These homeowners’ PG&E bills reveal California’s dramatic shift on solar
By Chase DiFeliciantonio, San Francisco Chronicle.
Excerpt: When the California Public Utilities Commission slashed the price PG&E had to pay to buy electricity from solar customers, the industry nearly collapsed. But experts say the goal was equity — and a sustainable model that encouraged installing batteries to store power locally. ...In late 2022, [California] state regulators voted to slash the level of that payment by around 75% to bring it closer to market prices. ...“We were on a completely unsustainable path,” said UC Berkeley energy economist Severin Borenstein. “Households producing solar were compensated at the full retail price — at least double the market value of the electricity — for the quantities they sold back to the grid.” That money had to come from somewhere, and the result was that customers in PG&E’s service area who did not have solar panels were effectively subsidizing those that did, according to Borenstein and some experts. One state analysis found that solar credits were on track to increase the power bills of consumers without panels by an average of 25% by the end of 2024, to the tune of $8.5 billion. ...The high price from PG&E for electricity also had another consequence, motivating solar owners to sell their excess power back to the utility rather than storing it locally in batteries. The lower compensation that took effect in April 2023 was meant to reverse that topsy-turvy incentive structure and encourage more consumers to buy batteries. Though they represent a higher up-front cost to consumers, batteries decentralize the power system and help relieve stress on the grid....