The Energy Institute at the Haas School of Business at UC Berkeley (Haas Energy Institute) is often cited in news stories and government reports as an ‘independent’ academic source for information about rooftop solar. The Haas Energy Institute’s director is frequently called upon to provide research for the California Public Utilities Commission (CPUC), and sits on the Board of the state’s largest grid operator, the California Independent System Operator (CAISO).
However, a closer look at the Haas Energy Institute’s funding sources, research methods and forecasts call into question their position as a reliable source of information.
This post was updated on April 14th to include more specific information about the Energy Institute’s funders.
The utility echo chamber
The Haas Energy Institute is the ivory tower voice of the anti-rooftop solar effort in California, giving the utility position the sheen of academic legitimacy.
Some organizations that should know better have chosen to align themselves with the Haas Energy Institute viewpoint. These include: the Natural Resources Defense Council (NRDC), The Utility Reform Network (TURN), Public Advocate’s Office at the California Public Utilities Commission (CPUC), AARP and utility-favored consulting firms like Energy & Environmental Economics (E3) and Verdant Associates.
Haas Energy Institute uses the utilities’ accounting tricks to vilify rooftop solar
The Haas Energy Institute and the utilities both use the same questionable accounting methods to vilify rooftop solar. Baking these accounting methods into the work of a seemingly independent entity like Haas Energy Institute helps deceive policymakers and the media into thinking their claims about rooftop solar are based on solid math.
The math, however, falls apart on further scrutiny. Below is a summary of the accounting methods that the Haas Energy Institute uses to vilify rooftop solar. A deep dive with sources is in this white paper and in this guest post from Bill Powers of Protect Our Communities Foundation.
Using less energy is bad, according to the Haas Energy Institute
Common sense would suggest reduced energy use is beneficial for people and the planet. This is why people have been encouraged to use energy-efficient light bulbs and appliances, insulate their homes, and install solar panels on their roofs.
The Haas Energy Institute says the opposite. According to them, when solar users make their own energy and thus buy less energy from the utility, they shirk their share of grid infrastructure costs, forcing other ratepayers to pay more.
As a result, when the Haas Energy Institute does its calculations, such as in the widely cited 2021 paper, it counts all of the energy that solar users produce and use at home as a “cost” to other ratepayers. This, they conclude, is the “cost shift”.
Haas recently doubled down on this position, posting an article making the case for the proposed solar tax, using the aforementioned 2021 paper as evidence.
By wrapping their premise in an academic paper, the Haas Energy Institute gives the appearance of a sober assessment of the facts. But the actual facts, and common sense, tell a different story.
Should we tax your clothesline while we’re at it?
The Haas Energy Institute’s position is similar to arguing that households that dry their clothing with a clothesline to reduce the use of their electric dryer are forcing other households to pay more for electricity. It also flips a standard principle of ecology on its head, suggesting that reducing one’s burden on society’s infrastructure is negative and should be penalized.
Rooftop solar saves everyone money
It would be one thing if the real-world evidence supported this point of view. But it just doesn’t add up. Consider:
1) Solar users pay for grid infrastructure through a minimum bill, deductions to their solar credit and through the energy they buy when the sun isn’t shining.
2) Rooftop solar is helping to reduce the need for billions of dollars in grid infrastructure spending. In 2018 alone, the state canceled $2.6 billion in long distance power line projects because of rooftop solar and energy efficiency. And the most detailed energy modeling ever done found that more rooftop solar and battery storage can cut $120 billion in grid costs over the next thirty years – a savings of $300 per ratepayer per year. For an even deeper dive, see this presentation by the Clean Coalition and Protect Our Communities Foundation.
Rooftop solar’s benefits should be counted only when we want to count them, according to the Haas Energy Institute
Here’s another problematic accounting method used by Haas:
Typical energy planning calculates the benefits of an “energy asset” over the asset’s entire lifetime. An energy asset can be a power plant, a wind turbine, or a rooftop solar system.
The lifespan of a rooftop solar system is typically twenty to twenty-five years. That means we should calculate the benefits and costs of each rooftop solar system over that time period.
But that’s not what the Haas Energy Institute does in its research. Instead, the research only counts a single year of rooftop solar’s benefits, further adding to their conclusion that rooftop solar creates a “cost shift”.
This method not only shortchanges the true value of rooftop solar in each year, but also provides an incomplete picture of rooftop solar’s savings over time.
Haas has been wrong before. Is anyone watching?
The Haas Energy Institute is led by an individual who has a track record of making incorrect energy predictions. Consider:
- 2012: When they predicted that more renewable energy will increase our use of fossil fuels. They were wrong.
- 2012: When they said solar is a bad bet for homeowners. They were wrong.
- 2013: When they predicted that the million solar roofs initiative would not succeed. They were wrong.
- 2013: When they predicted that that legislation to redesign rates would cause only slight rate hikes for low-income consumers. In fact, the legislation increased low-income rates by 48% in just three years. More detail on pp. 8-9 of this Protect Our Communities Foundation paper.
The Haas Energy Institute’s track record of inaccurate forecasts begs the question: why do the media and policymakers continue to treat Haas as an unimpeachable source?
Haas Energy Institute takes money from utilities. We think that matters.
We do not think it is a coincidence that the Haas Energy Institute uses the utility playbook and talking points to diminish the value of solar. Here’s one reason why: The Haas Energy Institute lists PG&E, SoCal Edison and San Diego Gas & Electric among its financial backers.
A public records request to UC Berkeley found that the Energy Institute received $223,500 in donations from these three utilities between 2018 and 2021. Over a similar period, the Energy Institute received over $1 million from the CPUC, over $500,000 from the CA Air Resources Board and over $300,000 from the CA Energy Commission (see the full public records request).
So you have the government literally paying the Energy Institute to advise them at the same time Energy Institute is taking money from the utilities. This suggests a serious conflict of interest.
California policymakers and the media: Look under the hood!
It is likely that the Haas Energy Institute’s Berkeley affiliation, and a parade of impressive degrees and credentials, cause many to assume that their work is unassailable.
But smart people can be, and have been dangerously wrong. It’s time for policymakers and opinion-shapers to expand their Rolodex of experts, and start viewing the work by the Haas Energy Institute with a more critical eye.