Gov. Schwarzenegger Signs Bill to Raise Net-Metering Limit

Published Feb. 26, 2010

California Gov. Arnold Schwarzenegger, saying that solar adoption in the state is exploding, has signed into law a measure increasing the cap on total net-metered electricity generation that utilities must accept from owners of solar photovoltaic systems and other renewable sources.

PHOTO CREDIT: SUNPLUGGERS.COM
Net metering allows solar PV owners to
receive credits for producing more
electricity than they use.

"We're celebrating a bill today that is great for the environment and great for our economy," Mr. Schwarzenegger said while standing with other dignitaries atop a Macy's store in Culver City that draws some of its power from a solar-electric array.

Assembly Bill 510, which was introduced by state Rep. Nancy Skinner, D-Berkeley, and co-authored by state Sen. Christine Kehoe, D-San Diego, doubles the amount of rated generating capacity for which state-regulated utilities must offer net-metering contracts.

Net metering is a billing arrangement that accounts for the intermittency of production from solar photovoltaic (and wind-energy) systems. Solar PV owners often find that their systems produce more electricity during certain months than their household or business uses. Net metering allows them to receive credits for this overage at the same retail electricity rate they pay. In other months, the systems generate less electricity than is used, and the customer owes money on an electricity bill.

These billing variations are "trued up" or "zeroed out" periodically, often annually. Any credits earned from delivering electricity into the grid are applied toward any money owed, and the customer pays the net amount. In the past, any surplus generated on an annual basis in California was forfeited; another recently enacted bill allows renewable-energy owners to either roll over these credits another year or be compensated for the electricity.

The enactment of AB 510 clears the way for many more new solar owners to be signed up for net metering.

"I'm proud that California is the undisputed leader when it comes to solar energy," Mr. Schwarzenegger said at the signing ceremony. "There's no one even coming close. And the sad story of course is that the United States as a country hasn't really woken up and gone in that direction."

The governor said the new law will have a multiplier effect economically.

"This is also about job creation. This is also about being independent of foreign oil. This is good for the environment, this is good for the economy – for everything," Mr. Schwarzenegger said.

He was introduced at the ceremony by Julie Blunden, vice president of public policy and corporate communications at SunPower Corp., a California-based manufacturer of solar PV equipment. In 2009, SunPower was the leading supplier to the California residential solar market.

"We've gone from 40 people five years ago to more than 600 in California today," Ms. Blunden said. "We're looking at putting manufacturing back into California because we have now, with this bill, a long-term solar market in the state."

In California, a wave of new solar installations at schools is getting under way this year.

"The schools are thinking about saving teachers' jobs using solar," Ms. Blunden said. "If you can lower your cost of electricity using solar on your roofs, folks like the Los Angeles Unified School District have more money left to keep teachers teaching."

She added that the bill ensured that "the voices of solar customers were heard. They want solar today, and this bill allows us to go forward on an extended basis."