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New Policy on the way for California’s Future Rooftop Solar Customers

Policy
Image of a large roof-mounted commercial solar system

In the earlier half of the year, local climate activists rallied to defeat California Assembly Bill 1139 nicknamed the “anti solar bill” in what seemed like a David vs. Goliath Battle, however the utility attacks on solar aren’t going anywhere soon. If you’ve been plugged into the clean energy world, you’ve probably heard about net energy metering (known as “NEM”), the agreement that allows solar customers to be compensated for the excess electricity they share with their neighbors. It is what makes the investment pay off in a relatively short period of time. 


The California Public Utilities Commission (CPUC), the entity responsible for regulating the investor-owned electric and gas utilities in California, has launched a proceeding to re-evaluate the current net energy metering program (known as “NEM2”) and to decide upon a new NEM program, which will be known as “NEM 3.0.”


A total of 17 proposals were submitted to the CPUC for consideration early this year, from parties that range from environmental advocates and climate justice organizations to solar and storage trade associations and of course, the California investor-owned utilities (IOUs). The commissioners will evaluate each proposal based on its cost effectiveness, equity, consumer protection and other guiding principles. Although the batch of proposals is diverse, there are some other factors that have the potential to derail the proceeding. 


The backbone of the proceeding is a study performed by Verdant Associates that analyzes NEM 2.0. The study is flawed in a number of ways but according to comments taken directly from the study, the study fails to take into account a number of externalities, including health benefits from reduced criteria air pollution, the social cost of carbon, out of state methane leakage and land use benefits of reduced rooftop solar as opposed to utility scale desert solar.The study also does not take into account the costs associated with providing reliability and resilience to the grid, which I think everyone can agree, is not equal to zero, as the Verdant Study indicates. Keep in mind, earlier this year the Los Angeles Times reported, How rooftop solar could save Americans $473 billion and how not installing rooftop solar could cost ratepayers $385 billion. 


Furthermore the tool being used to evaluate the cost effectiveness of each proposal is also biased against solar and actually undercuts the value of solar by two thirds compared to the 2020 version of the calculator. The Avoided Cost Calculator was developed by E3 consultants, which have contracts with the utilities and regularly put out bias materials. The CPUC has slipped this update under the radar, without thorough vetting and labeled the update as minor and despite over 7,000 public comments in opposition, the commission voted unanimously to approve the updates. 


With the odds stacked against rooftop solar, a key solution to stopping the climate crisis, reducing rates for all ratepayers and providing grid stability and resilience, it is more important now than ever to make sure we use our voices to fight against utility profits and put the focus where it should be - expanding solar access to communities of concern who bear the brunt of climate change as well as climate injustices and are spending a disproportionate amount of income on utility bills. Please visit our NEM3 toolkit for up-to-date information about the proceeding and for important calls to action.

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Nature-Based Solutions in San Diego

Nature-based solutions are actions to help protect, sustainably manage and restore natural or modified ecosystems that address societal challenges while simultaneously providing benefits for people and the environment. As the most biodiverse county in the continental United States, San Diego County is well positioned to utilize nature-based solutions. These actions can help reduce greenhouse gas emissions and achieve societal co-benefits.

Nature-based solutions aim to enhance the natural function of ecosystems to provide multiple societal co-benefits such as improved public health through cleaner air and water as well as the availability of open space, improvements to habitat for wildlife and plants, flood risk reduction and other ecosystem services that enhance the resiliency of our environment. Natural and working lands are vital in the carbon cycle in San Diego and throughout California. Healthy ecosystems that include vegetation and soil microbes capture and store carbon from the atmosphere. In contrast, changes that alter or damage ecosystems, including land use modifications, deforestation and wildfires, can release sequestered carbon back into the atmosphere, accelerating the climate crisis. To balance between carbon stored and carbon released determines whether natural lands and ecosystems function as net sources or net carbon sinks. Protection of natural environments from land use and disturbances helps promote the functioning of forests, wetlands and oceans as carbon sinks that absorb more carbon than they emit.

San Diego has initiated multiple nature-based solutions projects already. However, the need to develop and scale up these projects is ever increasing as San Diego and California face impacts of the climate crisis. The United States Economic Development Administration’s Economic Integrator helped catalyze a nature-based solution project focused on upstream improvements to reduce runoff and debris deposited into San Diego’s stormwater infrastructure. This project helps mitigate the impact of flooding in the urban center while enhancing outdoor recreation and economic development for the County. The project focuses on Maple Canyon, nestled between Balboa Park and San Diego International Airport, a green space that buffers business with nature inside the urban core of San Diego. As flooding during storm events occurs, runoff and debris impact the downstream commercial enterprises, transportation networks and natural habitats. Restoration efforts have minimized flooding and stormwater runoff, helping protect vital urban infrastructure and important urban and natural landscapes.

