Governor-Backed Bill AB 327 Calls for Unlimited Solar Future

Sacramento – AB 327 (Perea) began the 2013 legislative session as the biggest residential rate reform bill in a decade. With amendments coming out of Governor Brown’s office, AB 327 will likely leave the legislature as one of the state’s most influential solar bills. As amended, AB 327 envisions a future in which solar power is unlimited opening up the market to millions of new customers. It leaves details of how to achieve this future to the state regulatory agency overseeing electric utilities.

Recent amendments to AB 327 aim to ensure that the state’s solar power market continues to grow by directing the California Public Utilities Commission (CPUC) to give consumers unlimited access to rooftop solar power through what is called net energy metering. Net metering is the policy that allows a solar system owner to spin their meter backwards during the day to generate a bill credit for when the sun is not shining. It is a critical component of the economics of solar power and one that has long been fought by utilities.  Existing law caps the number of homeowners, businesses, farms, and schools able to invest in solar via net metering at 5% of a utility’s peak load. Once that 5% cap is reached, utilities no longer have to sign up new customers. Existing customers, having gotten in under the cap, would be allowed to stay on their net metering tariff.

As AB 327 goes up for its final big vote today in the Senate, concerns about the future remain. Many clean energy advocates are opposed to a fixed charge of up to $10 per month that could hurt investments in efficiency and solar power. Current owners of solar power systems, those that signed up for net metering before the 5% cap, including farms and schools, are opposed to a controversial provision that would direct the CPUC to determine how long existing solar customers can hold onto their current net metering agreements.

“A deal is a deal,” said Del Chiaro. “California should not change the rules of the game retroactively on the market’s early adopters, especially not after doing so much to encourage these consumers to get into the market in the first place.”

Addressing concerns that AB 327 was creating a lag time of uncertainty as the market waited for the new rules, the bill was recently amended to require the so-called called “grandfathering provision” for current customers be finished within 90 days of the bill becoming a law, or March 2014.

“The devil will be in the details hammered out at the CPUC,” concluded Del Chiaro. “We greatly appreciate the governor’s vision and support of solar power as a smarter way to generate electricity and we look forward to working with him and the CPUC to craft regulations that protect existing customers and open the doors to millions more.”

AB 327 is expected to be voted on the Senate Floor as early as today. Then it must return to the Assembly for concurrence before heading to the Governor’s desk.

CALSEIA, the California Solar Energy Industries Association, is the nation’s oldest and largest solar industry association representing manufacturers, installers, and distributors of solar panels and related components and technologies throughout the state.