Sunny San Diego fights new utility charges on rooftop solar

The city of San Diego said changes to rooftop solar tariffs proposed by California utilities would hamper the renewable energy market and interfere with local plans to address climate change.

The city, in filings Tuesday with state utility regulators, took issue with a request from San Diego Gas & Electric to add a monthly "grid connection" fee for solar customers as well as special charges based on peak periodic energy use, regardless of overall monthly electricity consumption.

California utility regulators are reconsidering the current "net metering" tariff that provides bill credits for solar energy at the full retail electricity rate. SDG&E says grid-connected solar customers are avoiding their fair share of costs for infrastructure and utility programs, forcing it to increase bills for nonsolar customers.

Attorneys for the city acknowledged the need for all customers to support the grid that serves them, but said the new charges by SDG&E "would be discouraging to sustained growth" of solar. The city stressed its own plans to offset more city government energy demands with solar, as well as an interest in keeping open cost-effective options for residents and businesses in San Diego.

In its own regulatory filing, SDG&E said its tariff is more closely tied to the utility's cost of providing service and would still provide some financial benefits to solar customers. The utility encouraged the California Public Utilities Commission to reject "status quo-based proposals" from the solar industry, a major beneficiary of current tariffs, and other interest groups including federal government offices that have deployed solar.

Major rooftop solar providers including SolarCity and Sunrun have accused California's regulated utility monopolies of trying to kill off the rooftop solar industry by raising fees, in an effort to avoid competition and ensure profits from infrastructure projects under an outdated business model.

The solar industry favors extending current solar tariff provisions for several years to help the industry overcome the expiration of a key federal tax incentive at the end of next year.

The city of San Diego indicated it might support middle-ground proposals, such a tariff introduced by the state Office of Ratepayer Advocates. That proposal would phase in charges based on the generating capabilities of individual rooftop solar arrays -- though the city says the transition should be delayed and proposed fees reduced.

The city endorsed approaches for calculating the cost and benefit of rooftop solar that are favored by the solar industry , and take into consideration avoided utility costs and societal benefits. SDG&E opposes those standards and cast doubt on the notion that its costs would decrease from the proliferation customers who generate their own rooftop solar energy.

Current solar customers can hold onto the full retail credit for solar energy for the first 20 years of service, under grandfathering provisions already approved by the utilities commission. The current tariff could expire as soon as early next year.