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2019 | OriginalPaper | Chapter

21. Consumer (Co-)Ownership in Renewables in California (USA)

Authors : Felicia van Tulder, Sharon Klein, Erika Morgan

Published in: Energy Transition

Publisher: Springer International Publishing

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Abstract

There were and are only a few support policies focusing directly on consumer (co-)ownership. California Senate Bill 1 of 2006 set a renewable distributed generation target of 12 GW installed capacity by 2020, which included 3 GW for self-generation to be realized through the California Solar Initiative. California is one of 17 US states with a virtual net metering policy which, however, is restricted to adjacent or contiguous properties, unlike other states that allow aggregation within a utility territory. CCAs there is no opportunity for consumer ownership, no sharing of tax credits, no consumer involvement in pricing, governance or project-related decisions. California’s Community Choice Aggregation (CCA) model adopted in 2002 empowered municipalities and other units of government, that is, counties, and associations of cities, counties and other public entities, to take control of the procurement of electricity supply in their territory. CCAs can also incentivise consumer-owned RES with enhanced NEM and/or FITs and have the potential to offer additional financing options. All California’s operating CCAs state the goal of progressively increasing their ownership of RE plants to meet their customers’ requirements for renewable electricity supply. More general, participation in RE projects is possible via any available type of corporation, partnership or individual business activity, similar to those in other countries. Cooperatives as a legal vehicle are available but not common. Investments in solar collectors and photovoltaic installations on private buildings, often facilitated by municipalities making use of state financing programs, are gaining in popularity.

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previous chapter Consumer (Co-)Ownership in Renewables in Switzerland

next chapter Consumer (Co-)Ownership in Renewables in Ontario (Canada)

The state leads the country in terms of generation from solar, geothermal and biomass sources, and ranks fourth nationally in terms of installed wind capacity (EIA 2017a).

Plants with an installed capacity over 1 MW and a Power Purchase Agreement with a utility (EIA 2017b).

The so-called “Duck Curve” phenomenon—creating a sitting duck image in the graphic representation of California’s net electricity load—implies an over-generation risk in the afternoon when the solar contribution is highest and a dip thereafter, requiring the need for a fast ramp up of conventional energy to satisfy peak demand (EIA 2014).

In the US, no RE targets are set at the national level; states at their own initiative have adopted RPS as a policy instrument to obligate their electricity supply companies to derive defined amounts of electricity from RES.

Since the 1980s California’s electricity consumption pattern has flattened opposite to the national trend: in 2005 the average Californian consumer used 75 per cent of the energy the average American consumer uses: 7000 kWh per capita compared to 12,000 kWh. This development relates to a decoupling policy introduced in 1982 when utilities’ revenue was detached from sales volume to incentivise the promotion of energy conservation amongst their consumers. Utilities collect revenue according a pre-determined revenue requirement set by the California Public Utilities Commission (Food Service Technology Center 2013).

The federal government enacted the Rural Electrification Act in 1936 to extend electricity distribution to isolated communities. Cooperatives, owned by members of a community, were set up to purchase power in bulk and distribute electricity through their own transmission network.

This alternative supply model for the electricity market was developed in several US states in the 1990s. A jurisdiction can found a CCA after plans are approved by vote of the local governing body, which also appoints a board to manage the programme. In California residents of jurisdictions starting a CCA are automatically enrolled through an opt-out scheme (See California Assembly Bill 117 of 2002).

Pursuant to CPUC Resolution E-4907, approved February 8, 2018 an additional 10 programmes will launch or expand in 2018, adding 3600 MW of new CCA load; a further five programme launches and/or expansions totally 1700 MW have been delayed until January 2019, under the Commission’s modified timeline for CCA launch.

Mainly due to the accessibility of solar school data compared to other community-based energy types. It should be noted though that the data in the USCEW were largely collected in 2014–2016 and are based on what was publicly available about these projects at the time.

The CEC defines behind-the-metre as smaller systems sited at residential or commercial customers with NEM connections (CEC 2017a).

Usually a third party instals and maintains the solar system on the building after signing a 10 to 30 year contract outlining fixed payments with the building owner and is entitled to any rebates as it remains the owner of the system (see Maehlum n.d.).

The IOUs started the implementation of the programme between 2016 and 2017, it runs until 2019, and has a statutory cap of 600 MW (CPUC n.d.-a).

According to the Supplemental Poverty Measure, an alternative measure to the official poverty rate, which includes not only household incomes but also other items such as geographical cost of living and housing costs, taxes and the value of government assistance programmes.

The primary programme in the US that addresses fuel poverty is the Low Income Home Energy Assistance Program (LIHEAP), through the US Department of Human Services Office of Community Services, with a total annual budget of USD 3.39 billion in 2016 distributed amongst the states according to a formula that accounts for the region’s weather, fuel prices, and low income population (HHS n.d.).

The interconnection fee for systems with a nameplate capacity up to 1MW varies per IOU and goes up to USD 145; systems over 1MW are charged USD 800 (See http://www.cpuc.ca.gov/General.aspx?id=3800).

See https://www.mcecleanenergy.org/faq-items/how-does-mce-procure-power/.

The NEM credit was initially calculated based on bundled retail rates, which makes it more attractive than compensation based merely on the utility’s avoided cost or wholesale energy prices. Crediting based on bundled rates means prosumers are compensated up to four times the market price of energy based on the portions of transmission, distribution and other “non-bypassable charges” also included on the bill (McCrary 2015).

See http://calcomsolar.com/aggregated-net-metering/what-is-aggregated-net-metering.

SGIP was started originally to reduce customer electricity demand by incentivising distributed energy after California’s electricity crisis of 2001. Only in 2007, the programme started to focus more on reducing GHG emissions and energy demand at host sites through renewable technologies.

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Title: Consumer (Co-)Ownership in Renewables in California (USA)
Authors: Felicia van Tulder
Sharon Klein
Erika Morgan
Publisher: Springer International Publishing
Book: Energy Transition
Print ISBN: 978-3-319-93517-1

Electronic ISBN: 978-3-319-93518-8

Copyright Year: 2019
DOI: https://doi.org/10.1007/978-3-319-93518-8_21

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