A legal fight in California could determine whether the state will meet its clean energy and climate goals – or whether power companies’ greed could prevent millions of hardworking residents from reaping the many benefits of rooftop solar.
On January 29, EWG and two other environmental groups filed an appeal with California's Supreme Court over a ruling that rubber-stamped the state’s misguided solar policy. Our appeal argues that the ruling bent over backward to uphold the policy, which state regulators approved following a request from California’s three largest utilities.
The policy, and the ruling upholding it, threaten the growth of affordable, renewable energy in California.
And showing that irony is alive and well, the same utility regulators who approved the plan to impede solar power’s much-needed expansion are now arguing in unrelated litigation that California faces an electricity supply crisis and must generate more energy.
How do we meet that crisis? By finding ways to maximize, not minimize, a diversified energy portfolio with a heavy reliance on clean energy like solar and wind. California needs more, not less, rooftop solar to meet its goal of 100 percent clean energy by 2045.
But rooftop solar installations have plummeted by more than 80 percent just during the time between regulators’ approval of the plan and the court’s ruling upholding it.
Going back to court
At issue in the Supreme Court case is the three environmental group’s challenge to the solar policy approved last year by the California Public Utilities Commission, or CPUC. The state’s three investor-owned monopoly utilities, led by Pacific Gas & Electric, asked the commission to back its plan to hike fees for customer-owned solar – its only real competition.
The CPUC has long been effectively an extension of the utilities, almost always approving whatever rate increases, clean energy restrictions and other obstacles they can dream up. And the utilities pursue these policies to protect and grow their profits, not to benefit captive ratepayers.
With solar, the CPUC signed off on the utilities’ plan to slash the credits rooftop solar owners could get from their electric company for the surplus energy they generate and sell back to the grid. The credits allowed households to lower their monthly electricity bills.
The decision immediately put the brakes on rooftop solar’s growth in the state, as EWG warned. Recent developments back us up. Experts say 75 percent of California’s once-thriving rooftop solar installation companies face a “high risk” of bankruptcy. At least 17,000 well-paid solar jobs have also been lost.
All of this is due to the CPUC’s disastrous decision.
EWG, the Center for Biological Diversity and the Protect Our Communities Foundation sued in the California Court of Appeals over the CPUC's approval of the plan.Oral arguments took place December 13, and the court upheld the plan.
Our key arguments
We think the appeals court deferred inappropriately to the CPUC's decision and failed to acknowledge important legal steps that should have led to a rejection of the policy.
A key issue we’re asking the Supreme Court to review in our just-filed appeal is the CPUC’s failure to assess the far-reaching benefits of widespread customer-owned rooftop solar. Instead, in approving the utility’s plan, the commission looked at a narrow set of economic factors only. We’ll argue this violates the CPUC’s duty under state law to look at a broader range of benefits.
As adopted by the CPUC, the revised policy reduces by almost 75 percent the compensation that rooftop solar owners get for the clean power they generate. That’s a huge disincentive for other people to install solar and will further shrink the industry.
The appeals court neglected to heed our warning that the CPUC also failed to meet a duty to consider the barriers facing would-be rooftop solar customers in disadvantaged communities, areas where people already struggle to pay sky-high utility bills.
California’s confused position
The CPUC, and therefore California, will defend the solar policy approval in the Supreme Court just as the state tries to call for a greater energy mix in a separate legal case.
EWG, Friends of the Earth and Mothers for Peace have a lawsuit ongoing in the U.S. Court of Appeals for the 9th Circuit challenging a separate decision by the state to extend the life of the dangerous, outdated Diablo Canyon nuclear plant. We believe that solar and other clean energy can make up for the electricity generation lost by shutting the plant.
In that lawsuit, California is arguing – apparently with zero self-awareness – that the state is in the midst of an energy crisis and needs to generate more electricity. Oral arguments in that case were held on January 10 and the court has not yet issued a decision.
Solar is one of the energy leading solutions, but California can’t even seem to agree with itself on the right path forward. If we’re successful in these two legal challenges, we can right the course of the state’s clean energy future.
