California pushes a new plan to cut rooftop solar incentives without actually cutting them.
California’s plan would give solar customers a break on their utility bills for installing rooftop solar despite the fact that they would end up paying the same for the electricity they produce.
The state is putting together a plan that would give residential solar customers a $25 credit for each new watt they build, which is half the previous credit of $45. California officials say the money is important because it helps pay for the massive utility rebates.
The state is allowing its utilities to collect those rebates for only so many months. So by the time the utilities are done taking the money, residential solar installations will have paid for themselves.
The state already has an economic incentive for solar, which makes it easy to get solar when utilities don’t have the money to pay for electricity. But it will become more difficult for utilities to get money from residential solar installations.
The incentives will disappear completely if the federal government gets involved.
The utility companies have been pushing a federal tax credit, which would pay for solar. That is expected to go through the House of Representatives. A Senate version has been rejected.
If the solar tax credits were extended long enough to cover solar installations, the price of solar electricity would have to take a hit. Utilities will be able to continue to pay for the electricity they produce, but they’d have to find a new source of the money to cover their bills.
The electricity prices can’t go down now, but they could come down if the tax credits were made longer.
California is taking an important step to make solar energy more affordable while still benefiting utility companies. Solar is very expensive in California, and many utilities claim they are losing money on the solar electricity they provide. The state is now trying to put the brakes on that.
The California Public Utilities Commission said it will reduce incentive programs in a proposed rule that will be put to a vote in February. But the reduction is not a full rebate.
The proposed rule is an attempt to slow the growth of the solar industry by making it harder for the utilities to take money from solar customers.
The current incentive programs are in place because there is no other way for the utilities to make money by