Senate Bill to transition California to 100 percent clean energy moves to full assembly

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Advancing to full assembly late last week in California was Senate Bill 100, historic legislation to transition California to 100% clean electricity by 2045, sending it to the full Assembly for a vote. Earlier in the day, advocates delivered more than 38,000 messages and signatures in support of the legislation from a range of stakeholders, including health and environmental advocates, clean energy industries, business communities, and environmental justice organizations.

“On this Fourth of July, as we sing about beautiful, spacious skies, let’s commend the Committee on its visionary decision to clear those skies and power California’s future with 100 percent clean electricity,” said Michelle Kinman, clean energy and transportation program director with Environment California. “We applaud Chair Chris Holden and the Committee for acting to create healthier communities today and better lives for our children.”

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“We are excited California is one step further on the path of creating new jobs, cleaning our air and powering our homes, businesses and cars with clean, zero-carbon energy. Reducing carbon emissions and air pollution by transitioning away from fossil fuels is one of the most important actions our country and world must take to avoid the worst consequences of climate change,” said Laura Wisland, senior energy manager at the Union of Concerned Scientists.“We appreciate the leadership shown by California legislators to keep our clean energy momentum going strong.”

“This Independence Day Californians can celebrate being one step closer to energy independence and freedom from fossil fuels. As SB 100 moves to the Assembly for a floor vote, we urge all Assembly members to reflect on this historic opportunity to advance renewable energy and leave a cleaner and safer climate for generations to come,” said California Interfaith Power & Light executive director Susan Stephenson.

— Solar Builder magazine

California to launch three programs to improve low-income community access to solar

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Right on cue after our Install Inequality feature this week, the California Public Utilities Commission (CPUC) adopted three new programs to promote the installation of solar energy to serve customers in disadvantaged communities.

“Transitioning to a clean economy must include all Californians. Targeting solar investments in low income and disadvantaged communities will help ensure that all Californians have access to all the benefits of solar, whether on their roofs or nearby in their neighborhoods,” said Commissioner Martha Guzman Aceves.

The programs approved include

1) The Disadvantaged Communities – Single-family Solar Homes (DAC-SASH) program, modeled after the existing Single-family Affordable Solar Homes (SASH) Program, will provide up-front financial incentives toward the installation of solar systems for low income homeowners. The program will be available to low income customers who are resident-owners of single-family homes in disadvantaged communities. The incentives will assist low income customers in overcoming barriers to the installation of solar energy, such as a lack of up-front capital or credit needed to finance solar installation.

2) The Disadvantaged Communities – Green Tariff (DAC-Green Tariff) program will provide a 20 percent bill discount to customers in disadvantaged communities. This will allow customers to choose clean energy options without the need to own their home and without the cost of installing their own solar systems. The program is modeled after the existing Green Tariff portion of the Green Tariff/Shared Renewables Programs. It will be available to customers who meet the income eligibility requirements for the California Alternate Rates for Energy (CARE) and Family Electric Rate Assistance programs.

3) The Community Solar Green Tariff program is similar to the DAC Green Tariff program, and will also provide a 20 percent bill discount. This program will allow primarily low income customers in disadvantaged communities to benefit from the development of solar generation projects located in or near their communities. The communities will work with a local non-profit or local government “sponsor” to organize community interest and present siting locations to the utility; the sponsor can also receive an incentive for its efforts.

Both the DAC-SASH and DAC-Green Tariff programs will be funded first through greenhouse gas allowance proceeds. If such funds are exhausted, the programs would be funded through public purpose program funds.

— Solar Builder magazine

Three possible shifts in California’s solar market after historic rule

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When the world’s fifth largest economy mandates the use of your product, as is case for solar in California starting in 2020, outlooks can shift dramatically. Shocking, I know. Here’s a quick rundown of some of the implications.

1. GTM boosts residential forecast by 14 percent

Solar’s growth stall has largely been because of California’s growth stall. That lagging should now be a thing of the past. On net, the implementation of this rule increases our base-case residential forecasts by 14% from 2020-2023E – an upside of nearly 650 MW over the same timeframe. The California Energy Commission (CEC), estimates nearly 75,000 new homes are expected to be built statewide in 2020. Based on that analysis, new-build solar will account for 23 percent of new installations in 2020 — or 222 megawatts. New build residential homes will account from 18-23% of total solar build-out from 2020-2023E. Though multi-family units are also included in this ruling, GTM excluded these customers from this analysis given their typical inclusion in its “non-residential” sub-segment.

2. Good bye soft costs?

Soft costs such as permitting, marketing and customer acquisition make up about two-thirds of a solar installation costs. Many of those will be removed or reduced dramatically in this equation, which make a huge impact on the economics of residential solar.

So that’s the good news, but who shares in all of this upward momentum is an open question. How much will homebuilders take on themselves? Will most solar companies focus on the new build market, and what will those margins be? What becomes of the retrofit business model? These questions aren’t meant to imply bad news for anyone (maybe every single stakeholder wins!), but a rule change this dramatic can be expected to make a dramatic change somewhere in the status quo.

RELATED: Solar Installer Survey: Two-thirds will absorb solar tariff costs instead of passing to customers as confidence climbs

3. The rise of solar shingles and BIPV?

What if homebuilders gravitate right to BIPV products? According to Freedonia Group analyst Matt Zielenski, demand for solar roofing products – such as those made by Tesla, GAF Materials, and CertainTeed – will see strong growth going forward as builders and contractors in California install these products on newly built homes.

