Solar power net metering can benefit California grid, ratepayers

Net-metered rooftop solar will provide more than $92 million in annual benefits to ratepayers of California's three investor-owned utilities

Jan 15th, 2013
Californiasolarenergynetmetering

Net-metered rooftop solar will provide more than $92 million in annual benefits to ratepayers of California's three investor-owned utilities, according to a study released by the Vote Solar Initiative, a solar power advocacy group.

Net metering is a program that provides rooftop solar customers with utility bill credits for the surplus clean energy that their solar systems feed onto the electric grid. Net metering has been a driver of the expansion of solar energy across California's rooftops, with two-thirds of home solar energy installations now occurring in low and median income neighborhoods, according to a July 2012 California Solar Initiative report.

The study comes as the state's investor-owned utilities —Pacific Gas & Electric, Southern California Edison, and San Diego Gas & Electric — increasingly criticize net metering, which reduces their ability to justify the capital investment infrastructure projects that earn them a guaranteed profit.

The study was commissioned by the Vote Solar Initiative and was authored by consultant and former California Public Utilities Commission advisor Tom Beach of Crossborder Energy. Using a CPUC-approved economic model and data from solar power customers, the study assesses the overall impacts of net metering to ratepayers in territories covered by PG&E, SCE and SDG&E.

It finds that the financial benefits of net metered power outweigh the costs, with a total net benefit value of more than $92 million annually by the time the state's net metering program is fully subscribed.

Benefits include: savings on expensive and polluting conventional power; reduced investments in transmission and distribution infrastructure; reduced electricity lost during transportation over power lines, as net metered solar's surplus energy is sent to the grid locally; and savings on the cost of meeting carbon reduction and renewable energy requirements.

In addition to the bill-saving ratepayer benefits outlined in the study, solar energy provides environmental, public health and economic benefits. Thanks to policies like net metering, California is home to a fast-maturing solar industry, which now employs over 43,000 Californians and has attracted over $10 billion in private investment.

Solar adoption has helped school districts and other public agencies survive steep budget cuts, with savings from solar power installations freeing up funds to retain teachers, educational programs, and important government services. Over the next 30 years, schools and public agencies will save more than $2.5 billion on energy bills via net-metered solar energy systems.

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