AUBURN, Calif. — More Californians are being turned off by solar as their PG&E bills rise. Consumers say they’re picking up more of the bill.
For years, California was eager to subsidize solar panels and other similar upgrades. Typically, when it comes to going solar, you pay more upfront while subsidies and long-term efficiency savings make the investment worth it over time.
Now that mentality is shifting as incentives from private utility companies like PG&E go away.
“I said 'I want to put as many panels as we can on the house so that we can keep our electricity bill down,'” said Paul Harman.
Cindy and Paul Harman have lived at their Auburn home for more than 30 years, raising their kids, growing their garden and installing dozens of solar panels to go green and reduce costs over time.
“When our system gets cooking and the days get longer, then we don’t pay anything for electricity at all,” said Paul.
Many homeowners like the Harmans bet on the long-term savings of going solar, but the math of going green is changing.
Typically, when solar customers generate extra electricity, they can store it in a battery or sell it back to the power grid. If they sell it, their utility company gives them credit, lowering their energy bill.
A unanimous vote by the California Public Utilities Commission in 2022 that took effect in April 2023 cut solar incentives dramatically, leaving new solar customers with smaller credits from private utilities by at least 45%.
“There were lots of benefits that used to be counted when we looked at the costs and benefits of solar, and the PUC completely changed that calculation so much so that they slashed the payments that people who have solar on their rooftops get for extra power that they sell back to the system. They slashed them by more than half and that made it economically not feasible for a lot of businesses and California families,” said former CPUC commission Loretta Lynch.
It leaves many homeowners questioning if those savings and subsidies that made the transition to solar possible still balance out the higher upfront costs. ABC10 asked Lynch why the CPUD would vote in favor of that.
“I think that the regulator has become the regulated. They are just too cozy with PG&E and when PG&E says jump, instead of asking why, they say how high,” said Lynch.
ABC10 also reached out to PG&E about the CPUC vote. They said, in part, “incentives need to be fair and equitable for all customers.”
“Because of state policy, non-solar residential customers today pay 15% more per month to subsidize the electric bills of those with rooftop solar panels,” said PG&E.
Meanwhile, the CPUC said in December 2022 that: “The decision improves the pricing structure and credits to new rooftop solar customers of PG&E, Southern California Edison, and San Diego Gas & Electric,” and “the new tariff supplements and bolsters federal incentives,” and “the decision has no impact on existing rooftop solar customers, maintaining their current compensation rates.”
Although the new metering rates only apply to new solar customers who started solar after April 2023, customers like the Harmans will be subject to the new rates… 20 years after their system was first turned on.
“What’s the incentive to go solar if you’re not going to get enough money to make it worth your while?” asked Paul.
The Harmans have already seen what it’s like to pay more for electricity. Their system was broken for more than seven months a few years into their solar use. They paid hundreds of dollars more for their utilities.
“So that shows you when you don’t have solar and you’re getting billed for electricity at the high rates, that you’re paying a lot more,” said Paul.
Solar advocates like Bernadette Del Chiaro with the California Solar and Storage Association oppose the change in incentives from private utility companies.
“It was a steep reduction in value and it took effect basically right away. There was no adjustments to the industry and so the result of that, consumers predictably stopped going solar. Our market is down 60-80%,” said Del Chiaro.
California launched the ‘Million Solar Roofs Initiative’ in 2006, jumpstarting the clean energy industry in the wake of rolling blackouts and the Enron scandal. The state hit its goal in 2019 calling for a new one – 1,000,000 solar batteries.
A year earlier, in 2018, state senator Scott Wiener passed SB 700 to incentivize solar batteries through consumer rebates managed by the CPUC. Solar advocates believe progress stopped under the Newsom administration, who appoints commissioners to the CPUC.
They say some incentives have been slashed for homeowners, businesses, schools and more.
“It’s very un-California. It’s hard to even recognize California right now when it comes to clean energy policy. We used to be the world’s leader when it comes to solar energy. People looked to us for how to build a vibrant, affordable, diverse market,” said Del Chiaro.
The change in incentivizes impacted thousands of hobs and dozens of businesses closed or left the state.
“The question right now for the solar industry of California is have we hit rock bottom yet or is there more decline to come,” said Del Chiaro.
California mandated all new home builds must have solar panels on them in 2020, adding tens of thousands of dollars to the cost of a new home. Solar advocates say, with less solar incentives, the homeowners are now shouldering those added costs for longer.
“While solar is still a good investment, you have to wait longer for the system to pay for itself. The whole idea is that you save on your utility bill and the upfront cost of the solar system pays for itself over time,” said Del Chiaro.
She says it used to take about five years. Now the range is about 10 years.
“For a lot of consumers that’s just too long to wait,” she said.
Some payment options include leasing your solar, rolling your solar into your mortgage or third-party financing if you don’t have equity.
As for the Harmans, they’re bracing for any changes coming their way and worry about other customers along with the future of solar.
California isn’t the only state to change solar incentives and efforts are underway in other states to add them back.
Nevada’s utility regulators approved restoring retail-rate net metering for their existing customers. After taking some incentives away, they saw a 32% loss in the state’s installation sector and a loss of more than 2,500 jobs.
In Arizona, a state Supreme Court ruling ended up sparing thousands of homeowners who lease their solar from paying state property taxes on it.
Solar advocates say rulings and votes like those could point California back in the right direction.
ABC10 reached out to the CPUC, PG&E and Gov. Newsom’s office. They referred us to statements online, which we referenced in this story.
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WATCH MORE: With a decline in California's solar power incentives, many wonder if it's still worth it