As a coastal city, enhancing the resiliency of our coast is vital to managing climate change impacts such as sea level rise, coastal erosion and storm surges. Coastal wetlands throughout San Diego County are essential ecosystems that not only help with flood protection but are also some of the most productive ecosystems that play an integral role in the ecology of our watershed. Coastal wetlands are also considered “blue carbon ecosystems,” which include habitats like salt marshes and seagrass meadows that help capture and store more atmospheric carbon per acre than terrestrial forests. Nature-based solutions that preserve and restore these wetlands help build community resilience to the impacts of climate change by sequestering carbon and helping enhance the resiliency to sea level rise and coastal flooding. The Blue Carbon Collaborative, founded by the nonprofit organization Wildcoast, is a network of organizations working on the conservation, research and policy developments for blue carbon ecosystems and nature-based solutions. 

Only 10 percent of California’s original wetlands remain, yet they are some of the best ecosystems on the planet for taking carbon out of the atmosphere and storing it in the ground for a long time. Restoration of these wetlands provides an opportunity to enhance these ecosystems' production and utilize their potential as a natural climate solution. Aligning nature based solutions with the 30x30 plan to conserve 30 percent of our land and coastal waters by 2030 to protect biodiversity will expand access to nature while lessening the impacts of the climate crisis.

Cover photo credit: IUCN

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Credit: Bryan Olin Dozier/NurPhoto/Reuters (found on CNN)

The Biden Administration has decided the fate of Alaska’s Northern Slopes, and it’s not good

The Biden administration has issued their decision on ConocoPhillips’ proposed Willow Project, and it's not good

The Biden administration has issued their decision on ConocoPhillips’ proposed Willow Project. In case you haven’t heard about it yet, this is a huge long-term oil drilling investment by the petroleum refinery company in the northernmost borough of Alaska that would produce over an estimated 600 million barrels of oil, and close to 300 million metric tons of carbon dioxide into our atmosphere over the next 30 years. This is equivalent to emissions from roughly 70 coal fired power plants, or from 56 million vehicles over one year –  a “carbon bomb” some have labeled – and the President has signed off on its approval.

This is a major setback in President Biden’s commitment to end oil drilling on federal land, a pledge campaigned during his 2020 election season. The Bureau of Land Management (BLM) released their final environmental impact statement last month, recommending a reduction in the number of drilling pads from five to three, and the planting of trees to offset the carbon emissions. With the increase in pushback from the public and environmental groups this past year, the administration considered lowering the scope of the project to two pads, however, ultimately stuck with three to make it economically viable. Even with the newly announced protections of the U.S. Arctic Ocean and surrounding land surface, this will not prevent the degradation caused by oil drilling.

So, what are they saying in Alaska? The conversation is rather divided in the state, with the voice of legislators seeming to dominate. Major arguments in support of this development are concerned with the potential for massive revenues, job opportunities, and domestic energy production that would benefit the state. They are looking towards the estimated $1.25 billion in taxes to fund infrastructure improvements, and another $2.5 billion for a grant program for community initiatives to frame the Willow Project as a net benefit. One coalition of Alaska Native groups has extended their support, regarding this as an opportunity to gain basic services such as education, healthcare, and law enforcement.

On the other side, previously impacted residents of past ConocoPhillips ventures urged the President to reject any form of this project. The city of Nuiqsut, the closest residential area in proximity to the proposed site of the new drilling pads, is heavily concerned about the health and environmental risks posed. Just last year, the company’s oil field at the Alpine Central Facility had a methane gas leak, eight miles away from Nuiqsut. This prompted some of the 500 residents to flee the area, and now they are worried the Willow Project will bring even more dangers.

In any case, developing the Arctic Alaska for oil drilling purposes will threaten our global atmosphere, the local wildlife of the region, and push the global ice caps beyond the point of return. Many petitions have been passed through social media to urge the administration to put an end to the project; the #StopWillow campaign on Tiktok has reached over 50 million views, landing itself on the trending page where anybody on the platform can engage with it. Environmental organizations are preparing to challenge this decision legally, and we encourage you to stay up to date on this topic as we continue the fight against climate change.

