Photo: A team installs solar panels in Irvine, California. Credit: Thomas Kelsey/U.S. Dept. of Energy Solar Decathlon (CC BY-ND 2.0)
Tina Landis is author of the book Climate Solutions Beyond Capitalism.
You may be under the impression that California is leading the United States in the renewable energy transition, but the state recently took a major step backward. On May 30, the California Public Utilities Commission voted 3-1 rejecting a plan that could have boosted the state’s community-solar-battery projects by eight gigawatts, which could power around 800,000 homes. The plan, called the Net Value Billing Tariff, could have increased California’s solar energy production by 17% of current levels.
Despite backing from a broad coalition of forces — solar companies, farmers, environmental justice organizations, labor unions, consumer advocates and both Republican and Democratic state legislators — the CPUC sided with privately owned utilities’ continued control over the state’s energy system. Instead of voting to support community solar expansion, the CPUC instead ordered the state’s for-profit energy providers — Pacific Gas & Electric, Southern California Edison and San Diego Gas & Electric — to restructure their distributed solar programs that for more than a decade have done little to nothing to expand solar energy in the state.
Passed last September, state Assembly Bill 2316 ordered the CPUC to establish a new affordable and equitable community solar program that would increase development. The bill attempted to address the failings of the commission’s existing programs that only expanded community solar capacity by 163 megawatts over several years, which translates to energy capacity for around 16,000 of the 14.5 million homes in the state. The 20 state legislators who backed AB 2316 warned that without the NVBT, the state will likely fail to meet its renewable energy and climate goals.
CPUC ruling only benefits private utilities’ companies
PG&E, the largest private utility in the United States, will benefit once again from its close relationship with the CPUC. Just last year, the CPUC voted in favor of a $13.5 billion revenue requirement for PG&E, which has resulted in a 13% increase in customers’ bills, increasing energy rates to double what they were in 2019.
PG&E has a long history of criminal negligence that has not only caused property damage but taken many lives across California, from the toxic waste they illegally dumped in Hinkley that poisoned the town’s drinking water, to their gas line explosion that destroyed an entire neighborhood in San Bruno and killed eight people, to their aging transmission infrastructure that has sparked untold numbers of wildfires across the state. PG&E’s faulty power infrastructure sparked 1,500 fires between 2014 and 2017 alone, with the most tragic incident to date — the 153,000-acre Camp fire — killing 84 and destroying the town of Paradise in 2018, among many other crimes.
This latest CPUC ruling that benefits PG&E and other private utilities in the state will mean a much slower and more expensive transition to solar. Previously, in 2022, the CPUC slashed payments to homeowners with solar who were selling excess energy back to the grid. This resulted in a crash in the solar market throughout the state and major industry job losses at a time when we need a major expansion of renewables to combat climate change. The following year, the commission again cut solar incentives limiting the payments for excess energy produced – this time targeting solar at schools, businesses and multi-unit apartment buildings.
California lags behind other states in community solar programs, producing only 1% of the 6.28 gigawatts of energy provided through community solar programs in 22 states. The NVBT would have allowed community solar projects to earn a steady revenue from the power produced, incentivizing an expansion of clean energy and battery storage. Through the revenue earned by selling excess energy back to the grid, low-income residents would have seen reduced utility rates. For communities of color and low-income communities in the United States, utilities often take up a large portion of household income, becoming an even larger percentage of income with PG&E’s ever-increasing rates.
In general, California is missing the mark to meet its goal of 40% greenhouse gas emissions reductions below 1990 levels by 2030. At the current trajectory, the state would need to triple the rate of emissions reductions made since 2010. Considering this shortfall and the urgency of the climate crisis that is severely impacting the state through extreme drought and heat waves to increasingly destructive wildfires and floods, you would think the state would be employing every possible resource to rapidly reduce emissions.
Solar and wind are currently the lowest cost energy source and the quickest to deploy. Yet, the state actually went in the opposite direction and saw a 3.5% increase in emissions from the energy sector between 2019 and 2021. In order to meet its climate goals, the state must reduce energy sector emissions by 6.3% annually between 2021 and 2035. Lack of state support for renewable adoption that makes it unaffordable for community solar to be significantly expanded, as well as the stranglehold that private utilities have on the energy sector, are to blame.
Expanding community-solar microgrids – which was the goal of NVBT – could help to rapidly reduce emissions from the energy sector. Microgrids run independently, but can share energy with the larger grid. This increases resilience to outages during extreme weather events unlike a centralized grid that can suffer widespread outages impacting millions. Microgrids also reduce energy costs and reduce energy loss from transmission across long distances. Under capitalism, community-solar microgrids are a threat to private utilities’ profits. In the end, ensuring continued profits for the ruling elite outweighs implementing real climate solutions in any meaningful way.
New Cold War on China impedes real climate solutions
In general, the United States lags far behind in renewable capacity compared to China, which is leading the world in renewable energy capacity with nearly four times greater capacity than the United States. China also produces 77.8% of the world’s solar modules at a far lower cost than any other country due to economies of scale. The U.S. tariffs on Chinese goods are another impediment to the rapid shift to renewables. Despite claims of concern for climate change, the Biden administration recently approved an increase on the tariff on Chinese solar cells to 50% — in addition to the 102% tariff on Chinese electric vehicles, which will only strengthen the barriers to climate solutions being implemented.
Under socialism, in a wealthy country like the United States, an equitable transition to renewable energy could rapidly be achieved. And resources and technology would be shared across borders, speeding up the transition to an ecologically sustainable world.
