California pushes a new plan to cut rooftop solar incentives
(Photo: AP) Californian voters passed a ballot measure in 2016 that lowered the state’s Renewable Energy and Efficiency Sales Tax (RE/ETS) to 5%. On Tuesday, November 6—less than a week before Election Day—California Governor Gavin Newsom and the California Public Utilities Commission (CPUC) released the details of the new tax plan, which is estimated to save the state $11 billion in 2020, while increasing solar electricity by 20% over the next ten years. When implemented in 2020, the plan would lower the ETS, by 1%, to 9.5% but include an increase of the residential rooftop solar incentive rate by 5%. The incentive rate for rooftop solar will then be capped at $0.08 per watt.
The plan would establish a new, “clean” rooftop solar rebate program, which would allow solar owners to receive a $0.16 rebate for 2020 and then increase to $0.29 per watt in 2021. The $0.16 rebate, which will provide solar customers up to a 60% subsidy for solar power, will be phased-in over a nine-year period, with the new $0.29 per watt subsidy introduced in the third year and then capped at $0.26 in the eighth year. The plan would also establish a new, “clean” solar system tax credit for owners of solar installations valued at $750,000 or more.
The plan would not, however, cover all existing solar rebate programs:
• Utilities under the Public Utilities Commission would pay a 2% surcharge for residential solar customers, which would provide a rebate of roughly $40 per system.
• The CPUC’s Office of Public Interest Utilities would provide a $40 per home solar rebate for “homes that have solar power connected to a home system, or to a system of more than ten individual photovoltaic solar systems, with a gross system value of either $50,000 or more,” which would be phased-in over a five-year period. The new $40 per household rebate would be capped at $45 in the third year.
• State employees with the Public Employees Retirement System (PERS) would receive a 2% solar power rebate, which would be reduced to 1% under the new plan. The solar power rebate,