California to Miss Deadline in Setting Solar Net Metering Payments

California utility regulators won’t meet a year-end deadline on deciding how much residents should be paid for power from their rooftop solar panels under the state's net metering program, the state’s chief regulator said.

The California Public Utilities Commission is weighing extensive comments and proposals before issuing a proposed decision, agency president Michael Picker, 63, said in an interview at Bloomberg’s San Francisco office on Thursday. While that initial decision may be made before the end of the year, a final one won’t meet the deadline, he said, citing the contentiousness and litigious nature of the case.

Utilities and renewable energy developers have been closely watching the case in California, the nation’s largest rooftop solar market, as a bellwether of how the rest of the country will deal with the rapid emergence of power being generated by customers. Rules that allow for the sale of this energy, known as net metering, have been adopted by 46 states and have become the single most important driver of growth for the rooftop solar business, according to Sanford C. Bernstein & Co.

“I wish we could do it” by the end of this year, “but how do you get the lawyers to shut up?” Picker said. “We all learned in high school that, if you want to build a crowd, start a fight.”

California Bill

California Governor Jerry Brown signed a bill two years ago that required the utilities commission to come up with a standard tariff for customers who supply power from renewable energy resources by Dec. 31.

PG&E Corp. and Edison International’s California utilities have asked the state to increase fees and cut payments to power-generating customers, arguing that customers who don’t have solar shouldn’t subsidize those who do. They’ve also said the program needs to better reflect the value of the power and the cost of upgrading the grid to handle it.

Rooftop solar installers including SolarCity Corp. and Sunrun Inc. say the utilities’ proposals threaten to undermine the economics of their systems.

Solar customers would still save between 30 percent and 50 percent on their monthly electricity bills under PG&E’s plan, the utility said. The net impact of the changes proposed by PG&E would be between $13 and $29 monthly for a typical prospective solar customer planning to install a 3-kilowatt solar system, the company said.

©2015 Bloomberg News

Lead image: Deadline clock. Credit: Shutterstock.

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