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- AB 942 would affect solar credits for people who installed the panels before April 2023 — limiting their current benefits to 10 years, half of the 20 years they were promised.
- The bill’s author, Assemblywoman Lisa Calderon, is a former executive at the parent company of Southern California Edison, which has long complained about the financial credits to households that generate more solar energy than they can use.
Nearly 2 million California rooftop solar owners could lose the energy credits that help them cover what they spent to install the expensive climate-friendly systems under a proposed state bill.
The bill’s author, Assemblymember Lisa Calderon (D-Whittier), is a former executive at Southern California Edison and its parent company, Edison International. She says the credits that rooftop solar owners receive when they send unused electricity to the grid is raising the bills of customers who don’t own the panels.
Assembly Bill 942 would limit the current program’s benefits to 10 years — half the 20-year period the state had told the rooftop owners they would receive. The bill would also cancel the solar contracts if the home was sold.
Southern California Edison and the state’s two other big for-profit utilities have long tried to reduce the energy credits that incentivized Californians to invest in the solar panels. The rooftop solar systems have cut into the utilities’ sales of electricity.
The legislation, which applies to people who bought the systems before April 15, 2023, has outraged some Californians who invested tens of thousands to install the solar panels.
“We’re just trying to reduce our carbon footprint and you’re penalizing me for that?” said David Rynerson, a Huntington Beach resident who spent $20,000 to install the panels. “That’s just absurd.”
Until she was elected in 2020, Calderon spent 25 years at Southern California Edison and Edison International. Her last position was as a government affairs executive at Edison International, where she managed the utility’s political action committee.
California officials want to reduce the financial credits that households with rooftop solar panels can earn for excess energy. “It’s the utilities preserving their monopoly,” says one homeowner.
Calderon declined to be interviewed. In a statement, she said that she wasn’t acting on behalf of the utility companies.
“I introduced this bill with one goal in mind: to help lower the cost of energy for Californians,” she said.
Calderon said if her bill was enacted it would reduce electric costs for customers who do not own the panels beginning in 2026.
According to OpenSecrets.org, which tracks political spending, Southern California Edison and the other two big investor-owned utilities are among Calderon’s most generous corporate donors.
Last year, the the company gave Calderon’s campaign $11,000. Sempra, the parent company of San Diego Gas & Electric, also contributed $11,000, while Pacific Gas & Electric provided $8,000.
Southern California Edison spokesperson Kathleen Dunleavy said that the company supports rooftop solar but it also supports efforts to reduce the costs that have been shifted to customers who don’t own the panels.
She said the company’s political contributions to elected officials “are based on their shared interest in how best to safely serve SCE customers reliable and affordable energy.”
In her statement to The Times, Calderon said that “political contributions have no bearing on any policy decisions I make.”
California is now producing so much solar energy that the state must increasingly ask solar farms to stop producing to prevent overloading the electric grid. In the last 12 months, power that would have fueled 518,000 California homes for a year has been curtailed or thrown away.
Calderon is a member of a political dynasty that has held power in the blue-collar neighborhoods east of Los Angeles for four decades.
She is married to Charles Calderon, a former state Assembly speaker and former state Senate majority leader. She was elected to the Assembly seat that had been held by her stepson Ian Calderon.
Under California’s rooftop solar program, owners get a credit on their electric bills for the solar energy they produce but don’t use. The credit is based on the current retail electric rates. The value of the credits has increased rapidly as the state’s Public Utilities Commission approved rate increases requested by the companies.
In December 2022, the big utility companies successfully pressed the commission to slash financial incentives that rooftop solar owners could receive by about 75%, starting with those people purchasing the systems on April 15, 2023 or later.
The commission left in place the program for owners who purchased the panels by that date. The agency says the value of the credits given to those owners is now a leading cause of the state’s rising electric bills — a claim that has been disputed by the rooftop solar industry and dozens of environmental groups.
In a February report to Gov. Gavin Newsom, the commission suggested reducing the number of years that rooftop solar owners can receive credits at the retail electric rate — similar to what Calderon’s bill would do — as a remedy for escalating power costs. California now has the country’s second-highest electric rates.
The commission says the rooftop customers are not contributing their fair share of the costs to maintain the electrical grid, so the expense is shifted to those who don’t own the panels.
Dozens of environmental groups sent a letter this month to the chair of the Assembly Utilities & Energy Committee opposing Calderon’s bill and pointing out that the state has long said the solar contracts would last for 20 years, which is the expected useful life of the panels.
“The CPUC’s new proposal, to break energy contracts mid-stream, would be patently unfair,” the groups wrote. “It would punish the very people who California encouraged to invest in solar energy. And it would gut consumer confidence and trust in government.”
The groups pointed out that when Californians bought the systems, they signed a state-mandated legal agreement with their utility that details in the terms that the customer is eligible to receive the credits for 20 years.
Edison’s actions to prevent wildfires are under scrutiny after the devastating Eaton wildfire that killed 17 people and destroyed 10,000 homes and other structures
In California, under a policy known as decoupling, utilities don’t make more money as customers use more energy. Instead they make most of their profit by building infrastructure, including poles, wires and the rest of the grid.
In their letter, the environmental groups pointed to an analysis that economist Richard McCann performed for the rooftop solar industry that found that electric rates had risen as the utilities spent more on infrastructure.
Even though homeowners’ solar panels helped keep demand for electricity flat for 20 years, the three utilities’ spending on transmission and distribution infrastructure had risen by 300%, McCann found.
“To address rising rates, California must focus on what’s really wrong with our energy system: uncontrolled utility spending and record utility profits,” the environmental groups wrote.
A hearing on the bill is scheduled in the Assembly Utilities & Energy committee on April 30.
Cherene Birkholz of Long Beach said that she and her husband spent $22,000 on panels for their home. The couple saw the solar panels, she said, as a way to control costs so they could stay in California after they retired.
Birkholz said she believed the credits would continue for 20 years. The proposed legislation, she said, “came as a shock.”
“If I had known, I may not have made these decisions,” she said.
Dwight James of Simi Valley said that he spent $35,000 on solar panels in 2018 and another $40,000 on batteries to store the power in 2021. He said he financed the purchase with a 20-year loan and that he found it “disturbing” that the state would now back out of what it had promised.
“If you follow the money, it gives you all the answers,” James said. “My thought is that this bill is a way for the utility companies to try to hold on a little bit longer and slow the adoption of solar.”
