Sullivan Solar Power employees Josh Childers and Miguel Padilla install solar panels on the roof of a San Diego home. / Photo by Jamie Scott Lytle
San Diego’s considered a national solar hotspot.
This spring, the nonprofit Environment California Research & Policy Center dubbed San Diego the No. 2 solar city in the U.S. in a national survey.
That same report noted San Diego’s solar growth outpaced Los Angeles, the nation’s top solar mecca.
Yet the region and the rest of the nation are approaching a crossroads. Some solar policies and incentives are nearing near expiration, and utilities such San Diego Gas & Electric are looking to up charges for solar customers as the technology becomes more widespread.
I pulled together some background reading to help you catch up on the local and national solar story before we dig in further.
Panel Power 101
California’s Solar Surge
- Climate change is a thing and California’s given the solar industry a shot in the arm with a series of mandates to incentivize the switch to greener power sources. Those state-level rules have forced utilities to pay solar customers for the extra power their panels generate and required those utilities to transition to power supplies that are at least 33 percent renewable by 2020.The state-sponsored incentive program known as California Solar Initiative was also crucial, as Greentech Media detailed here. The site also put together a handy list of all the state’s solar rebates and tax credits.
- Gov. Jerry Brown kicked off 2015 with an announcement that he’d like to up that renewable target to 50 percent by 2030. Experts told The Desert Sun a new mandate could be another boon for solar companies.
- Homeowners and businesses that invest in solar in California can produce much of their own power and save even more when they generate more than they need.The utility industry isn’t so jazzed about the current cost model because it says solar customers aren’t paying their fair share for use of utility-maintained grids. The Washington Post detailed a top industry group’s campaign to raise prices for solar customers and protect utilities’ business models.
- The current version of net metering, the state system that allows California solar panel owners to get money back when they produce more energy than they need, is an endangered species.SDG&E and other utilities across the state can only offer net metering to a limited number of customers until they reach a previously-set cap, which some experts believe San Diego could hit as soon as the end of this year. U-T San Diego provided an update last fall, when SDG&E reached its halfway point toward the cap.The state Public Utilities Commission is set to work on a new net metering arrangement but it’s unclear how that will affect future solar customers.Current solar customers are grandfathered in for 20 years per the current policy, as the San Francisco Chronicle explained.
San Diego’s Solar Status
- An SDG&E executive told trade publication Utility Dive that solar could create challenges for San Diego’s grid when it reaches 15 percent penetration though the utility’s been working on potential solutions before that happens. As of last month, about 4 percent of SDG&E customers were solar customers.
- Last August, San Diego Gas & Electric told U-T San Diego it expected to reach the 33 percent renewable target well before 2020, and as early as the end of 2014. That didn’t happen but the utility says it has hit 32 percent. An SDG&E spokeswoman told Voice of San Diego the utility could meet the target this year. Those figures don’t include rooftop solar.
- SDG&E wants to change its current rate structure and its proposed tweaks frustrated some big solar customers. Five San Diego County school districts filed a protests to SDG&E’s suggested peak pricing period, which the utility wants to shift from 11 a.m. to 6 p.m. to 2 p.m. to 9 p.m. They told U-T San Diego the change would mean their solar investments don’t pencil out as planned, leaving less money to spend on students.
- Local governments are ramping up their solar commitments too.In March, the County Board of Supervisors approved updates to the county’s building code that require new homes in unincorporated areas of the county to be built solar panel-ready, as City News Service reported.The city of San Diego’s also been working on a Climate Action Plan that encourages more solar investment, namely with its goal of achieving 100 percent renewable energy by 2035. VOSD reporter Andrew Keatts offered a rundown of the original draft and updates Mayor Kevin Faulconer made to it after he took office.
The National Solar Story
- The federal Energy Information Administration projects continued growth of renewable energy sources including solar will outpace all others through 2040 – and says solar’s the fastest growing source of renewable energy.And the Obama administration recently said the solar industry’s adding jobs 10 times faster than the rest of the economy and that solar power generation doubled last year as it announced new jobs programs to promote the industry.So, basically, our nation is increasingly solar powered and the growth is likely to continue unless there are major shifts in incentives and prices.
- As solar becomes more popular, utilities have to cope with how the additional energy generated by rooftop panels affects the grid.The Hawaiian Electric Company responded in 2013 by temporarily halting installations in some areas amid concerns about how to handle the power coming in, particularly given its lack of predictability. The New York Times reported on Hawaii’s solar battles and the fears utilities have about how solar installations will affect their business models and the grids they manage.
- One more cloud in an otherwise sunny solar future: A federal incentive known as the Investment Tax Credit is set to expire at the end of next year. Engineering.com has more details on the impact of the subsidy, which now allows solar companies to claim a 30 percent credit on project costs. The solar industry’s pushing lawmakers to extend it.
- A key challenge for folks relying on solar is that their panels produce power when the sun’s out and that power immediately gets sucked up by others on the grid. So solar experts have been hard at work to find ways to store that energy and save it for later when the sun goes down, which would allow more folks to go off the grid. That’s why Tesla’s announcement that it plans to roll out a battery that will allow solar customers to store energy is such a big deal. The Washington Post broke down how that new product be such a game changer and The Verge led with another angle: Why utilities should be panicking about those batteries.
This is part of our quest on whether solar will pay off for San Diego. Check out our introductory post here.
Correction: An earlier version of this post gave an incorrect date for the expiration of the solar Investment Tax Credit. It will expire the end of next year. We also added a link about Tesla’s new battery.