NEM3 fact sheet

The PG&E / SDG&E /SoCal Edison proposal to the CPUC: A Profit Grab to kill rooftop solar, just as it is taking off in middle and working class communities

PG&E, So Cal Edison, and San Diego Gas & Electric are lobbying the California Public Utilities Commission (CPUC) to make consumer solar twice as expensive than it is today. 

This would put solar out of reach for the working and middle class, just when it is taking off.

It would also make the grid more expensive for everyone, forcing all consumers to pay $120 billion more for electricity.

The CPUC is expected to make a decision by the end of this year. 

Printable version of this fact sheet

The utility proposal to CPUC would double the cost of rooftop solar. Here's how.

  • Charge consumers between $56 and $91/month just to have solar. That’s for residential solar users. Larger solar users like schools and churches would be charged between $950 and $3,400 / month. [1]
  • Slash the credit consumers receive for surplus solar electricity sent back to the grid by 80%. This means that when a solar user shares electricity with their neighbor, the utility would charge the neighbor 25 cents for that electron while only crediting the solar producer 5.7 cents.
  • Prevent consumers from carrying forward their unused solar credits from month to month. Currently solar users carry forward their unused credits month to month for one year. This encourages solar users to make more solar energy in the summer when California needs clean energy, and consume more electricity in the winter when California is flush with energy.  Shifting to “monthly netting” would significantly reduce the value of solar for consumers. 

The utility proposal hurts working families the most

  • Just under half of all new solar is going into working and middle class neighborhoods. [2] In addition, over 150,000 solar roofs serve customers in the CARE discount program. [3]
  • Solar is increasingly serving renters. An additional 30,000 rental units serving more than 100,000 people at multifamily affordable housing projects are under development thanks to net metering. By 2030, the Solar on Multifamily Affordable Housing (SOMAH) projects will bring another 300,000 families the direct benefit of rooftop solar.
  • The solar industry supports thousands of small businesses and over 70,000 jobs. [4]

The utility proposal is premised on a utility-invented lie - the rooftop solar "cost shift". The real "cost shift" is wildfires, power outages and the long-distance transmission lines that cause them.

  • Consumers are paying an estimated $9 billion a year related to long-distance power lines. In 2021 alone, utilities are charging ratepayers $4 billion in transmission costs, a 66% increase over 2016 in PG&E territory alone. In addition, they charged ratepayers $5 billion in wildfire liability expenses in 2019 and those costs are expected to increase annually. [5]

Maximizing rooftop solar can save California consumers $120 billion over the next thirty years. That's good for consumers, but also cuts utility profits. That's what this is all about.

  • Maximizing rooftop solar could save Californians $120 billion over the next thirty years. [6]
  • In 2018 alone, rooftop solar and energy efficiency prompted the state to scale back more than 20 power line projects, saving $2.6 billion. This trend has continued since. [7]
  • Utilities get a guaranteed profit of 8-10% from every dollar they spend building and maintaining long-distance power lines. The state’s investor-owned utilities charged ratepayers nearly $20 billion in transmission line projects between 2010 and 2019 and collected more than $20 billion in profits over a similar time period. [8]

The utility proposal undermines the state's clean energy goals

The California Energy Commission estimates California will need three times as much solar to meet its clean energy goals and help fight climate change. [9] The utility proposal will stall out the rooftop solar market, and undermine the state’s clean energy goals.

The utility proposal will ensure widespread power outages for years to come

The only way to protect our communities from power outages is local solar and battery storage. Killing the rooftop solar market means annual rolling power outages with no end in sight.

Utilities care about profits, not equity

Utilities have lobbied against every major proposal to help more marginalized communities adopt solar and battery storage: affordable housing solar incentives, community solar, microgrids, on-bill financing and more. [10]

California voters oppose making changes to net metering

A new poll sponsored by the CA Solar & Storage Association and Solar Rights Alliance shows overwhelming public support for net metering. 64% are opposed to making negative changes to NEM. In addition, 7 out of 10 voters believe California should do more, not less, to support the expansion of solar energy. [11]

We should keep solar growing, and make it more equitable

The Save California Solar campaign is pushing to keep rooftop solar growing, and to make it more equitable so that millions of working class households and communities including renters have access to solar in the next few years. We are also pushing to make battery storage cheaper as a strategy to “outage proof” our communities. [12]

Printable version of this fact sheet

Endnotes

[1] Utility proposal to CPUC on March 15, 2021. Calculations based on a typical 6 kilowatt system. For the fixed charge: SDG&E residential customers would pay $91/month on average just to have solar on their roof. PG&E customers would pay $86/month; SCE customers would pay $56/month. A 250 kilowatt system would be charged an unavoidable $950 monthly fee in PG&E territory, $1,100 in Southern California Edison territory, and $3,400 per month in the San Diego area. 

[2] Neighborhood level adoption data: The Berkeley Lab: Solar Demographics Tool and Income Trends among U.S. Residential Rooftop Solar Adopters

[3] CARE data

[4] The Solar Foundation: National Solar Jobs Census

[5] CA Public Utilities Commission: Utility Costs and Affordability of the Grid of the Future ($4B in transmission costs in 2021 on p. 3; $5B in wildfire mitigation costs in 2019 on p. 60; $4.336 in 2021 transmission spending and rate of increase p. 36; 1$/$3.50 profit p. 37) 

[6] Vibrant Clean Energy: Role of Distributed Generation in Decarbonizing California by 2045

[7] See Utility Dive summary of this CA Independent Systems Operator (CAISO) 2018 report, with link to the actual report. CAISO’s most recent 2020-2021 report continued to credit rooftop solar and efficiency for reducing transmission line spending, “Load forecast growth continues to remain relatively flat, resulting in part from continued statewide emphasis on energy efficiency and behind-the-meter generation. Also, there has been no material increase in the pace of retirement of non-renewable generation as these resources continue to play a role in renewable integration and overall supply sufficiency in periods of low renewable generation output. As a result, transmission expansion planning needs continue to remain relatively modest overall given past efforts at addressing emerging reliability needs.” (p.1)

[8] CPUC’s “Utility Costs and Affordability of the Grid of the Future: The Averch-Johnson effect described on page 26; $20 billion in transmission costs from 2010-19 pp. 39, Table 11; $20B profit figure from utility 10-K filings, itemized here.

[9] California Energy Commission: SB 100 Joint Agency Report Summary, p. 10

[10] Partial list of initiatives utilities lobbied to kill or defang: Affordable housing solar incentives (AB 693 – Eggman, 2015); Low-income feed in tariff (AB 1990 – Fong); Community solar (SB 843 – Wolk, 2013; SB 43 – Wolk, 2013; CPUC implementation); Microgrids (SB 1339, CPUC implementation)

[11] Benenson Strategy Group public opinion poll of rooftop solar 

[12] Save California Solar: Building Blocks to Equitable Solar & Storage Growth