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California Utilities Take Aim at Rooftop Solar

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Photo: h080/Flickr/Creative Commons License

California's three largest investor-owned utilities are renewing their complaints over rooftop solar, according to a story this morning on the business website Bloomberg.com. As more and more homeowners install rooftop solar panels and sell power back to the grid, utilities say they are passing as much as $1.3 billion in costs on to other customers.

Not mentioned by the utilities: the more than $15 billion ratepayers across the state will need to pay to build new transmission lines if we meet the state's renewable energy mandates without rooftop solar.

According to the article, the state's three largest investor-owned utilities -- San Diego GHas & Electric (SDG&E), Southern California Edison (SCE), and Pacific Gas & Electric (PG&E) -- estimate that once the state hits its legal upper limit on net-metered solar, the utilities will be passing along hundreds of millions of dollars in costs to ratepayers without solar panels. SDG&E will be getting $200 million a year from non-solar ratepayers; SCE about $400 million, and PG&E about $700 million.

By comparison, SDG&E's Sunrise Powerlink transmission line, which was built with the ostensible intention of moving renewable energy from Imperial County to San Diego, is being funded entirely by ratepayers to the tune of $1.9 billion dollars. SDG&E isn't griping over that cost to its ratepayers, likely because the utility will likely earn $1.6 billion in total profits on the transmission line over its 58-year expected lifespan.

In 2009, a report by the Renewable Energy Transmission Initiative -- a body composed of agencies and utilities -- forecast that in order to build enough utility-scale renewable energy capacity to comply with California's Renewable Portfolio Standard, the state would have to build $15.7 billion worth of new transmission lines. That was up from $12 billion forecast a couple months earlier by the CPUC. Costs for that new transmission, which will certainly be higher by the time they're actually built, would be borne by ratepayers.

It's understandable that investor-owned utilities are upset about losses due to rooftop solar and other locally owned distributed generation: the explosion in new technology threatens the utilities' business models, much as advances in recording and duplicating technology threatened the music industry's business models.

As Bloomberg reports, the utilities' complaints haven't gotten far:

So far, regulators haven't been sympathetic to utilities' complaints about rooftop solar power. The California Public Utilities Commission rejected in January San Diego Gas's request to impose a "network use charge" that would have added a fee to customers with rooftop solar panels.

But for ratepayers concerned about utility warnings that they may have to foot the bill for someone else's solar panels, consider this: every rooftop solar installation lowers the chance you'll be on the hook for almost $16 billion in transmission lines. And these days, with third party solar leasing firms, you can always just get your own.

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