“Solar roofing products have several advantages over traditional roof-mount solar panels,” says Zielenski. “One of these advantages is that they are more attractive than solar panels. Most solar roofing products look like traditional roofing, such as asphalt shingles or roofing tiles. Their ability to ‘blend in’ with the rest of the structure can add to the curb appeal and value of a home.”

As a result, US demand for solar roofing is projected to reach $2.2 billion in 2022, and continue to grow strongly through 2037. For more information on the U.S. solar roofing market, see Freedonia’s new study Solar Roofing in the US by Application and Region.

RELATED: Module Evolution: What big-time PV improvements will boost panel efficiency?

4. The end of the traditional grid?

I know we said three in the headline, but this one is more us thinking out loud, so consider it a bonus. We are excited to see the very long-term results of this initiative. Sunrun CEO Lynn Jurich once asked “what’s the fastest way to install 1 MW?” and then expounded on the possible benefits of shifting the concept of large-scale PV from the plodding and planning needed for a gigantic utility-scale system to a plan that nimbly deploys a ton of small systems at once that equals the same MW-scale right at the point of demand. This is a giant lab experiment / case study that moves this thought experiment into reality, and could show what a true widespread, distributed generation grid could look like. This is the most exciting part to us.

— Solar Builder magazine

Report: Solar retrofit market in California hitting saturation point

Despite gaining ground in 25 states in the country, the overall residential solar market declined in 2017 due in large part to a decline in the saturated California market. We noted this at the time and then somewhat glossed over it to highlight the countrywide expansion, but a new report from Lumidyne Consulting raises concern over just how saturated the California market is and what the implications could be.

The analysis forecasts that if current adoption patterns hold, “installations of residential [solar] would be expected to drop from a peak of about 149,000 systems/year in 2016 to ~92,000 in 2018 and 46,000 in 2020 (a 69% drop relative to the peak in 2016).”

Lumidyne Consulting LLC

The paper notes that after a decade of explosive growth, in 2017 the residential solar market in California saw its first decline in annual installations, a 22% drop relative to 2016. The white paper suggests this decline is likely due to the beginning of market saturation in the residential solar retrofit market, which peaked in December 2015 for all investor-owned utilities in California and has since trended downward.

The paper illustrates how housing growth in California, combined with strong incentives or initiatives to install solar on new construction homes, could help mitigate the decline and avoid job losses in the state. The analysis underscores the importance of initiatives to encourage construction of Zero Net Energy (ZNE) homes in California, which has a goal of 100% of new homes being constructed to a ZNE standard by 2020. However, it suggests that “the growth rate of the percentage of new homes installing solar PV would have to accelerate to materially mitigate the current pattern of decline in the retrofit market,” since currently about 20% of new homes install solar.

The paper also applies to other states, and notes that “unless steps are taken to mitigate the effect, one can expect a ripple of ‘boom and bust’ waves to propagate across the country as each [solar] retrofit market ultimately becomes saturated.”

Here’s the white paper if interested in the findings.

— Solar Builder magazine

California to standardize disclosures for solar contracts, protect solar customers

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Gov. Brown signed AB 1070 (Gonzalez Fletcher) into law last week. The bill previously unanimously passed the California Assembly and Senate. AB 1070 creates new and important consumer protections measures, including standardized and simplified disclosures, for all residential solar customers.

“CALSEIA greatly appreciates the efforts of Assemblywoman Gonzalez Fletcher to protect consumers and applaud Governor Brown for signing AB 1070,” said Bernadette Del Chiaro, Executive Director of the California Solar Energy Industries Association (CALSEIA). “We support this new law because it simultaneously helps eliminate confusion in the marketplace while also reigning the handful of errant contractors. It does this without inadvertently harming the ethical California business men and women who are critical architects of California’s clean energy future.”

AB 1070 requires Contractors State License Board (CSLB) on or before July 1, 2018, to develop a disclosure document that must be provided to consumers prior to sale, finance or lease of solar installation. In addition, the law requires the California Public Utilities Commission to develop standard inputs for calculation and presentation of energy savings to potential buyers.

“We should make it as easy as possible for Californians to use solar power and other clean-energy sources,” added Assemblywoman Gonzalez Fletcher, author of the bill. “But it’s very expensive and very intimidating for homeowners to invest in solar power. It’s a challenge figuring out the honest companies from the ones trying to rip you off. The more protection we can provide consumers, the more comfortable they’ll be purchasing solar power at a time when each of us must do our part to combat climate change.”

California solar thermal incentives officially extended until 2020

Last week, the Governor previously signed two other important consumer protection bills, SB 242 (Skinner) and AB 1284 (Dababneh), which provide additional consumer protections for Property Assessed Clean Energy (PACE) financing of clean energy projects. SB 242 mandates PACE providers call homeowners to ensure they understand the terms, and AB 1284 requires the Department of Business Oversight to regulate PACE providers and that PACE lenders to ensure borrowers have the ability to repay their loans obligations.

Since solar investments are independent, voluntary choices made by consumers, consumer protection is considered the cornerstone of the solar industry. With the signing of these three strong bills – AB 1070, SB 242 and AB 1284 – California took major steps to increase protections for consumers in the 2017 legislative session.

— Solar Builder magazine