Solar tax credit extended; What’s next for PG&E net-metering?

This is a bit of a paste-eating (read: boring to most all but we the solar geeks) blog post, but we feel it’s valuable to share a few important updates for property owners who are considering going solar.

Federal Investment Tax Credit (ITC)

In late December, as part of the $900B Covid-19 relief package, the 26% Federal Investment Tax Credit for solar systems was extended through 2022. (It was slated to drop to 22% this year.) Even through the lens of a rah-rah solar practitioner, it’s difficult to see the relationship of our industry to the pandemic … but, we’ll take it (and, it’s a benefit that accrues to homeowners who invest in solar). Good news.

PG&E Net-Energy Metering

In August 2020, the California Public Utilities Commission (CPUC) commenced deliberations for Net-Metering 3.0. (Background: “Net-Metering” is the accounting mechanism by which PG&E, as mandated by the CPUC, is required to compensate property owners for their solar generation. From 2005 through late 2016 [Net-Metering 1.0], property owners were compensated at the full retail rate [the same price PG&E charges for electricity] for their excess solar generation. Under the current program, Net-Metering 2.0, solar owners receive full retail compensation with two changes: a nominal “non-bypassable” charge, essentially a tax or toll, that totals ~$100/year; and, a requirement to enroll in a time-of-use rate plan.)

We were recently briefed by sages at the California Solar + Storage Association regarding the timing and key, to-be-negotiated levers of what’s next (Net-Metering 3.0). Important tenets:

- It’s anticipated the sausage-making process (CPUC deliberations) will continue through 2021, with a formulated program finalized in early 2022. Thereafter, it will take three-to-six months to initiate the program. Any prospective solar owner who has submitted Phase 1 of their PG&E Net-Metering application (by that date) will be grandfathered in to the current (Net-Metering 2.0) rules. Good news.

- Reprise: Anyone who has gone solar or goes solar prior to commencement of the new program is safe (i.e., you’re enrolled in Net-Metering 1.0 or 2.0); PG&E cannot retroactively change the rules or accounting treatment.

- It is likely solar-tied storage (batteries) will be part of the new program … again, details TBD. Could be good, could be penal.

- There are three key imperatives, or consumer protections, our industry is keenly focused on: Do not touch behind-the-meter (solar generation less consumption) electricity; no solar-specific fixed charges (ala SMUD and other utilities); and, any change/new program must be gradually implemented.

One note: There is no urgency, through our lens, to go solar. Unfortunately, several homeowners each week relay they were told (by one or more solar companies) that they had to go solar by (insert a fictitious date) for (insert an erroneous reason). Don’t buy it; take your time, do your due diligence.

As always, feel free to contact us if you’d like to learn more about the above and/or if you’d like us to help you evaluate whether solar makes sense.

Purchased a home and want to add solar panels? Five considerations to ponder

This week, we have been engaged by three new homeowners to help them evaluate solar. Thereby, we begin with a simple, open-ended question: Why solar, why now? Responses vary, but generally their motive is twofold: Why not, since I just bought my home; and, PG&E’s rates are only going to go up. While we agree with the latter, we believe the former warrants consideration.

Before adding solar to your recently purchased home, here are five considerations:

1. The condition of your roof. Since new homebuyers have recently had their roof inspected, they have an objective evaluation regarding the condition and remaining life of their roof. In simple terms, if your roof has less than 10 years of remaining/warrantied life, you do not want to install solar (on such roof planes); if your roof has 10+ years, you’re in good shape.

2. Historical/future electricity use. Since new homeowners have limited (or zero) electricity use data, we recommend one of four approaches (to forecast future use and accurately size and model their prospective solar system):

• Live in your home for 12 months and, thereby, quantify how much electricity you will use.

• Wait until you have occupied your home for six months -- particularly 1-2 months of summer use, when electricity demand peaks. (Thereby, we can model 12 months of electricity demand based on your use pattern and comparable homes).

• Employ comparable homes’ electricity use (based on their vintage, neighborhood, size, occupancy, etcetera) to model your home’s future electricity use. Fortunately, we have several hundred data sets — electricity use patterns for homes in all neighborhoods in our community — to approximate future use.

• If it’s not too late, request 12 months of PG&E data from the home seller. Oftentimes, this is a futile effort, but it’s worth trying.

3. Home improvements. Stating the obvious: Many new homeowners improve their homes. Adding a pool and/or hot tub will increase your electricity use, as would replacing your furnace with an electric heat pump (an increasingly common practice for Repower homeowners). Conversely, replacing windows, adding insulation, or installing a variable speed pool pump reduces your electricity use. In all cases, we model the impact vis-a-vis solar system sizing.

