Apr 12 - San Jose Mercury News

Electricity generated by a solar roof cuts a homeowner's utility bill, but some of those folks are upset when they learn that the best they can do is end up with a $0 bill, no matter how much power they produce.

That could be about to change.

AB 1920, working through California's Assembly, might mean that big utilities, such as Pacific Gas & Electric, would have to to write checks to customers whose solar-roof power generation exceeds the amount they use.

California could be the first state with such a program, although others, including Michigan, Minnesota and Rhode Island, are considering similar strategies.

Under California's Solar Initiative and current laws, the size of a solar installation is limited so that generation and consumption are roughly equal.

That's why Chris Bellizzi, who lives in a 5,100-square-foot home in Saratoga with a 3.73-kilowatt photovoltaic array on his roof, ended up owing PG&E just 25 cents in September. (Customers with solar systems reconcile generation/consumption accounting with PG&E once a year.)

Bellizzi sees an unfairness in the system. "If you owe them, you've got to send them a check," said the owner of a tree service. "If they owe you, they'll pocket it."

In fact, he said he abandoned his usual power-conserving ways last year when it looked as if PG&E would get $100 he feels he earned from his solar roof. "I used a bunch of power I normally wouldn't," he said, telling his kids they

could run the air conditioning more.

That's just the type of "perverse message" that prompted Assemblyman Jared Huffman, D-San Rafael, to introduce AB 1920. The measure passed the assembly's utilities and commerce committee this week and will be heard by the natural resources committee Monday.

The state, through the California Solar Initiative, wants 1 million solar roofs. Huffman said his bill will reduce some of the impediments to getting to that goal.

Right now, the size of a solar installation directly relates to the amount of power a homeowner or business uses, he said, so bigger systems that make more power aren't allowed.

"If they generate surplus power beyond their own energy needs, that's a gift to the utility," he said. "There's no compensation."

That's enough to keep some folks from installing solar, Huffman said, and it certainly limits the size of installations.

"This bill for many people will improve the economics," he said.

PG&E, based in San Francisco, has 20,000 solar customers right now, generating 175-megawatts of electricity. Of those, spokesman Keely Wachs said, 22 percent have a financial credit at year's end. That's because the state mandates that utilities pay solar owners a "premium rate" of 30 to 35 cents a kilowatt-hour for the power they generate. But even if they earn it, those customers don't get the extra money.

Only 7 percent of PG&E's solar customers generate more kilowatt-hours than they use, Wachs said.

The utility, which touts itself as a major proponent of solar, finds itself in the unusual position of arguing against AB 1920.

PG&E feels the bill would mean that all of its customers would end up subsidizing those with solar systems, who tend to be wealthier customers. Plus, as written, the bill requires only investor-owned utilities, such as PG&E and Southern California Edison, to make payments, not municipally owned utilities, Wachs said.

The utility feels that AB 1969, passed in 2007, offers a better solution, he said. Under that law, customers can decide to become energy producers and sell power to PG&E.

But with that option, they would lose both solar-initiative rebates and the premium rate for their power, earning a market rate of perhaps 9 to 10 cents a kilowatt-hour. And this would apply only to customers who decide to enter into the agreement and forgo other payments, while Huffman's AB 1920 would apply to everyone with a solar roof.

A San Francisco ratepayer advocacy group shares PG&E concerns, which itself is a rare occurrence.

The Utility Reform Network, which usually criticizes PG&E for wasting customer money, opposed AB 1920.

"Homeowners who generate excess electricity should be paid fairly for that electricity, but shouldn't be subsidized a third time by the rest of the ratepayers, who already fund generous subsidies for rooftop solar," said TURN staff attorney Marcel Hawiger.

Supporters of the bill include Environment California.

"We should take away any disincentives there are," said Dan Jacobson, the group's legislative director.

"We don't expect this to be a huge moneymaker," he said. "It's not like people won't need to get jobs and live off their solar. This will only help to pencil out solar a little faster."

Huffman said it's likely the bill will be altered to reflect some of the concerns, and questions about how much to pay for the excess power haven't been resolved. He thinks the bill's chance for passage is "pretty good."

Contact Matt Nauman at mnauman@mercurynews.com or (408) 920-5701.

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