On Tuesday, California regulators issued a decision that state utilities could not charge certain fees for solar-plus-storage systems in homes and offices, clearing the way for such projects to proceed.
For about a year, California’s big three utilities — Southern California Edison, Pacific Gas and Electric, and San Diego Gas And Electric — have been charging customers, be they individuals or businesses, various fees for setting up a solar system on their property that includes battery storage. That includes an $800 interconnection application fee, as well as various other charges that can bring the cost between $1,400 and $3,700. The utilities also insisted such systems go through an extensive review process for, they claimed, safety purposes, and to ensure the systems weren’t just storing power produced by the utilities and then seeking credit for it under California’s net metering rules.
Solar system installers said the hurdles have ground new solar-battery projects to a halt. SolarCity, the biggest solar provider in the US, said that only 12 of the 500 customers that signed up for its solar battery systems have been connected to the grid. Among other efforts, SolarCity has started up a pilot project to provide commercial buildings with both a solar array and battery produced by Tesla Motors.
But Tuesday’s decision by the California Public Utilities Commission (CPUC) scuttled many of those obstacles. Under CPUC’s proposal, distributed generation systems (usually solar, but not limited to it) that are eligible for net metering, and that are over 10 kilowatts, must keep their storage component under that 10 kilowatt capacity. For smaller systems, there would be no size limit. Systems over 10 kilowatts will also need a separate meter to keep track of the interchange between electricity generation and battery charging. For smaller systems, local data from the net metering system will be used to tease out the energy drawn into the battery. “Trusting the solar-storage system to measure its own give-and-take status against the grid,” as GreenTech Media put it.
A final ruling on CPUC’s decision could come as early as May 15. And according to Bloomberg Businessweek, SolarCity has already restarted its application process for new solar-plus-storage systems in light of CPUC’s move. The previous regime of fees and studies had convinced the company to halt the applications back in March.
“I think it’s going to streamline it quite a bit. There were customers who weren’t able to pay these interconnection fees who we can now move forward,” Peter Rive, SolarCity’s co-founder and CTO, told GreenTech Media. Other companies like Sunverge and Outback Power also filed briefs in support of CPUC’s decision.
Grid operators and utilities worry that the rise of battery storage and distributed generation like solar will cause more and more customers to simply defect from the grid entirely. In a blog post on SolarCity’s website, Rive attempted to allay those fears, pointing out that the spread of batteries at the residential, commercial, and utility level could work to grid operators’ advantage if properly harnessed.
“In this scenario, grid operators are suddenly empowered to store and discharge solar energy where and when it’s needed most, smoothing out peaks and ramps, while powering more of the total grid consumption with clean and renewable sources,” Rive wrote. “Additionally, utilizing storage to unlock massive benefits in the areas of frequency and voltage support can further lower grid costs. Many of these capabilities are available now through distributed resources, even without storage, and we should work together to put them into the hands of utilities for the benefit of the ratepayers.”