HOME > News

California's Rooftop Solar Mandate Illuminates Potential Pitfalls for National Energy Policies

published: 2023-11-13 16:04

The California rooftop solar policy sends a cautionary signal to the nation, as discussed by four expert panelists during the recent pv magazine Roundtables US 2023 live event. According to their insights, energy storage is poised to take on a progressively vital role.

Residential solar has faced turbulent times in the last year, with high interest rates tightening the financial leeway for homeowners. Notably, policy shifts such as California's net energy metering (NEM) 3.0 have added pressure to the value proposition for rooftop solar customers, leading to a significant dip in demand in recent months.

The repercussions are evident in the solar market, with major publicly traded solar stocks plummeting by over 75% in the past year. Key markets, including California, have witnessed a decline in demand ranging from 40% to 80%, with the full impact of NEM 3.0 yet to be fully assessed.

While California has traditionally been a solar success story, that narrative may be shifting. During the pv magazine USA Roundtables US 2023 live event, a panel of four experts in distributed solar and energy storage shared their insights on how the market is grappling with policy changes and drew lessons from California's recent challenges.

The panelists, featuring Carina Brockl, Chief Revenue Officer at Aurora Solar, Blake Richetta, Chairman and CEO of Sonnen, Walker Wright, Vice President of Public Policy at Sunrun, and Bernadette del Chiaro, Executive Director of the California Solar and Storage Association (CALSSA), provided a comprehensive perspective.

Wright initiated the discussion by acknowledging the pivotal role net metering played in propelling the California market, which constitutes approximately 50% of the national rooftop solar market. Net metering, coupled with federal policies and California state incentives, formed the backbone of rooftop solar, creating a compelling value proposition for customers.

Del Chiaro emphasized, "The predominant renewable energy sector in California is distributed [solar]." However, she painted a grim picture, stating, "What we've just witnessed is not merely a seismic shift... we're anticipating an 80% plunge in sales due to the new NBT tariff. The upcoming months seem to be casting a shadow rather than bringing brighter prospects."

Despite the current challenges facing residential solar, there are factors that could counterbalance the market downturn. Brockl pointed out that while inflation has been on the rise, electricity prices have escalated even more, sometimes doubling the inflation rate. This dynamic makes the proposition for rooftop solar customers slightly more enticing as a safeguard against escalating utility rates, even if the initial savings are minimal or even negative.

Richetta, the representative from energy storage provider Sonnen, struck a more optimistic tone compared to his fellow panelists. Sonnen, with its origins in Germany, faced a parallel scenario when the country phased out its feed-in tariff policy, causing a contraction in the rooftop solar market. However, since then, the market has rebounded, and Germany boasts some of the highest rooftop solar penetration rates globally.

According to Richetta, "There was a market demand to leverage solar power and integrate it seamlessly with grid operations... and to convert an intermittent form of generation into something stable and dispatchable."

News From PV Magazine

announcements add announcements     mail print