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A Brief History of California’s Solar Agreement, Net Energy Metering

Policy
Solar contractor installing a panel on a roof

As we see the devastating effects of climate change across the globe, most recently in Texas where communities were suffering in freezing temperatures without water or power for days, it has become clearer than ever that we need to transform our power supply to renewable energy in order to increase resiliency. This past summer, California experienced the opposite, where sky high temperatures and demand for air conditioning resulted in rolling blackouts for California residents. In a time where it is crucial to increase the deployment of renewable energy, the United States’ largest solar market, California, is under attack. What happens in California will likely be the example for other states, and this is a crucial battle that we’re on the front lines of right now. 

The success of rooftop solar relies heavily on net energy metering (NEM), a solar producer’s agreement with the electric utility company. At a high level, NEM is a billing structure that allows solar customers to sell their excess electricity back to the grid. The amount is then applied to their utility bills, leaving the solar customer to pay the net amount of energy used. California’s first solar agreement, known as NEM 1.0, was extremely successful and accelerated the transition to solar for California residents, businesses, schools and municipalities. Since then, investor-owned utilities (IOUs) across the state have continuously attacked rooftop solar, proposing egregious policies that would make solar economically infeasible. In 2016 the second solar agreement rolled out initially in the San Diego Gas & Electric utility territory, and made its debut for Pacific Gas & Electric (PG&E) and Southern California Edison in 2017. This successor tariff is known as NEM 2.0, and after a tough battle against the utility companies, the California Public Utilities Commission decided that the new solar rate would be similar to the first, maintaining the major benefit of allowing customers to sell electricity back to the grid at retail rates. However, NEM 2.0 required all solar customers to transition to a time-of-use (TOU) rate and non-bypassable rates. Under a TOU rate, a customer is charged different rates based on the time of the day with designated on peak and off peak times. The highest rates are during peak demand, which is late afternoon and early evening, while off peak times occur early in the morning and late at night and have the lowest cost. The new rate structure under NEM 2.0 has serious implications for solar customers, because it changes the value of the energy sold to the grid based on the time. This means that in order to get the highest NEM credits, customers need to sell the bulk of their energy during peak hours. Although NEM 2.0 is substantially less beneficial to solar customers compared to its predecessor, it still retained the major benefits of being able to sell energy back to the grid. Solar companies even began to adapt to TOU rates by designing solar systems to face west in order to capture the maximum energy possible during the late afternoon. Now, California’s IOUs are attempting to make modifications to net metering, ushering in NEM 3.0. 

As details of NEM 3.0 continue to unfold at the California Public Utilities Commission, it is clear that the IOUs are calling for drastic cuts to NEM. The California Solar and Storage Association (CALSSA) estimates that the economic value of going solar will be reduced by 50-75 percent with the IOU’s proposed changes. Decisions made during these proceedings will not only affect new solar customers, but existing customers as well as the IOUs have proposed removing grandfathering periods for current customers, essentially forcing all solar customers onto NEM 3.0. 

With the understanding that NEM 3.0 could kill rooftop solar and that California is a leader and looked to as a model for shaping renewable energy programs, it is not an understatement to say that we are fighting to save solar. We are calling on organizations to sign this net metering letter and individuals to sign this petition, by early April, which will be sent to Governor Gavin Newsom and the California Public Utilities Commision. 

Our founder, Tara Hammond, began a small local coalition to save rooftop solar in California last year and the coalition has quickly grown to a statewide grassroots effort, with more than 70 organizations being involved. To learn more or to join the battle, please reach out to our Climate Justice Policy Advisor, Karinna Gonzalez at karinna@hammondclimatesolutions.com.

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Photo of solar advocates at a rally in front of a large inflatable monopoly man

Local Climate Activists Defeat Special Interests in David vs. Goliath Battle

Local climate activists that took on special interests in a statewide David vs Goliath battle have won, protecting rooftop solar and climate resiliency in California. San Diegans grew a statewide coalition to oppose Assembly Bill 1139, which failed to garner enough votes to pass through the assembly this year.

Today, California Assembly Bill 1139, nicknamed the “anti-solar” bill, has failed after unsuccessfully garnering enough votes to leave its house of origin, the assembly, by the deadline.  Community leaders, climate justice advocates, school and teacher unions, nonprofits and residents have been working to build opposition to Assembly Bill 1139 since the bill was introduced by San Diego Assemblymember Lorena Gonzalez in February of this year. 