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CA’s deadline to go solar to maximize savings is upcoming

The NEM 3 decision includes a “sunset period” that ends 120 days after the approval of the final decision, meaning anyone who goes solar before the sunset period date is still eligible for NEM 2.

In case you missed it, in December 2022, the California Public Utilities Commission (CPUC) issued a decision that ended a nearly two-year long battle between the investor-owned utilities and environmental groups over the future of rooftop solar in California. Although there was a coalition over 600 strong comprised of environmental and climate change organizations, nonprofits, schools, cities, churches, businesses and elected officials who spent two years urging the CPUC to keep solar growing sustainably, as instructed by law, the CPUC ultimately decided to side with the investor-owned utilities and made significant cuts to agreement solar customers go on, known as net energy metering. You can read more about the coalition here

Under the new net energy metering (NEM) agreement (known as NEM 3), solar customers will get about 75 percent less from the utility for the clean, local and reliable excess energy they share with their neighbors (which the utilities still charge their neighbors full transmission and distribution fees for). Just to give you a sense of how the new tariff compares to what solar customers are receiving currently, compensation for energy will go from an average of $.25/kWh all the way down to about $0.05/kWh. NEM 3 customers will also be forced to go on rates that have higher rates in the evening. All in all, these changes will nearly double the time it takes to pay off a residential system.  

There is some good news.  

If you already have solar, these changes will not affect you! All NEM 1 and NEM 2 customers will continue to receive benefits until their agreement expires, which is 20 years after the system was turned on. The only scenario that would make a customer lose their current NEM status is if a customer adds additional panels that exceed the allocated amount. 

The NEM 3 decision includes a “sunset period” that ends 120 days after the approval of the final decision, meaning anyone who goes solar before the sunset period date is still eligible for NEM 2. In order to go solar and receive maximum benefits, a solar contractor must submit a completed interconnection agreement without significant errors and a signed contract by April 14, although we recommend getting this submitted as soon as possible in case there are errors that need to be resolved. The solar power system can be installed after the cutoff date, so long as the application is submitted by April 14 and it is approved by the utility, however, if any significant changes are made to the equipment being used or system size, that would trigger a new application and cause the customer to lose their NEM 2 status.    

As the proceeding currently stands, customers should be prepared to go solar by the cutoff date, April 14, in order to receive the maximum benefits, however, there is a small possibility that this decision could be reversed entirely. Last month, the Center for Biological Diversity, Environmental Working Group and Protect Our Communities Foundation filed a formal appeal to reverse the CPUC’s final decision. The appeal highlighted ways in which the CPUC violated the law. 

The first and perhaps most obvious issue is that the decision violates a California law requiring the sustainable growth of rooftop solar. The California law is very clear in stating that the new NEM tariff must “ensure that customer-sited renewable distributed generation continues to grow sustainably,” During the course of the proceeding, some commissioner’s even stated that this decision may slow rooftop solar adoption but the CPUC has to consider other issues as well. The appeal rightfully argues that this decision is not the CPUC’s decision to make, as the law is very clear. 

The second issue is that the decision violates another California law that requires the CPUC to put forward an alternative option that would increase solar in communities of concern. The current California law states that any changes to NEM must include an option that will grow solar in “disadvantaged communities.” Not only does the decision actually make rooftop solar more expensive for everyone and disproportionately impacts communities of concern, but the CPUC promises funds to disadvantaged communities that are not available unless the legislature allocates them and are only for battery storage, not rooftop solar. 

  

The overarching issue of the entire proceeding is that the CPUC completely failed to account for all of the benefits and costs of rooftop solar. Any changes to NEM should have been based on the costs and benefits to all ratepayers and the CPUC not only disregarded the benefits of rooftop solar, but also misrepresented the impacts of long distance transmission lines. The appeal claims that in disregarding evidence presented to them, they violated their own process and precedent.  

What's next? 

Although the appeal is strong in its merits, this appeal is simply administrative, meaning that the CPUC has no real timeline to respond to the appeal or make any decisions. If the CPUC fails to respond within 90 days, the organizations that filed the appeal can escalate the appeal to an appeals court, which representatives have stated is the plan. 

The appeal is strong, and has already gained support from groups like 350.org and Solar Rights Alliance, however appeals similar to this have been filed in previous CPUC proceedings and were ultimately dismissed by a court of law and the CPUC. While we should remain optimistic about the appeal, customers should still plan to follow the current deadlines on the table to ensure they don’t miss the opportunity to go solar.   

Bottom line is that if you can go solar now, we recommend it as you’ll be able to maximize your savings and start producing clean energy soon!

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