last several years and spent billions of dollars on transmission infrastructure that drives significant rate increases for all customers,” they say in their petition.
The new tariffs make it even harder for people to install rooftop solar panels, especially in low-income communities and working class communities, which they describe as “the largest demographic installing rooftop solar” in 2021, and in communities of color, and communities affected by environmental justice issues.
And the groups fault the commission for failing to take up the idea of community solar programs.
"The decision fails to adopt community solar programs that could serve DACs [disadvantaged community] residents, the majority of whom do not own their roofs. With community solar, a centralized solar system is installed on schools, churches, community centers, or other public buildings to serve nearby residences that would not otherwise be able to reap the benefits of rooftop solar. By refusing to adopt any community solar program, the commission passed up an ideal opportunity to satisfy section 2827.1’s equity enhancing requirements,” the groups say in the petition.
Roger Lin, an attorney for the Center of Biological Diversity, called the new rules "bad for our climate, bad for environmental justice communities,” especially since rooftop solar is an important component in mitigating the effects of climate change.
Lin said the commission rammed the tariff change through despite the groups filing for administrative review this past January, leading to Wednesday's petition with the First Appellate District. The commission had said it would respond to the request for review at its June meeting.
“If the commission is just going to bulletproof their decision, they might as well do that in front of the court,” Lin said.
"The CPUC will respond to the lawsuit as part of the litigation process. The CPUC expects to consider the pending Applications for Rehearing at its regularly scheduled Voting Meeting of June 29, 2023, barring an unexpected delay," wrote Terrie Prosper, the director of the News and Outreach Office at the California Public Utilities Commission.
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