California Tries Again For A "Community Clean Power' Bill

Sen. Lois Wolk introduced the bill yesterday, a second attempt by her and solar energy proponents to pass such renewable energy sharing legislation. SB 43 will allow renters, along with homeowners who don’t have good enough credit or have roofs that aren’t suitable for solar panels, for example, to sign contracts with owners of solar power generation projects for a portion of the electricity produced. The amount they pay for will show up as credits on their utility bills. Businesses that lease office space will be able to do the same.

Participants could buy enough renewable electricity to offset 100 percent of what they get from their utilities. The renewable energy generation projects they contract with must be located within their utilities’ territories. Each project can’t be larger than 20 MW in size. The bill would apply to investor-owned utilities in the state, such as Pacific Gas & Electric, Southern California Edison and San Diego Gas & Electric.

The renewable electricity produced won’t actually be piped to the buyers. Instead, it will flow into the grid and in effect increase the amount of clean energy in the power supply.

The concept of subscribing to offsite solar or wind power generation isn’t new. Some utilities in the country promote programs that tag on some extra dollars on the monthly bill of customers who pay for renewable energy that their utilities buy on their behalf. Xcel Energy, for example, runs its Windsource program in several states. Closer to home, the Sacramento Municipal Utility District runs a SolarShares program.

A startup called Solar Mosaic in California has sold shares of solar power projects but markets its service as an investment opportunity.

Although SB 43 covers various kinds of renewable energy, solar energy will likely be a popular choice. Unlike, say, wind turbines, solar panels can easily find a home not only on land close to cities but also high above ground, such as the roofs of large industrial complexes. That flexibility, along with a state incentive program called the California Solar Initiative, already has made California the largest solar energy generation market in the country.

The latest bill differs from the previous version in several ways. Instead of creating a 2-GW program, the new bill will create a 500-MW one instead. The California Public Utilities Commission can expand it later. The bill also includes language on protecting sensitive environments from renewable energy development and ensures that clean power projects serving low-income residents also will be located close to them, said Tom Price, director of policy and market strategies at Cleanpath Ventures, a power project developer in San Francisco that has helped draft the bill. The idea is to promote solar construction jobs in low-income communities. The new bill also simplifies the process for crediting the renewable electricity purchases on the utility bills, he added.

Solar energy proponents say the bill will benefit the majority of the households and businesses in California because they are renters or don’t have suitable properties for installing renewable energy equipment. It does indeed provide more access to clean power. It also threatens the traditional business model of utilities, unless the utilities get into the game of building and selling these shared renewable energy projects. But they won't be allowed to do that under SB 43.