California’s New Proposal May Endanger Multi-Meter Rooftop Solar Installations
The California Public Utilities Commission (CPUC) has once again returned with a controversial proposed decision, this time aimed directly at multi-meter rooftop solar systems. This latest move has been perceived as another attempt to stack the deck against the rooftop solar industry.
The specifics of the proposed decision reveal potential challenges for a wide range of rooftop solar users, particularly renters in multifamily housing, small farms, schools, and colleges. By setting strict limits on how much electricity produced by rooftop solar can be self-consumed by multi-meter properties, the policy is seen as effectively forcing customers into a financial bind. Rather than using the solar power they generate, customers will have to first sell this energy to the utility company, only to buy it back at a higher rate.
This decision has implications for California’s existing Virtual Net Metering and Net Energy Metering Aggregation programs. These initiatives have allowed properties with multiple meters to install a single solar array, thus sharing the electricity and associated net metering credits with all customers and meters on the property. However, the new proposed decision seeks to restrict these customers, limiting how much of their own solar production they can use, even if stored in their personal battery systems.
Critics see the decision as driven by a desire for profit protection. By restricting how multi-meter properties can consume electricity from their own systems, the CPUC appears to be ensuring that utilities continue to profit. This echoes a pattern observed in the last year of rooftop solar rulemaking decisions, where the perceived protection of utility profits was prioritized.
The California Solar and Storage Association (CALSSA) expressed their concerns, stating, “It would force customers in multi-meter properties—such as renters, small farmers, schools, and colleges—to sell all of their generation to the utility at low rates and buy it back at full retail rates.”
The proposed decision is currently scheduled for a CPUC vote on September 21, 2023, and has added to the concerns of an already beleaguered rooftop solar market in California. Recently, the implementation of Net Energy Metering (NEM) 3.0 dramatically slashed compensation rates for exporting excess solar production to the grid. The move was criticized by industry experts, environmentalists, and residents as a devastating blow to residential solar.
Unfortunately, the forecasts are grim, with demand expected to fall by nearly 40% in California through the next year, according to Wood Mackenzie. The problem has been further compounded by rising interest rates, negatively impacting loan packages offered to customers.
The new proposed decision for multi-meter properties exemplifies what some see as inconsistent logic from CPUC. While NEM 3.0 was justified on the grounds that rooftop solar net metering causes cross-subsidization of rooftop solar customers by non-customers, this new ruling seems to contradict that reasoning, effectively increasing the amount of electricity being net metered. The one apparent consistency in these rulemaking decisions is their benefit to utility profits, leaving many to question the underlying motives and the future of solar energy in the state.