Assembly Bill 1139 would have devastated the economics of going solar in California, threatening thousands of solar jobs and billions of dollars of economic benefits across the state.  The bill would have hurt working families, schools, small businesses, community centers, municipalities and nonprofit organizations, while making solar inaccessible to low-to-moderate income families.  By eroding the economics of going solar, Assembly Bill 1139 would have also increased environmental injustices from fossil fuels while accelerating the climate crisis, which often impacts communities of concern first and worst. 


Assembly Bill 1139 was introduced to the full assembly for a vote yesterday, on June 2, and the bill was 16 votes shy of the 41 votes needed to pass the bill out of the assembly.  The bill was then asked to be reconsidered for a vote later that afternoon, and again, it failed to receive enough support to pass.  Today, the bill was moved into the state legislature’s Inactive File, meaning Assembly Bill 1139 will not be voted on again during this year's legislative session, but it could be reintroduced in January of 2022. 


“We are thrilled to see that assemblymembers, especially locally, were able to see past the false equity narrative that utilities have been attempting to push for years and stood up for rooftop solar,” said Karinna Gonzalez, Climate Justice Policy Advisor with Hammond Climate Solutions, which spearheaded the statewide effort to oppose this bill with the Solar Rights Alliance and help from local partners.  “This bill would have had devastating impacts, not only for solar customers, but also for jobs and the climate. Looking forward, we hope to continue to work with elected officials locally and statewide to expand solar access to communities of concern.” 


This landmark vote comes after climate justice advocates rallied at the South Chula Vista Library yesterday to call on California state representatives to vote no on California Assembly Bill 1139.  Speakers at the event included Maleeka Marsden with San Diego Green New Deal Alliance, Sonja Robinson with Protect Our Communities Foundation, Matthew Vasilakis with Climate Action Campaign, Karinna Gonzalez with Hammond Climate Solutions and Ian Lochore with Baker Electric Home Energy, a local union contractor and member of the California Solar & Storage Association, the statewide association that mobilized its industry to oppose this bill. 


After yesterday's event in Chula Vista, newly-elected Assemblymember Dr. Akilah Weber, representing California's 79th Assembly District, changed her vote from ‘yes' to abstaining.  Aside from the bill’s author, none of San Diego County’s six assemblymembers voted in support of this bill. 


“I am so grateful to the activists that bravely stood up to special interests and spent countless hours opposing this bill to help protect our vision of a just, livable future,” said Tara Hammond, founder and CEO of Hammond Climate Solutions, who gave a special shout out to SanDiego350, Climate Action Campaign and Protect Our Communities Foundation for their help defeating this bill. “This is a testament to the power of the people and recognition that Californians overwhelmingly support rooftop solar as a key climate solution.  We would like to prioritize helping communities of concern adopt solar and storage, becoming local resilience hubs, and we’re glad that opportunity wasn't taken away by Assembly Bill 1139.”  


San Diego has been ranked the top solar city in America numerous times, in terms of solar capacity and number of installations.  While San Diego is currently ranked second, it’s home to hundreds of local solar companies that employ thousands of local residents and provide over a billion dollars in economic benefits to the region each year.  Local nonprofit organizations Center for Sustainable Energy and GRID Alternatives are administrators of the Solar on Multi-Family Affordable Housing program, which offers state rebates for affordable housing to receive subsidized solar power systems.  These administrators were also in opposition of Assembly Bill 1139 due to the negative impact it would have had on current and future affordable housing solar projects in the region and statewide. 


Today’s news is a big win for local climate activists and green jobs since it means rooftop solar will continue to expand, furthering access to solar for communities of concern.  It also helps keep California on track to reach critical climate targets that are set across the state. 


“The fact that Assembly Bill 1139 did not pass is a huge cause for everyone to celebrate,” said Maleeka Marsden, Chair of the San Diego Green New Deal Alliance and Co-Director of Policy at Climate Action Campaign, two of 30 local organizations that came out in opposition to Assembly Bill 1139 among 150 statewide organizations.  “If Assembly Bill 1139 had passed, we would have gone backwards, not forwards, towards meeting critical climate goals and advancing equity.” 


This outcome surfaced at a time when California is seeing an exponential rise in detrimental consequences from the climate crisis and environmental racism.  A recent report authored by Daniel Kammen, Teenie Matlock, Manuel Pastor, David Pellow, Veerabhadran Ramanathan, Tom Steyer, Leah Stokes and Feliz Ventura show that climate change is occurring at a faster, more destructive rate than previously known, requiring California to accelerate statewide climate efforts.  One of the report’s key findings concluded that a dangerous level of climate change, determined by an average temperature increase of 2.7℉, will be reached as early as 2027.


