A new bill is working its way through the California legislature that has the potential to open up solar power investment and net metering to the 44% of the population that, according to insidebayarea.com, do not own the buildings in which they live or work. The bill, Senate Bill 843 (SB 843) known as the Community-Based Renewable Energy Self-Generation Program, would create the legal framework for families and businesses to buy a contract for power from a solar generating facility, and then have that power be counted against their grid consumption on their utility bill.
California has one of the lowest rates of home ownership in the county at only 55%, and policy makers believe that this has significantly reduced the ability of the market to provide incentives for investment in solar power. Renters are understandably hesitant to invest large quantities of capital in providing hardware upgrades to property they don't own and can be evicted from. Landlords, who usually are not responsible for the utility bills of their tenants, have no financial incentive to invest in solar power generation on their buildings. Even if tenants wished to add solar to their rented home and the landlord was willing to allow it, it would be unlikely that a renter would be able to obtain credit for an investment over which they had no guaranteed return.
The advocates for SB 843 at e2.org claim that the bill will open up access to both residential and commercial renters without any state expenditure. According to The Energy Collective, the bill would allow consumers to purchase electricity directly from solar producers, who would feed the power directly into their local grid. The consumer would then be credited for the purchased kW hours on their monthly utility bill, effectively net metering their consumption by offsetting their consumption elsewhere.
The system would be built on the existing technology already used for "virtual net metering," an already existing system by which multi-tenant buildings with solar panels can sell power to their individual tenants. While it would be calculated by the same mechanism, only the power generation portion of the customer's bill would be metered, to reflect the fact that the offsite generation of power does not offset transmission and grid maintenance costs.
If the bill works as promised, it will radically impact not only the customer base for solar power, but could have second and third order impacts throughout the economy. Expect to see church and commercial property developers start designing buildings with large south facing roofs, to take advantage of this new secondary revenue stream. If the bill will work as intended, however, is something which there is still a great deal of debate on.
Several of California's largest utilities are skeptical of the project, including Southern California Edison, which has come out in opposition to the bill. Insidebayarea.com reports that utilities cite additional non-generation costs associated with connection distributed power production infrastructure that would be born by solar and non-solar consumers alike, and the fact that as currently written, SB843 would not count the 2 gigawatts (2,000,000 kW, enough to power 500,000 homes) that estimates say the bill will create as part of their required renewable energy mix. While this opposition means the bill is not guaranteed to pass, the debate appears to be about the distribution and size of costs rather than the effect the bill will have on solar power generation.
If implemented, SB843 promises to be an intriguing case study in the ability of policy makers to correct one of the largest market failures facing solar power today. Once again, it appears that California is leading the way in tackling the renewable energy roadblocks thrown up by our country's legacy of centralized power production, transmission, and regulation.
