CA "REC Taking" Redux

I was suprised to discover last week that the utilities are back at the table trying to take Renewable Energy Certificates (RECs) from solar power system owners. Once again, their claim is that because they administer California's solar incentive payments, they should be granted ownership of the associated RECs.

Nevermind that the issue of REC ownership and DG incentives was decided on largely the same grounds over a year ago. As if taking a second swing at the issue wasn't already distasteful, the way they're going about it is ruffling some feathers. Rather than participating openly in the appropriate CSI or RPS proceedings, they went behind closed doors and made an intentional ex parte argument to some of the commissioners and staff.

The rumour is that the CPUC almost issued a ruling in favor of the utilities last Tuesday, but a quick intervention by solar advocates David Hochschild at PVNow and JP Ross at VoteSolar managed to put the brakes on. Rather than try to re-make their arguments myself, I'll just quote the key points from PVNow's letter:

• This would slow California’s progress toward the 3000 MW goal.Solar RECs provide an essential incentive for solar customers, both those who require them to make a legal environmental claim about green energy for PR purposes etc. and those for whom the income or prospect of income provided by a solar REC sale can tip the balance in favor of investing in a solar energy system.
• The CSI is considered an explicitly separate path from the RPS in the Climate Action Team’s Report. The CSI accounts for 3 million metric tons of CO2 equivalent in 2020. This amount of carbon emissions is in addition to the 33% RPS which yields 11 million metric tons in the same timeframe. Should the Commission decide to allow the CSI solar RECs to be donated to the utilities for their compliance with the RPS, this incremental 3 millions would be lost to the state.
• Utilities have no claim to 100% of the solar RECs. Donating 100% of customer-generated solar RECs to the utilities is at odds with the fact that a solar investment is made by each of three principle parties (the customer, the state of California, the federal government via the tax credit). The federal government makes no claim to solar RECs, or any other form of RECs, regardless of federal renewable incentives. In fact, a number of government agencies buy green power products comprised of RECs supported by a number of federal incentive programs (http://www.epa.gov/greenpower/partners/top25.htm)
• Ratepayers still benefit if customers own the solar RECs. Contrary to assertions from some utilities, ratepayers still benefit from customer ownership of solar RECs because the load reduction solar customers create reduces utilities renewable procurement obligations. Every MWh of load reduction reduces RPS procurement obligations by 33%. Furthermore, customer ownership of solar RECs will get us to the 3000MW goal faster and that means more locally produced solar RECS will be available for utilities to buy, and every subsequent watt installed after the 3000th MW reduces the RPS requirement for all utilities at no cost to ratepayers while contributing non-polluting peaking energy to the grid.
• CA should treat REC ownership consistently across all generation sources. All generation sources receive federal and state incentives of various forms. But in other cases, an RPS participant must contract with the generator to buy the RECs. Customer-sited, solar energy should not be treated any differently.

Hopefully this is the last we'll hear about this issue! Well done, David & JP.

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December 6 Postscript: The CPUC issued a draft decision today granting 100% ownership of RECs to renewable DG system owners. All's well that ends well.

Comments

[westchester solar energy]

future is going to be of solar energy then why dont we start right now.