California Power Utilities Seek to Cut ‘Net Metering’

California’s Power Utilities have asked state officials to reduce the amount of money homeowners make selling the excess electricity from rooftop solar panels into the grid. This proposal could slow the widespread solar power adoption. Policies made in California state, the nation’s biggest market for rooftop solar panels, serves as a template for other states.

Many states are seeking to replace fossil fuels with renewable energy to fight climate change issues. The solar industry representatives, the utility ratepayer advocates, and others present ideas on potential reforms this week. The ideas will be presented at the California Public Utilities Commission who will decide later this year. The new policy will take effect in 2022 or 2023 is the word in the market.

On Tuesday and Wednesday, the competing proposals presented to focus on a decades-old policy called net metering. This old policy allows homeowners with solar panels to sell the excess power to their utility at or near the total retail rate. This incentive has increased the number of installations that have helped residential solar behemoths like Sunrun and Tesla and several small local firms.

However, the power industry argues that this policy is overly generous. The policy shifts millions of dollars in grid maintenance costs to their customers without panels. They tend to be less affluent than solar owners. The three investor-owned Power Utilities of the state – Pacific Gas & Electric, San Diego Gas & Electric, and Southern California Edison – have been recommended a monthly charge for solar owners that would range between $49 and $79 for a 5-kilowatt system.