Tensions Flare as California’s Solar Industry Waits for Key Ruling on Community Solar Market

Debate continues to simmer in California as to what
role community solar projects will play as part of the state’s new
building codes that
require solar installations on all new homes
, which
went into effect
at the start of this year.

Sacramento is ground zero for the tension, as hometown municipal
utility Sacramento Municipal Utility District (SMUD) works to
persuade regulators at the California Energy Commission to approve
a program called SolarShares that it considers community solar. But
the solar industry has pushed back on the SolarShares
program, arguing that it would set a poor precedent for the
state’s largely undeveloped community solar market.

In January, SMUD submitted a
new proposal
that incorporates some of the changes the solar
industry called for: rather than relying on utility-scale
resources, including one project located far away in Fresno County,
SMUD will only draw electricity from projects in its service
territory; projects for the program will come in under 20
megawatts; the utility will double the savings available to
subscribers, from $5 per kilowatt each year in its original
proposal to $10 per kilowatt per year; and SMUD will add new
resources rather than relying on existing projects.

The commission plans to take up the new proposal at a February
20 meeting. Commission staff have recommended its
approval. SMUD’S changes have also gotten some solar and
environmental allies on board, including the Coalition for
Community Solar Access (CCSA).

“SMUD addressed a lot of the concerns that we raised,” said
Charlie Coggeshall, CCSA’s policy lead in California and Oregon.
“We’re not calling it the gold standard, but at the same time I
think it’s hard for us to push back any further just based on the
amount of concessions they made.”

That feeling is not universal within the solar industry,
however. Tensions between SMUD and parts of the solar industry
were clear at a recent event hosted by the Solar Energy Industries
Association (SEIA) and the Smart Electric Power Alliance.

‘So much animosity’

Onstage, Wade Hughes, manager of SMUD’s green energy and
carbon offset program, claimed “there’s a lot of debate around
what the word community solar actually means.” But Rick Umoff,
SEIA’s California director, challenged that assertion, noting
that a definition has coalesced around “key attributes” like
distribution-level benefits and additionality — qualities the
original SMUD proposal lacked.

“We’re a little concerned that, at least here in California,
there has been sort of a blurring of the lines” about what
constitutes community solar, Umoff said onstage at the event. After
a tense exchange over renewable energy credits, in which Julia
Zuckerman, head of external affairs for the West at developer
Clearway Energy, also suggested SMUD’s program didn’t meet some
of the fundamentals of community solar, the session ended with
Hughes lamenting the squabbles over SolarShares.

“It’s a shame that there’s been so much animosity,” said
Hughes. “It’s a shame that there’s been of late a lack of
cooperation, a lack of collaboration and the people we have thought
of as our strongest allies somehow find it within themselves to be
on the other side.”

Builders in California argue that homebuyers need another
option than paying for a residential solar system upfront. But the
solar industry worries that the approval of a less-than-ideal
program could undercut California’s entire community solar market
before it has a chance to take off. 

California’s community solar market on the line?

The battle over SMUD’s program — which would only apply to
the utility’s 1.5 million customers in a state with more than 150
million ratepayers — comes down to greater concerns about the
future of California’s community solar market and what role it
will play in the state’s ambitious climate and clean energy
goals. If SMUD’s program is ultimately approved by regulators,
similar alternatives are likely to pop in other parts of the
state.

Though California easily ranks atop all states for both
distributed and large-scale solar, community solar markets in
states such as Minnesota and Massachusetts — with 722 and 328
megawatts in place, respectively — dwarf California’s 144.4
megawatts of installations.

Several solar advocates, including Vote Solar and the Solar
Rights Alliance, called for more extensive changes from SMUD in
comments submitted to the commission last month.

Specifically, Vote Solar wants SMUD to more directly engage with
disadvantaged community groups in its service territory to help
make decisions about solar projects. The Center for Biological
Diversity, an environmental group, said the credits associated with
the program are “still woefully low” and are not equivalent to
the benefits of rooftop solar. 

Coggeshall at CCSA said in an ideal world his organization would
like to see further tweaks to SolarShares, but said additional
changes are unlikely. “I don’t think the CEC will have the
appetite for that,” he said.

The process to approve the program has already extended beyond
when the mandate went into effect, leaving homebuilders without an
alternative compliance mechanism for now (though many pulled
permits before the year began, thus extending their timeline).

Numerous homebuilders and builder organizations have lined up in
support of the revised program, along with other municipal
utilities, the Northern California Power Agency, the American
Institute of Architects California and the Natural Resources
Defense Council.

Source: FS – GreenTech Media
Tensions Flare as California’s Solar Industry Waits for Key Ruling on Community Solar Market