“While we’re relieved the Assembly scrapped this bill, we know that SDG&E and PG&E will continue to follow the utilities playbook in attacking rooftop solar,” said Masada Disenhouse, executive director of SanDiego350. “That’s why we will remain vigilant and committed to fighting those attacks and to working in our communities to develop innovative, equitable solutions to get to zero carbon."


There is interest among local activists and those in the clean energy industry to reform the investor-own utility model, which incentivizes the utility companies to build more infrastructure, guaranteeing a return on investment for the shareholders at ratepayers’ expense. Instead, activists would like to see solar for renters, community solar programs and other investments that address equity and help move the region toward zero carbon. 


To learn more about Assembly Bill 1139 visit www.HelpCleanEnergy.org.


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Image of a tree in the forest

Earth Day 2021: A Look Back into History, a Look Forward into Our Future

This year, April 22nd marks the 51st EarthDay, a holiday celebrated by folks all over the world. It started in 1970 as a“teach-in” by Senator Gaylord Nelson of Wisconsin, who took action to shed light on the lack of attention given to the environment by American media and politics. It had been eight years since Rachel Carson published Silent Spring,over a year since the disastrous oil rig leak off the coast of Santa Barbara and less than a year since the Cuyahoga River caught on fire from industrial toxic spills.[1] Since that first Earth Day in 1970, April 22nd has become an annual time to celebrate,protect and advocate for the planet.

This year, April 22nd marks the 51st EarthDay, a holiday celebrated by folks all over the world. It started in 1970 as a“teach-in” by Senator Gaylord Nelson of Wisconsin, who took action to shed light on the lack of attention given to the environment by American media and politics. It had been eight years since Rachel Carson published Silent Spring,over a year since the disastrous oil rig leak off the coast of Santa Barbara and less than a year since the Cuyahoga River caught on fire from industrial toxic spills.[1] Since that first Earth Day in 1970, April 22nd has become an annual time to celebrate,protect and advocate for the planet.

For some, Earth Day is a time to reconnect with nature and feel gratitude for being supported by such a resilient macro-organism that provides us with the essential elements we need to survive and thrive. Butfor many, Earth Day is also an increasingly urgent reminder of how little has changed over the past five decades, and how much needs to be done to ensure a just and livable future can prevail on this planet.

But it wouldn’t be wise to try to chart the course of our future without reckoning with our past. Indigenous peoples are the original caretakers and inhabitants of the land, yet their voices have been silenced, their land has been stolen, their subsequent treaties with the U.S.have been violated and their autonomy has been oppressed. They, along with Black, Asian American, Pacific Islander, Latinx and other communities of color have been disproportionately suffering environmental injustices[2] from systemic racism through oppressive policies, practices[3] and institutions.

It is clear that white-centric and westernized environmentalism is not the answer. The folks who have been on the frontlines since the beginning of American history should and must be central to the path forward. Reparative actions are desperately needed to prevent further harm and try to repair the relationships that white supremacy has abused. While the recent years have been devastating and tragic in endless ways, it has woken more of us up, showing us just how much work needs to be done and how we must do it. We are amidst critical times that call for us to be thoughtful in the rebuilding, including,how we can uplift and center perspectives of communities of concern who do not have the same resources and ability to participate in decision-making processes- due to lack of time, childcare, transportation, money, Internet, ability to participate in another language, etc. - to be actively involved in self-education, advocacy and the political process. This is a result of the same systems that created climate injustices and the need for advocacy and must be at the forefront of our minds for those of us who do have the privilege to be involved advocates.

It is also clear that we need more rooftop solar, not less clean energy (see this recent LA Times article), especially for communities of concern, which are often impacted by the climate crisis first and worst impacted. We need Indigenous wisdom, knowledge and sovereignty to be central to efforts, especially conservation, agriculture and soil health. We need localized, community-centric energy independence, not shareholder-drivencorporations profiting off of the backs of ratepayers. We need reparativeactions to sufficiently address redlining, which created the environmental injustices plaguing communities of concern.

We are proud to advocate for both a national Green New Deal and a San Diego Green New Deal, helping move us to zero carbon while advocating for the climate, jobs and justice for all. We invite you to get involved as well! There are many, many other solutions at our disposal and it is up to us to speak loudly and stand strong, in solidarity with those most impacted by climate injustices, to forge the path to a more just and livable future.


