CPUC Expands Solar System

By Published On: December 16, 2005

The California Public Utilities Commission plans to fund rebates for new photovoltaic and solar thermal systems with $2.8 billion over 11 years. The commission is expected to vote January 12 to adopt much of the originally bipartisan Million Solar Roofs Initiative, SB 1, defeated by the Legislature. The measure implements many of SB 1’s provisions though the regulatory process. The commission version is called the California Solar Initiative. Adding “clean energy to peak demand resources” and “diversifying the state’s energy portfolio and reducing the demand for transmission and distribution systems” are the stated justifications for the subsidies. They also could promote “less expensive and more efficient technologies,” adds the commission. “This is a bargain price!” stated Rochelle Becker, executive director of the Alliance for Nuclear Responsibility. Similar capacity from nuclear plants would cost well over twice that amount and be far more risky, she added. Solar advocates lauded the move. “A long-term program with secure funding is key to bringing down solar costs,” stated Barry Cinnamon, member of the board of directors of the California Solar Energy Industries Association and chief executive officer of Akeena Solar. “California will greatly benefit from the creation of jobs,” added Carla Din, Apollo Alliance Western regional field director. In addition to the proposed $2.8 billion investment, the CPUC approved December 15 a $300 million infusion into the commission’s popular solar subsidy program. The funding is to cover 2006 rebates for the Self-Generation Incentive Program (Circuit, Dec. 9, 2005). “It is the first step to jump-start the California Solar Initiative,” said CPUC president Mike Peevey. This week’s move also decreased solar electricity buy-downs to spread the available funds to more applicants. A capacity subsidy will be $2.80/kW – down from this year’s level of $3.50/kW. The commission envisions lowering that amount annually but did not set a number. The subsidies in the proposed regulatory solar initiative will cover both residential and commercial systems up to 1 MW. Investor-owned utilities and the San Diego Regional Energy Office will administer program funds. Ten percent of the subsidies are to be earmarked for low-income residential customers and housing projects. The proposed decision notes that solar installations are still no match for the dollar efficiency of conservation retrofits. However, it stops short of requiring energy-efficiency measures prior to granting solar subsidies.

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