4. Electric vehicle. If you own — or intend to purchase, in the next 12-24 months — an eV, you’d  want to factor future charging of your car into the sizing of your solar system. We find that eVs travel 4 miles per kWh of electricity. The math is simple: Take the number of miles/year you anticipate driving and multiply it by the percentage of charging you believe will be done at home (versus your workplace, public chargers, etc.). Then, divide the number by 4 to quantify additional electricity use (in kWh). For example, if you intend to drive 10,000 miles per year and charge your car 80% of the time at home (fueling 8,000 miles), you will consume 2,000 kWh of electricity.

5. Your electrical panel. Though adding solar does not increase your electrical demand, we need to ensure your electrical panel has sufficient capacity (or space) to accommodate the solar inverter. Furthermore, we will evaluate non-solar changes to your electrical demand — car charger, spa, swimming pool, heat pump, etcetera — to determine your panel’s amenability. (We perform load calculations and review your future electricity use with the city or county to ensure solar will work.)

 Net-net, going solar is simple, but there are a few nuances worthy of consideration … particularly if you recently purchased a home. Feel free to contact us to learn more and receive a free solar assessment.

Valley Clean Energy is here: Choice is good for solar homeowners

Change can be a good thing. Or, it can be bad. Or, somewhere in between.

Choice, however, is good. If you had one option — for anything you do or buy — you’re stuck. You have no choice and must opt for the sole solution.

Choice enables consumers to make a decision, to weigh options and decide what’s in their best interest. Choice makes markets healthy and efficient, thus benefiting consumers.

For the past few generations, Yolo County residents have not had a choice regarding their electricity: PG&E, the de facto monopoly, was it. That ceased in June with the debut of Valley Clean Energy (VCE). Though nothing changed with our electricity delivery, customer service and billing, VCE was a change that confused some. This is understandable: Consumers now had a choice.

As we’ve shared in prior posts (here, here and here), if you do not have solar panels, VCE is a no brainer: Participate and you’ll save a few bucks each month while reducing your carbon footprint. Or, stick with PG&E and pay more to an investor-owned utility for dirtier energy. Case closed.

Furthermore, if you have solar or are considering going solar, VCE is a viable option. It provides solar homeowners with a choice for how to net-meter their electricity.

When VCE commenced its solar net-metering program in June, we identified and shared a few (in our opinion) flaws to their accounting methodology. In short order, VCE staff absorbed our input, consulted the public, and amended their solar program. This efficient, transparent and productive process evidences the virtue of a publicly-controlled program. (Imagine trying to get PG&E to modify their solar program … no chance.)

Effective January 1, 2019, VCE’s new net-metering program will take effect and homeowners with solar will have a choice. Here’s a quick summary:

• If you installed solar before June 1, 2018 you will stick with your annual true-up date (that you currently employ with PG&E) and you will be enrolled in VCE’s program at your true-up.

• If you went solar after June 1, 2018, your annual true-up date will be in March.

• In both cases, your net-metering accounting will occur every month (versus once/year with PG&E). At the end of your 12-month solar accounting calendar, your true up ($) will be the same, except …

• … with VCE, if your solar system generates more electricity than you use in a given month, you will receive an additional one-cent per kWh credit.

Importantly, when you go solar, you receive “permission to operate” from PG&E and you are grandfathered in for 20 years under the prevailing (California Public Utilities Commission mandated) net-metering program. Participating in VCE’s net-metering program does not impact your 20-year utility agreement. (This is critical; we received written acknowledgement from PG&E.)

So, congratulations, you now have a choice. Options are good and, for solar homeowners, VCE will put a few extra dollars in your pocket without harming your solar interconnection agreement.

Feel free to stop by our workspace or contact us with questions. Viva community choice!

YoloShines: Yolo Crisis Nursery

As we’ve shared, every time a homeowner goes solar we donate $500 to the local nonprofit of their choice. We call this program “YoloShines,” in great part because we believe nonprofit organizations are the underlying fabric of our community — they make it shine! — and, thereby, we have a responsibility to support such groups.

Over the past year, seven Repower homeowners have selected Yolo Crisis Nursery (YCN) for their YoloShines gift; hence, we had the fortune of donating $3,500 to YCN in 2017. In an effort to shine a light on YCN and engage the community to join us in our support, here’s a quick profile of the organization.

First, a story that amplifies the impact of YCN:

About one year ago, a distraught young mom named Jess first came the Yolo Crisis Nursery.  After the birth of Jess’s second child she was home alone with her newborn and her toddler, and realized she was having trouble caring for them both by herself.  Jess’s decision to call the Nursery probably saved her baby’s life.

