Federal subsidies have made installing solar panels on your roof more affordable over the past decade. But state-by-state rules are important too, and a potential change to California’s solar rules could hurt solar installers and developers doing business in the state.
Stocks for several of those installers fell Tuesday amid concerns that a proposal in the Golden State could scare some customers away from solar power.
(ticker: RUN), the industry leader, was down 4.7%.
Power of the sun
(SPWR) and Sunnova (NOVA), two other installers, fell 5.7% and 3.7% respectively. Solar power has cooled off this year after a very hot 2020.
On Monday, three major California utilities proposed new charges and a reduction in a key benefit for solar customers.
(PCG), Southern California Edison and San Diego Gas & Electric petitioned the California Public Utilities Commission (CPUC) to allow them to charge monthly fees to customers who have solar panels: a flat fee and an “access to electricity” fee. network “per kilowatt. For the average 5-kilowatt system in a California home, the network access charge could rise to more than $ 50 per month, and flat monthly rates would range from $ 12.02 to $ 24.10, according to the utility company.
The grid access fee alone could completely eliminate the cost benefit of solar power, says Morgan Stanley analyst Stephen Byrd, after reviewing a Sunrun presentation estimating the price for a customer in South America. California. While a bill from a traditional utility company would be $ 258 a month, Sunrun’s solar and battery storage system would cost the same customer $ 200, Sunrun’s filing says. Approximately 40% of Sunrun’s customers are in California.
And that’s not all. Utilities want to lower fees for a system known as net metering that pays solar users for the energy they send to the grid during the day. A reduction in that rate would also hurt the economics of solar power and make it more difficult to convince customers to switch from traditional utilities. The new net metering rules would be imposed on new customers, not existing ones.
The solar industry and its supporters have regressed, and the Solar Save California Coalition said that if utility companies “succeed, they would essentially eliminate the market in California as they did in Nevada a few years ago.” In 2015, Nevada cut net metering payments, causing facilities to plummet. The state legislature restored payments in 2017.
The hard line taken by utilities may herald similar struggles from other companies across the country who want people who own solar panels to pay them more money for basic grid services. Utilities have argued that it is difficult to integrate new forms of energy into the grid and that solar power owners do not pay enough for infrastructure upgrades, forcing other utility customers to pay more.
So far these are just proposals, and the solar operators have also come up with their own plans. As Byrd points out, “The CPUC has rebuffed past efforts by California utilities to impose network access fees.”
The commission is expected to make a decision later this year.
Write to Avi Salzman at [email protected]