State regulators have rejected an appeal filed by San Diego Gas & Electric Co. and other investor-owned utilities regarding how much money should be credited to business and residential customers whose rooftop solar panels feed electricity into the state’s power grid.
The California Public Utilities Commission dismissed SDG&E’s three-part argument, joined by Rosemead-based utility Southern California Edison Co., that the agency should revise its decision earlier this year establishing a new system for calculating how much solar customers should be reimbursed for their power. San Francisco-based Pacific Gas and Electric Co. also appealed the CPUC’s decision, albeit on somewhat different grounds.
The ruling handed down Sept. 22 appears to end a three-year battle between utilities and solar companies over a program known as “net metering,” which allows customers with solar panels to receive bill credits for their contributions to the grid.
Utilities have for years contended rooftop solar customers don’t pay their full share of the burden their systems place on the power grid, and that this shifts undue costs to other power users who cannot afford to generate their own electricity.
In their appeal, SDG&E and SoCal Edison specifically asserted the CPUC was wrong to leave power transmission costs off a list of “nonbypassable” charges solar customers must pay, and that it inappropriately allowed a 20-year transition period for solar customers on the commission’s earlier solar credits tariff. The companies also said the agency’s new credits system miscalculated sustainable growth of net metering.
The CPUC’s written response noted there is no statute or legal decision spelling out a required list of nonbypassable charges, and that a final determination on which charges should be included “is left to the commission’s experience and discretion.” It added that customers under the new tariff will pay transmission charges according to their net energy consumption.
“The … real issue appears to be less about whether transmission charges should be a (nonbypassable charge), and more that (the utilities) want transmission charges to be based on total electric consumption” before contributions to the grid are calculated, the commission wrote.
As for the length of the transition period to a new net-metering tariff, the agency said it wanted to make sure customers under the previous system have an opportunity to recover the cost of their investment. Setting a shorter period, it wrote, “would potentially undermine customer and regulatory certainty, and would discourage future investment in renewable distributed energy.”
Responding to the sustainable growth charge, which was also raised by PG&E, the CPUC said state legislation at the heart of the utilities’ net-metering argument did not rule out some shifting of costs between solar and non-solar customers. The agency added that it reserves the ability to adjust the new tariff “as more information and data concerning program costs and benefits,” as well as policies such as how to structure residential rate, become available.
SDG&E is a subsidiary of San Diego-based Sempra Energy, a Fortune 500 company with 2015 revenues exceeding $10 billion.