[1] See “The History of Earth Day” athttps://www.earthday.org/history/

[2] See “Toxic Wastes and Race in the U.S.” athttps://www.nrc.gov/docs/ML1310/ML13109A339.pdf

[3] See NY Times Article “How Decades of RacistHousing Policy Left Neighborhoods Sweltering” athttps://www.nytimes.com/interactive/2020/08/24/climate/racism-redlining-cities-global-warming.html

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Solar rally in front of a church with a large roof mounted solar system

California Bill Proposes to Kill Rooftop Solar While the Climate Crisis Continues

One of the California’s Public Utilities Commission’s (CPUC) most watched rulemakings is the net energy metering (NEM)3.0 decision, since it will decide the future of solar power in America, as California often sets the precedent in terms of environmental policies. Net energy metering, simply put, is the policy that has made solar increasingly accessible to low-and-moderate income families, schools and other public buildings. You can visit our previous blog to learn more about NEM. While the CPUC analyzes the 17 NEM proposals that were recently submitted to determine which proposal would allow solar to grow sustainably while making sure there are no inequities as a result of the decision, California Assemblymember Lorena Gonzalez has introduced Assembly Bill 1139 (AB 1139).

One of the California’s Public Utilities Commission’s (CPUC) most watched rulemakings is the net energy metering (NEM)3.0 decision, since it will decide the future of solar power in America, as California often sets the precedent in terms of environmental policies. Net energy metering, simply put, is the policy that has made solar increasingly accessible to low-and-moderate income families, schools and other public buildings. You can visit our previous blog to learn more about NEM. While the CPUC analyzes the 17 NEM proposals that were recently submitted to determine which proposal would allow solar to grow sustainably while making sure there are no inequities as a result of the decision, California Assemblymember Lorena Gonzalez has introduced Assembly Bill 1139 (AB 1139).

AB 1139 proposes a new incentive structure that pays solar customers wholesale rates for their excess generation, has high fixed fees and breaks contracts that were signed under the previous solarrules, NEM 1 (the original solar agreement that was in phased out through out the state in 2016 and 2017) and NEM 2, the current solar agreement. The calculations from the bill in its current state are alarming - the most aggressive attack on solar to date - and provide clear data showing not only how this bill would kill the solar industry, but hurt California’s 1,200,000 solar customers while making solar inaccessible for everyone, including renters, people in communities of concern and multi-family tenants. The bill slashes economic savings from solar for low-income families by 80% and payback periods are going from 11 years to over 45 years - 20 years after the system warranty ends. The bill has subsidies set aside for helping low income families receive solar, however the proposed high fixed fees paired with ending retail credit for solar customers (meaning ratepayers get paid pennies for the clean energy they put on the grid which the utilities make millions of dollars off of),could easily result in families, businesses and multifamily tenants to be paying more to have solar than they did before getting solar! Fully-subsidized solar power systems don't pencil out under this new bill, meaning the millions of dollars of ratepayer money for low-income solar will sit idle.

The bill is sponsored by the International Brotherhood of Electrical Workers (IBEW) and the Coalition of California Utility Employees, both who usually take positions on behalf of their utility employers. If the utilities successfully kill rooftop solar, that means there will be more utility-scale solar plants in the desert, which the utilities own and profit off of, and if those new transmission lines cause fires as they have in the past, ratepayers will also absorb those costs.

Aside from the effects this bill would have on the industry, taking clean energy solutions away from Californians would also further exacerbate the climate crisis and continue the environmental racism that goes hand in hand with the continued use of dirty energy. This bill would also make it nearly impossible for California to reach 100% clean energy since the state has said that in order to reach these targets, rooftop solar needs totriple.

Last week, nearly 60 environmental, solar,climate justice, equity and other advocacy groups wrote to Gonzalez to urge her to make amendments as the bill would effectively kill the rooftop solar industry. IBEW contractors Sullivan Solar Power and Baker Electric Home Energy called in to give public testimony opposing this bill in addition to the Center for Sustainable Energy and GRID Alternatives, program administrators for the state's $1 billion Solar on Multifamily Affordable Housing rebate program.Unfortunately, these concerns went seemingly unheard even after 75+ individuals and organizations called in to express opposition and the bill passed through the Utilities and Energy (U&E) Committee.

The U&E committee’s analysis of the bill provided no real analysis of how this bill will impact jobs, low income and CARE customers, or the multifamily sector so Hammond Climate Solutions,provided a letter with our analysis and other resources with information the committee had stated they were unaware of. In summary, our letter refutes the cost shift arguments being pushed by the utilities, provides reliable studies showinghow solar can save ratepayers billions of dollars while not going solar willcost ratepayers, outlines issues with the studies paid for by the utilities,and shows that this bill will kill rooftop solar.

The bill is now headed to the Appropriations Committee where it will be voted on again. While public comment won’t be accepted,written testimony to oppose this bill can be submitted to the committee via email at approps.committee@assembly.ca.gov.  A draft comment, with talking points can be found in our toolkit.

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