AB 920 was signed into law last week. The law requires that utilities pay for energy they receive through net metering. We have followed AB 920 (previously AB 1920) here at the CGBB since we posted our first articles nearly a year ago. AB 920 is the common-sense approach to net metering.
Net metering is an arrangement whereby utilities purchase power from consumers who generate power from solar arrays or small wind turbines. Previously, utilities would provide credits against a utility bill. Starting in 2011, utilities will be forced to pay power-producers wholesale rates for the power (if a credit remains at the end of the calendar year). Cash compensation to the original power producer makes sense because the utility makes money by selling that same power to end users.
AB 920 is a great step, but California needs to travel light years before we realize the “million solar roofs” idea. At the very least, California needs to abandon the limits on the sizes of residential power production. Currently, to be eligible for net metering, residences must limit the size of their solar array or wind turbine. PG&E and other utilities argue that larger arrays and turbines will result in higher electricity rates for those not participating in net metering. This argument can not be summarily dismissed. There are legitimate concerns about reliability from residential power producers. However, utility concerns can be addressed in future legislation (such as infrastructure service fees or production guarantees for net meter users over a certain size). I appreciate that ideas such as this were left out of AB 920 in order to get it passed, but by no means does this mean the work is done.
Also, the net metering program has an overall cap, and after the cap is met residential power producers are not compensated for their power produced. AB 560, proposed by Assemblymember Nancy Skinner, representing the 14th District, would have raised the cap for net metering power available for purchase from 2.5% of peak power to 5% of peak power. PG&E supported that bill, but it died in committee . For an article on some of the issue with the bill, click here.
AB 920 represents a positive step for residential solar and wind power in California, but we have miles to go before we sleep.
