Will California count rooftop solar in portfolio standard?

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When California legislators vote to increase the state’s renewable energy portfolio standard to 50 percent by 2030, will rooftop solar count toward the total?

When California legislators vote to increase the state’s renewable energy portfolio standard to 50 percent by 2030, will rooftop solar count toward the total?

Many will be surprised to learn that rooftop solar doesn’t currently count toward utility companies' quota requirements.

And many others will be surprised to learn that utility companies are aligned with rooftop solar installers on the issue. Both believe rooftop solar should count toward California’s ambitious new renewable energy portfolio standard if legislators do as they are expected and increase the standard from 33 percent by 2020 to 50 percent by 2030.

Over the last few years, it’s rare that rooftop solar advocates and utility companies are on the same page about anything. And once the first layer of this debate is pealed back, it’s hard to say if they’re really seeing eye to eye on this one either.


Why rooftop solar advocates want to count

Rooftop solar proponents say distributed generation should be counted and should play an obvious role in California’s renewable energy future.

Beyond the ideological value of being recognized for its contribution, rooftop solar should be counted so it will get the advantages that come with counting, advocates say. California’s net metering law currently requires utilities to credit consumers with rooftop solar systems at the retail rate for excess power they freed onto the grid. That law will be revisited at the end of 2015 and no one expects the next policy to be as generous to distributed generation as the current policy.

If rooftop solar counts toward utility portfolio requirements, utility companies are likely to offer rebates and incentives to home and business owners who install solar energy systems. That could be particularly important to the rooftop solar industry, which has seen massive growth over the last four years, at a time when the state net metering benefit diminishes and the federal income tax credit evaporates.


Why utilities want rooftop solar to count

Utility companies want to be able to count the distributed generation that feeds their grids against their portfolio requirement for one simple reason – money. If distributed generation doesn’t count, companies will have to invest in more utility-scale renewable energy infrastructure than if rooftop solar does count against the total.

Utilities will also likely hit their caps much faster if they can count distributed generation, particularly because rooftop solar is growing so fast.


So, who doesn’t want to count rooftop solar?

Utility-scale solar companies and union labor is adamantly opposed to counting rooftop solar against an increased renewable energy portfolio standard. The reason is simple. There will be less demand for utility-scale solar if distributed generation counts against the portfolio standard. Historically, the portfolio standard has driven investment in large-scale solar projects, which also tends to use a lot of skilled and organized labor.

Some conservative groups also oppose counting rooftop solar, presumably because distributed generation is the biggest threat to the future of monopoly utility companies and their investors.


Should they or shouldn’t they?

If California doesn’t count rooftop solar, it might make it harder for small-time installers. But it also means California is likely to end up with far more than 50 percent of its energy coming from renewable energy sources.

Then again, wouldn't California just make a new goal once it got close to meeting this one?