BILL ANALYSIS
AB 510
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 510 (Skinner)
As Amended January 26, 2010
Majority vote
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|ASSEMBLY: | |(June 1, 2009) |SENATE: |27-5 |(February 11, |
| | | | | |2010) |
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(vote not relevant)
Original Committee Reference: HUM. S.
SUMMARY : Increases a cap on the amount of solar or wind
generated electricity that can be generated under the net-energy
metering program from 2.5% to 5% of each utility's aggregate
peak demand. Requires a licensed contractor to inspect existing
solar or wind generating facilities when a customer generator
wants to enter the facility into a new net-energy metered
tariff.
The Senate amendments delete the Assembly version of the bill
and instead:
1)Increase from 2.5% to 5% the percentage of an electric
utility's peak load that may be provided by customers
operating solar or wind systems under a net-energy meeting
tariff.
2)Provide that any customer with an existing electrical
generating facility and meter who enters into a new net-energy
meter contract shall provide an inspection report to the
electrical corporation, unless the electrical generation
facility has been installed or inspected within the previous
three years.
EXISTING LAW :
1)Creates the California Solar Initiative (CSI), a $3.3 billion
declining rebate program to offset the cost of installing
solar panels on homes, businesses, and public buildings. The
program requires that in order to be eligible for CSI rebates,
among other requirements, the solar energy must be intended to
primarily offset part or all of the consumer's own electricity
demand (the panels cannot produce more electricity than the
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customer's historic peak demand).
2)Requires investor owned utilities (IOUs) and most publicly
owned utilities to offer customers with solar or wind
generation that is no larger than 1 megawatt in size, a
net-metered tariff where the customer can sell back
electricity produced from the solar or wind facility that
exceeds that customer's demand at that moment in time as a
kilowatthour (kWh) bill credit against electricity that the
customer receives from the utility when their renewable
facility produces less than the customer is consuming.
3)Caps the total amount of solar and wind generation that can be
subject to net-metering at 2.5% of each electric utility's
aggregate peak demand.
AS PASSED BY THE ASSEMBLY, this bill altered eligibility
requirements for California Work Opportunity and Responsibility
to Kids (CalWORKs).
FISCAL EFFECT : Minor absorbable costs to the Public Utilities
Commission (PUC).
COMMENTS : According to the author, the purpose of this bill is
to remove unnecessary barriers to meeting the goals of CSI.
Net-metering is an important piece of the overall financing of
rooftop solar, without net-metering few solar installations
would be economically viable.
Under net-metering, the electric utility is required to "buy
back" any electricity generated by a customer-owned generator as
measured by an electric meter that can measure the flow of
electricity in both directions. When the customer generates
electricity, he/she uses most of it for his or her own facility.
Any excess electricity passes through the meter and is
distributed to the electricity grid. At the end of the year,
the electric corporation calculates the amount of electricity
distributed to the grid by the customer and reduces the
customer's annual bill by the amount of electricity generated by
the customer. This results in the utility "buying" the excess
power and paying for it in the form of a bill credit.
Utilities currently only have to offer net metering until the
load served by net-metering represents 2.5% of the utilities
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total load. The cap was set in SB 1 (Murray), Chapter 132,
Statutes of 2006. SB 1 implemented CSI which has the goals of
installing 3,000 megawatts (MW) of distributed generation sized
solar energy system in California by 2017, while creating a
self-sustaining solar industry that can operate without
subsidies. If the goals of CSI are to be met, the 2.5% cap on
net-metering must be increased or a similar buy back program
must be put into place.
The bill also contains a provision that requires solar and wind
electrical generation facility on existing homes or business to
be inspected by a licensed electrician when the home or business
is sold and the new owner wishes to continue to have the
generation facility net metered.
The sponsor of this bill, Solar Alliance, and other supporters
believe that since CSI has been successful and net-metering is a
key part of that success, the cap on net metering should be
eliminated entirely or increased to a level that exceeds the
3,000 megawatt goal of CSI this year.
TURN (originally called Toward Utility Rate Normalization) is
also opposed to increasing the cap at this time, unless the cap
increase is coupled with other changes to the net-metering
program that TURN believes will help ensure that the
non-customer generator ratepayers receive some benefit from the
subsidy. Specifically, TURN would like to change current rules
that provide that the customer generator owns all of the
Renewable Energy Credits (RECs) associated with that generation,
even for electricity that is sold to the utility.
Analysis Prepared by : Edward Randolph / U. & C. / (916)
319-2083
FN: 0003674