AB 1920: California bill goes beyond Net Metering

Requires California Utilities to pay for excess solar electric (and wind) power generation.

Under the California Solar Initiative (CSI), net metering limits your electric bill to near zero even if your photovoltaic system generates more power than you consume. AB 1920 corrects this situation by forcing utilities to compensate photovoltaic system owners for any excess solar electric power generated. In effect, the electric bill can go negative with a credit for the system owner.

AB 1920 is a bill authored by California Assembly member Jared Huffman (D-San Rafael) as a result of entries by his constituents in the 2008 “There Oughta to be a Law” contest (see Huffman Watch: Our Assemblyman at Work). AB 1920 can be summarized as follows:

AB 1920 (Huffman): Renewable Energy Incentives – Net Metering
Enables residents who produce renewable energy for their homes, small businesses or farms to get paid by their utility company for any excess electricity they produce that goes back on the grid. Level of compensation to be determined by the Public Utilities Commission. Provides utilities with Renewable Portfolio Standard (RPS) credits for purchasing the renewable energy from their customers. Removes the “size to load” restriction in state law that limits energy customers’ ability to “supersize” their solar electricity systems.

Here are the key reasons why AB 1920 is needed to again patch the excessive complexity and loopholes of the CSI:

• Net metering discourages electricity conservation and encourages California consumers to waste their solar electricity until their negative accounts hit zero.
• The “size to load” restriction rewards electricity wasters with a history of high electric consumption while valuable roof area and lower per watt installation costs are forgone at frugal electricity consumers.
• Investor-Owned Utilities (IOUs) can claim California Renewable Portfolio Standard (RPS) credits for purchasing excess solar electric power from system owners.

However, AB 1920 should be amended to apply to municipal utilities as well as IOUs like PG&E Corporation.

The compensation rate for excess power under AB 1920 will be determined by the California Public Utilities Commission.

Per Assembly member Huffman’s staff, AB 1920 passed out of the Assembly Committee on Utilities and Commerce (10-2 vote or see Two Huffman Renewable Energy Bills Approved in Committee) and the Assembly Committee on Natural Resources (7-2 vote). AB 1920 next moves to the Assembly Committee on Appropriations where it is expected to “be heard in May”.

Here is the latest amended version of Assembly Bill No. 1920. Further background is available in Cashing in on your solar savings by Matt Nauman with The Mercury News.

GUNTHER Portfolio