Reworked Solar Bill Fails in Committee

By Published On: August 14, 2004

A bill that could have fulfilled the Governor?s campaign promise of solar-powered homes fell on a 3-2 vote August 12 in the Assembly Appropriations Committee. Under revisions made this week to the ?solar homes? legislation, the state would have placed solar panels on half of all new houses built?with most of the ten-year, $1 billion program paid for by residential utility customers. ?The play wasn?t together yet,? said V. John White, executive director of the Center for Energy Efficiency and Renewable Technologies, adding the governor had yet to weigh in. ?This is a big idea?and it?s late.? If the measure is destined to move forward this session, White continued, it would have to be shuttled into another bill by August 20. Senate bill 1652, authored by Senator Kevin Murray (D-Los Angeles), took on an array of amendments August 10, including a five-year delay in getting the solar initiative rolling. The bill would have required that by 2010 5 percent of new homes (in developments containing at least 25 houses) include photovoltaic panels, with a 5 percent boost each year following until 2019?amounting to 50 percent of all new houses built. Governor Arnold Schwarzenegger?s office would not comment on the bill. During his campaign for governor during the 2003 drive to recall Gray Davis, Schwarzenegger called for solar panels to adorn half of all new homes built. At a meeting he held August 11 with environmental groups, he reiterated his wish that California become a leader in solar power. Regarding the expanded time frame for the solar program contemplated in the bill, White said this would have helped reduce the price of solar technology via long-term funding and greater product volume. That lower price would help keep a lid on the cost of homes sporting the panels, but small ratepayers would be saddled with an enormous tab, critics warned. Residential ratepayers would have paid $500 million over the first five years of the program. Over the final five years, costs would have been spread among all utility customers. The money would have been used to provide rebates to developers installing the panels and homeowners in possession of them, in turn spurring solar sales and advancing the field. After ten years, solar power produced during peak times would need no further subsidy, evidenced by a similar program undertaken in Japan, according to the bill. Investor-owned utilities took no position on the bill during the short time that the new amendments were in circulation. Pacific Gas & Electric spokesperson Paul Moreno noted that the utility believes solar power should figure into California?s future and that PG&E interconnected 2,000 home-based solar assemblies last year. Talk around the Capitol indicated that utilities disliked the bill because of their long-standing opposition to net metering, a component of solar self-generation. According to one of SB 1652?s provisions, ?ratepayers will recoup the cost of their investment through lower rates as a result of avoiding purchases of electricity at peak rates, with additional system reliability and pollution reduction benefits.? Earlier in the week, The Utility Reform Network senior lobbyist Lenny Goldberg bristled at the idea of small ratepayers bearing the lion?s share of solar PV costs. ?We are not happy about this,? he said. Goldberg referred to the existing self-generation incentive program. Residential customers help pay the $125 million annual cost of this initiative, though benefits are directed to utility customers using 30 kW or more. ?The argument there is that you have peak power in reserve and everyone benefits,? he said. ?The same seems to be true? for solar homes. Senator Murray?s office did not return phone calls seeking comment on the bill. Following the Thursday vote, Goldberg suggested that SB 1652 might move to an ?interim? status where the bill could be examined in depth and then reintroduced. He predicted, however, that difficulties surrounding the measure make it unlikely that it will come to a vote by August 31, the last day each house in the Legislature can pass bills. SB 1652 would have extended the self-generation program until 2015. CEERT?s White said that doing so would help support solar technology. Legislature insiders, however, called the provision ?sneaky? and questioned whether the solar industry really needs subsidies on the order of $1 billion. Capitol insiders also assailed the logic of confining the solar program to household rooftops alone and not casting a wider net, and criticized the absence of any minimum warranty requirements to be applied to the panels themselves and thus ensure a decent return on investment in the units. White dismissed speculations that the weight of the program would have fallen squarely on small ratepayers. ?That?s a small detail,? he said. ?There?s a political sensitivity given the amount of rate increases lately, but residential customers have been largely shielded? from them.

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