CALSSA executive lashes out at California NEM proposal

The proposal would cut export rates by nearly 80% to encourage decentralized energy storage. Image: REC Solar.

According to Bernadette Del Chiaro, executive director of the Clean Energy Business Group of the California Solar and Storage Association (CALSSA), the California Public Utilities Commission’s (CPUC) recent proposal to measure Net Energy Consumption (NEM) is too extreme and will discourage homeowners from using solar energy for use in private households).

Speak with PV TechDel Chiaro said that “instead of speeding up the batteries, everything we do is slowing down solar energy.”

The latest iteration of proposed NEM 3.0 legislation incentivizes battery storage alongside rooftop solar panels by proposing time-specific energy tariffs, higher at evening peaks and lower tariffs during the day. It also projects savings of $136 per month for residential solar-plus-storage customers compared to $100 per month for stand-alone solar customers.

The most controversial measure, however, was a nearly 80 percent cut in export quotas for private solar customers. The current rate is $0.30/kW, but the proposal would lower it to $0.08/kW.

Reactions across the industry have highlighted the need for a gradual glide path to lower export rates and thereby encourage inventory.

“If you really crunch the numbers, which is what we took the time to do, the needle doesn’t move on energy storage,” Del Chiaro said.

In its original NEM 3.0 legislation proposal, submitted in March 2021, CALSSA emphasized the importance of energy storage to California’s power grid and to meeting the state’s greenhouse gas goals. Distributed storage has been cited as a key method to address the increased load on the power grid from electrification.

However, CALSSA’s original proposal read: “The limited availability of batteries and high soft costs for storage projects remain barriers to the large-scale deployment of storage, and the Commission needs to give the distributed energy storage market time to mature.”

The November CPUC proposal said its actions “allow a transition period for the solar industry to adapt to a solar market with storage capacity.”

For Del Chiaro, the latest proposed decision does not do that. “It’s as if their recipe for incentivizing batteries is to penalize solar power,” she said. Drastically reduced export quotas will make domestic solar systems significantly less affordable for Californians.

A recent EY report identified decentralized grids and distributed solar power as key to renewable energy adoption in developed countries. A study by Wood Mackenzie in October said the US rooftop solar market is in growth mode, but California’s NEM proposals are one of the factors that could pose future challenges given the state’s historically dominant position in the market.