Around two million California rooftop solar owners could lose energy credits that would help cover what they spent installing expensive climate-friendly systems under the proposed state bill.
Congress member Lisa Calderon (D-Whittier), author of the bill, is a former executive at Southern California Edison and its parent company, Edison International. She says the credits that rooftop owners receive when sending unused power to the grid are raising invoices for customers who don’t own the panel.
Her bill, AB 942, limits the profits of the current program to 10 years. This is half the 20-year period the state receives to rooftop owners. Also, if the house is sold, the bill will cancel the solar contract as well.
Edison in Southern California and two other large commercial utilities in the state have sought to cut down the energy credits that Californians encouraged to invest in solar panels. The rooftop solar system has been reduced to utility power sales.
The laws that apply to those who purchased the system by April 15, 2023 have infuriated Californians who invested tens of thousands of people to install solar panels.
“Are you punishing me for just trying to cut our carbon footprint?” Huntington Beach resident David Linnerson said he spent $20,000 on installing the panel. “It’s just ridiculous.”
Before she was elected in 2020, Calderon spent 25 years at Edison and Edison International in Southern California. Her final position was Edison International’s Office of Government Affairs, administering the Utility’s Political Action Committee.
Calderon refused to interview him. In a statement, she said she was not acting on behalf of the utility company.
“I introduced this bill with this in mind, and it will help reduce energy costs for Californians,” she said.
Calderon said if her bill is enacted, it would reduce electricity costs for customers who have not owned the panel from 2026.
The utility, owned by Edison in Southern California and two other big investors, is one of Calderon’s most generous corporate donors, according to Opensecrets.org, which tracks political spending.
Last year, the company gave Calerdon’s campaign $11,000. San Diego Gas & Electric’s parent company Sempra also donated $11,000, while Pacific Gas & Electric provided $8,000.
Kathleen Dunleavy, a spokesman for Edison in Southern California, said the company supports rooftop solar, but also supports efforts to reduce costs that have shifted to customers who do not own panels.
She said the company’s political contributions to elected officials are “based on its best interest in safely serving SCE customers, a reliable and affordable energy.”
In a statement to the Times, Calderon said “political contributions have nothing to do with the policy decisions I make.”
Calderon is a member of a political dynasty that has held power for 40 years in the Blue Collar District, east of Los Angeles.
She is married to Charles Calderon, a former state legislator and former Senate majority leader. She was elected to the Congressional seat held by her son-in-law, Ian Calderon.
Under California’s rooftop solar program, owners get electricity bill credits for solar energy that they produce but don’t use. Credits are based on current retail electricity bills. The value of the credit has increased rapidly as the fees requested by businesses approved by the state Utilities Commission.
In December 2022, the large utility company successfully pushed the committee to reduce the financial incentives that rooftop solar owners could receive about 75%, starting with people purchasing the system on April 15, 2023.
The committee had enforced the program for owners who purchased the panel by that day. The agency says the value of the credit given to these owners is currently the leading cause of the state’s rising electricity bill. This is an argument being contested by the rooftop solar industry and dozens of environmental groups.
In a February report to Gov. Gavin Newsom, the committee proposed that as a relief for rooftop solar owners to increase electricity costs, the number of years that rooftop solar owners can receive credits on retail electricity bills, similar to Calderon’s bill. California currently has the second highest electricity bill in the country.
The committee says that costs will be shifted to those who do not own the panel as rooftop customers don’t donate an equitable share of costs to maintain the electric grid.
A dozen environmental groups this month wrote to the chairman of the Congressional Utility & Energy Committee opposed to Calderon’s bill, saying the state will have a long solar contract lasting for 20 years. This is the expected useful life of the panel.
“It would be patentably unfair to break the midstream energy contracts for a new proposal,” the group wrote. “It will punish those who encouraged California to invest in solar energy, and that will hinder consumer trust and trust in the government.”
The group noted that when Californians purchased the system, they signed a state-mandated legal agreement with details on the condition that the customer is eligible to receive credit for 20 years.
In California, under a policy known as decoupling, the utility does not make more money as customers use more energy. Instead, you generate most of your profits by building an infrastructure that includes poles, wires and other grids.
In their letter, the environmental group pointed to an analysis of economist Richard McCann performing in the rooftop solar industry.
While homeowners’ solar panels helped to maintain electricity demand for 20 years, spending for three utilities on transmission and distribution infrastructure rose 300%, McCann found.
“To address rising fees, California needs to focus on what’s really wrong with its energy system: uncontrolled utility spending and record-breaking utility benefits,” the environmental group wrote.
A hearing on the bill is scheduled for April 30th by the Parliamentary Utilities and Energy Committee.
Cherene Birkholz of Long Beach said she and her husband spent $22,000 on panels for their home. The couple said they could stay in California after retirement because they saw solar panels as a way to manage costs.
Birkholz said he believes the credits will last for 20 years. The proposed law “came in shock,” she said.
“If I had known, I might not have made these decisions,” she said.
Dwight James of Simi Valley said he spent $35,000 on solar panels in 2018 and $40,000 on batteries in 2021 to store electricity. He said he funded the purchase with a 20-year loan and found that he had “anxious” after the state’s promises.
“If you follow the money, it gives you all the answers,” James said. “In my opinion, this bill is a way for utility companies to keep it a little longer and try to delay adoption of the Sun.”
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