Over the phone, YCN staff invited Jess to bring both children to the Nursery, where we could care for them at no cost and give her a much-needed break.  Once the family arrived, the situation took a dramatic turn.  Executive Director Heather Sleuter looked at the baby and saw that he was far too listless.  She asked when he had last been fed.  Jess said she could not remember.

Heather directed one of our caregivers to comfort and care for the toddler and then drove both the baby and Jess to the hospital. 

The emergency room staff attended to the child, successfully treating him for severe dehydration.  The doctor told us the baby had come within hours of death.  Meanwhile, Jess received the medical attention she needed.  County authorities made arrangements for both children to move into temporary foster care.

While county officials and Jess worked toward family reunification, her health stabilized and the children eventually returned home.  The family was then enrolled in YCN’s Family Life Skills Program.  A Nursery staff member visited the family’s home for two hours a week for 12 weeks for hands-on parenting education.  Families who complete our program significantly increase the likelihood that they will remain together,’

Today, a year later, this family is doing well.  Jess is working and the children are happily enrolled in day care and preschool.

Wow. Thanks to Cam Stoufer with YCN for sharing the story of lives saved and changed.

All organizations have a purpose … Why does Yolo Crisis Nursery exist? The mission of the Yolo Crisis Nursery is to provide early intervention services to nurture healthy and resilient children, strengthen parents and preserve families. Our vision is that every child in Yolo County grows up in a safe, loving and stable home. The Nursery’s overarching goal is to prevent child abuse and neglect among young vulnerable children by partnering emergency childcare with wrap-around services for families in trauma or crisis. In doing so we keep children safe and families whole in our community.

In 2017, Yolo Crisis Nursery’s accomplishments included:

• Families receiving childcare services who did not become clients of CPS: 99%
• Families linked to case management counseling and community resources: 267
• Families completing referral to wrap-around services: 98%
• Children served and childcare slots provided: 178 (individual count - up 45% over previous year) and 2,342

Very significantly, 98% of the families the Nursery serves do not become clients of Child Protective Services.

Now, our punchline ... here’s how you can help (monetarily, personally, professionally): Yolo Crisis Nursery is a 501c3 nonprofit organization (Tax ID #47-1006055) which welcomes support from individuals, businesses, foundations, service and faith-based organizations in our community.  The Nursery provides care packages to our families and in-kind support is always welcome in the form of diapers, formula, clothes toys and other items for children.  Volunteer service projects occur throughout the year to maintain and enhance the Nursery facility for our children and families.  Volunteer positions are available annually on the Board of Directors and ongoing as members of the Friends of the Yolo Crisis Nursery, the fundraising and advocacy auxiliary of the Nursery.  Lastly, the community is invited to participate in the annual Krustaceans for Kids Crab Feed to support the Nursery’s programs.  This year the Crab Feed will be held on Saturday, March 24 at the Woodland Community and Senior Center from 6:00 to 9:00 pm.  Tickets and sponsorships are on sale now.  More information is available at: www.yolocrisisnursery.org.

Please join us in supporting Yolo Crisis Nursery, a shining light in our community.

Solar tax credit: Is death on the horizon?

This happened Monday at the Kentucky Farm Bureau:

“I would do away with these incentives that we give to wind and solar."

So opined Scott Pruitt, Director of the Environmental Protection Agency. (Operative word: Protection.)

Anybody with half a pulse and a room-temperature-plus IQ could have seen it coming. After all, it’s written into the Koch Brothers’ playbook, and the Trump Administration is hell bent on aborting anything created or supported by the Obama Administration.

As we expressed a few weeks ago, it would defy logic, economics and common sense if the Republic Congress (rubber-stamped by President Trump) killed the clean energy tax credit. Why deter the fastest growing industry and most vibrant job creation engine in the U.S.? To spite the previous administration? To appease petroleum companies?

I’ve been accused of being overly optimistic, an ignoramus, by colleagues who have seen this coming. No chance, I’d pout, they can’t be that stupid (to dis-incentivize property owners from going solar). Pollutin’ Pruitt’s gonna do it, my environmental friends bemoaned.

I hope they’re wrong. I hope logic prevails, common sense is applied, job creation and environmental protection trump ideology.

But, my posture that there’s no financial urgency to go solar — net-metering is here to stay; the tax credit is written in to the tax code through 2020; PG&E rates continue to escalate — holds less weight. Any property owner who is contemplating solar, and wants to ensure they earn the 30% federal tax credit, should act soon. Before it’s too late.