California: Net-metering works

15. January 2013 | Industry & Suppliers, Markets & Trends | By:  Shamsiah Ali-Oettinger

A study commissioned by the Vote Solar Initiative has found that net-metered rooftop solar has the ability to provide more than US$92 million in annual benefits to ratepayers of California's three investor-owned utilities.

The infographic by Vote Solar Initiative shows why net metering works in California.

Net metering is a program that provides rooftop solar customers with utility bill credits for the surplus clean energy that their solar systems feed onto the electric grid and has been a key driver of the rapid expansion of solar across California's rooftops, with two-thirds of home solar installations now occurring in low and median income neighborhoods.

The study comes as the state's investor-owned utilities, Pacific Gas & Electric (PG&E), Southern California Edison (SCE), and San Diego Gas & Electric (SDG&E), increasingly criticize net metering, which reduces their ability to justify the capital investment infrastructure projects that earn them a guaranteed profit. The study shows that net metering’s benefits to the ratepayers of those utilities outweigh the costs: the benefits to ratepayers in SCE, PG&E, and SDG&E territories will total more than $90 million every year by the time the state’s net metering program is fully subscribed at 5% of peak demand.

The infographic generated by the initiative shows:

  • Utilities overstate net metering credits by as much as 40%.
  • Utilities overstate the amount of solar power impacting the grid by as much as 80%.
  • Utilities claim there are almost no cost-saving benefits of net metering.

These in turn lead to overinflated cost claims according to the initiative study. The study has now made it clear that net metering actually works for California.

"When someone decides to put solar panels on their roof, they not only generate clean power, but also reduce strain on the electric grid while offering financial benefits to all ratepayers," said Adam Browning, Executive Director of The Vote Solar Initiative. "We've got a long way to go in revamping an antiquated energy grid and growing California's clean economy, and net metering is critical to those efforts."

The study was commissioned by the Vote Solar Initiative and was authored by consultant and former California Public Utilities Commission advisor Tom Beach of Crossborder Energy. Using a CPUC-approved economic model and data from solar customers, the study assesses the overall impacts of net metering to ratepayers in territories covered by Pacific Gas & Electric, Southern California Edison, and San Diego Gas & Electric.


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