New Green Option (Community Solar) FAQ
All responses provided reflect the proposal as filed, which is subject to change and subject to approval by the CPUC.
PG&E proposes two new options. Under one, customers can pay for the output from a pool of small to mid-sized solar projects within PG&E’s service territory. Under the other, customers can pay for the output from a solar project near them of their choosing. Under either option, in response to customer enrollment under the program, PG&E will contract for energy from newly developed small and mid-sized solar projects located within its service area. Participants will pay the full cost of the new solar energy supplies they support. Those additional supplies—provided by third-party developers—will be incremental to the clean energy that PG&E purchases for all customers to meet the state’s Renewables Portfolio Standard. Participating customers will receive credits for avoided PG&E generation costs. The solar price will remain stable, while the bill credit will track with PG&E’s class average generation rates.
SB 43, the Green Tariff Shared Renewables Program bill, was approved by California’s state legislature and signed into law in late 2013. It requires California’s major utilities to propose a voluntary shared renewables program to the California Public Utilities Commission by March 1, 2014 that conforms with the requirements of the bill. PG&E had already proposed a shared renewables program in April 2013, and filed modifications to it to conform with SB 43 in December 2013. For example, SB 43 required caps on the amount of renewables any one customer can subscribe to, and set a statewide program cap of 600 MW, which effectively increased PG&E’s program size from 250 MW to 272 MW. PG&E’s proposal, as described in this document, remains largely the same.
At the outset, PG&E will provide clean energy procured from recently developed and operating small and mid-sized solar energy projects located within its service territory. However, as customers enroll, PG&E will execute long term contracts for new solar facilities with the same characteristics – small and mid-sized projects located within PG&E’s service territory. Once these projects develop, typically over 24-30 months, they will produce the source energy for program participants. PG&E will sign contracts for projects located near to where customers are enrolling, as long as the overall price can be maintained.
The energy for this program will be generated inside California, and specifically within PG&E’s service territory.
Customers would need to commit to 1 year when they enroll in the program (with an initial 60 day “cooling off” period). After that, there is no additional commitment. The program will be open to new enrollees for 5 years or up to a total program cap of 272MW of solar capacity, whichever occurs first.
Cost and Availability
Customers will pay a fixed price per kwh for the solar energy, plus additional charges for program administration and other costs related to solar energy. However, customers will also receive a bill credit for generation costs that PG&E avoids, adjusted to reflect the higher on-peak value of solar energy. The difference (net cost) is likely to start at about three to four cents per kwh, but diminish over time if PG&E’s overall generation costs increase.
These types of community solar programs are relatively new, but growing. In fact, the majority of utility green programs introduced within recent years have been community solar programs. Still, these programs come in various shapes and sizes, and there aren’t very many comparable programs to which PG&E’s offering can be contrasted. Some are priced higher, and some, due to embedded subsidies or other incentives, are priced lower.
At this time, renewable energy costs more to generate. However, it’s important to note that since the customer is credited with the generation costs that PG&E avoids, the customer’s net participation price is expected to diminish over time.
Why should customers pay more for this program, when they can get a solar system on their roof and save money from day 1?
First, many customers can’t or don’t wish to have a solar system installed on their roofs. For example, customers may not own their home, or the roof configuration may not be suited to solar, or the customer may want the flexibility that a significant capital investment on their home or building doesn’t provide. Additionally, rate-embedded incentives for solar systems on customer roofs may change over time as the legislature and Commission re-evaluate these incentives.
Nothing. All costs will be borne only by customers who volunteer to enroll in the program.
This program provides 100% of the energy a customer consumes, and is therefore by definition a “bundled” (supply and delivery) product.
How do I sell you electricity from my own solar electric system to those participating in the program?
PG&E will not sign contracts for existing projects under this program, PG&E will procure additional solar energy from new projects sized 20 MWs or below within its service area using a number of different procurement tools. If you are in a position to develop a new project that can provide solar electricity at a competitive price, then you may be eligible to participate as a supplier under this program. For more information, please see www.pge.com/greenoption, which will be updated as more information becomes available.
