CMTA Voices Concerns on Solar Proposal

By CMTA Staff

Capitol Update, Jan. 6, 2006 Share this on FacebookTweet thisEmail this to a friend

The Schwarzenegger Administration and state regulators are pushing ahead with plans for a roll-out of the "California Solar Initiative" or "CSI" by 2007, despite serious concerns expressed by stakeholders about the program and critical implementation issues that need to be addressed in 2006.  (The "Initiative" is a proposal before regulatory agencies and not destined for the ballot box.)

The goal of the CSI is to place one million solar energy systems, or the equivalent of 3,000 megawatts (MW) of capacity, on new or existing residential and commercial buildings by 2018 through a declining rebate program that grants rebates on the installation of solar energy systems.

CMTA remains skeptical that a program implemented in the state of California alone can impact the market in such a way that, after a 10-year program with declining rebates, solar photovoltaic technologies will be cost competitive with other demand reduction or supply sources.  The potential costs and benefits of the CSI remain of paramount importance to large customers who are already burdened with the highest electric rates in the West.  CMTA believes that state policymakers should be pursuing alternatives that drive down rates, not raise them.

In comments filed on January 3, CMTA urged the California Public Utilities Commission (CPUC) to finalize and approve a methodology that will allow policymakers to assess and compare the cost-effectiveness of solar technologies, distributed generation, combined heat and power and energy investments over time.  Furthermore, a clearly defined cost-benefit methodology to analyze the impacts on participants and ratepayers alike would allow policymakers to properly evaluate CSI program successes and failures, and most importantly, make the necessary mid-course corrections.

CMTA also urges the CPUC to adopt cost allocation principles as part of the CSI decision and an "equal percent of distribution rates" as the allocation methodology, thus ensuring that large industrial customers do not bear a disproportionate share of program costs.  Large industrial customers will not receive any direct benefits from the program and, therefore, should not be expected to pay a significant portion of the costs. 
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