PG&E expects a decision from the California Public Utilities Commission (CPUC) by July of 2014. We anticipate the program will launch sometime in 2015.
PG&E and the Green Option
This program is separate from and incremental to PG&E’s Renewables Portfolio Standard (RPS) requirements. However, if customers drop off the program after PG&E has procured new supplies on their behalf, the additional resources will be provided to PG&E’s regular bundled customers.
Yes. This program will be authorized to serve up to 272MW of subscriber load, with no less than 50% being reserved for residential customers. Furthermore, the program will be open to new enrollees for no more than 5 years. PG&E may seek to expand and/or extend this program through a filing with the CPUC.
Is this just an attempt to undercut existing and proposed Community Choice Aggregation organizations?
No. As noted above, PG&E is responding to the stated desire of many customers for more renewable energy options. PG&E is offering the Community Solar program to all bundled electricity customers throughout its service area, regardless of whether they also have the option to buy electricity from CCAs.
PG&E customers have been asking for a renewable energy option for some time. Now that PG&E’s other voluntary “green” program, the ClimateSmart program, has ended and a comprehensive evaluation has been completed, we believe that it is time to incorporate the lessons learned from that program and offer our customers the renewable energy option for which they have been asking.
PG&E’s original Green Option filing proposed purchasing renewable energy certificates (RECs) to match the portion of each participating electric customer’s energy that is not covered by PG&E’s eligible renewable energy deliveries. The new proposal ensures that new incremental solar resources are built in response to customer enrollment. It reflects suggestions from a number of stakeholders with which we engaged in settlement discussions.
PG&E filed an application to the California Public Utilities Commission for a voluntary green power program in April 2012. In early 2013, PG&E filed a Settlement Agreement with several parties to the proceeding. Then, in 2013 the state legislature took up Senate Bill 43, the Green Tariff Shared Renewables Program bill, which passed and was signed into law in September 2013. The CPUC is expected to rule on our proposal by July 2014. Introducing a major new rate option is always a significant and time-consuming process.
The California Public Utilities Commission (CPUC) regulates investor-owned electric and natural gas utilities operating in California, including PG&E. PG&E must receive approval from the CPUC in order to offer new tariffs and services, such as the proposed Green Option. There is a regulatory process that allows for stakeholder and public input. Therefore, PG&E’s proposed program design for the Green Option is subject to change and approval by the Commission.
• April 24, 2012: PG&E files Green Option Application
• Aug 2, 2012: ½ Day Workshop
• Aug 24, 2012: Common Outline of Issues Sent to CPUC
• Sept 26, 2012: Scoping Memo Issued
• Oct 19, 2012: Intervenor Testimony Served
• Nov 9, 2012: PG&E’s Rebuttal Testimony Served
• Mar 26, 2013: Settlement Conference
• April 11, 2013: Motion to Adopt Settlement Filed
• July 31, 2013: Assigned Commissioner Ruling to Consolidate PG&E and SDG&E Green Tariff Applications
• November 15, 2013: Opening Comments (PG&E and SDG&E)
• December 6, 2013: Revised Testimony (PG&E & SDG&E)
• December 20, 2013: Reply Comments (ORA & 3rd parties)
• January 3, 2014: Reply Comments (PG&E and SDG&E)
• January 10, 2014: Rebuttal Testimony, and SCE Application due
• January 21, 2014: Surrebuttal Testimony
• January 28 - February 5, 2014: Hearings
• February 21, 2014: PG&E files Enhanced Community Renewables proposal
• March 7, 2014: Opening Comments
• March 14, 2014: Reply Comments
• March 21, 2014: Concurrent Opening Briefs
• Q2, 2014: Proposed Decision
• June 30, 2014: Commission Decision
For Suppliers: PG&E will post information for potential renewable energy suppliers here when available.