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A Brief History of California’s Solar Agreement, Net Energy Metering

Policy
Solar contractor installing a panel on a roof

As we see the devastating effects of climate change across the globe, most recently in Texas where communities were suffering in freezing temperatures without water or power for days, it has become clearer than ever that we need to transform our power supply to renewable energy in order to increase resiliency. This past summer, California experienced the opposite, where sky high temperatures and demand for air conditioning resulted in rolling blackouts for California residents. In a time where it is crucial to increase the deployment of renewable energy, the United States’ largest solar market, California, is under attack. What happens in California will likely be the example for other states, and this is a crucial battle that we’re on the front lines of right now. 

The success of rooftop solar relies heavily on net energy metering (NEM), a solar producer’s agreement with the electric utility company. At a high level, NEM is a billing structure that allows solar customers to sell their excess electricity back to the grid. The amount is then applied to their utility bills, leaving the solar customer to pay the net amount of energy used. California’s first solar agreement, known as NEM 1.0, was extremely successful and accelerated the transition to solar for California residents, businesses, schools and municipalities. Since then, investor-owned utilities (IOUs) across the state have continuously attacked rooftop solar, proposing egregious policies that would make solar economically infeasible. In 2016 the second solar agreement rolled out initially in the San Diego Gas & Electric utility territory, and made its debut for Pacific Gas & Electric (PG&E) and Southern California Edison in 2017. This successor tariff is known as NEM 2.0, and after a tough battle against the utility companies, the California Public Utilities Commission decided that the new solar rate would be similar to the first, maintaining the major benefit of allowing customers to sell electricity back to the grid at retail rates. However, NEM 2.0 required all solar customers to transition to a time-of-use (TOU) rate and non-bypassable rates. Under a TOU rate, a customer is charged different rates based on the time of the day with designated on peak and off peak times. The highest rates are during peak demand, which is late afternoon and early evening, while off peak times occur early in the morning and late at night and have the lowest cost. The new rate structure under NEM 2.0 has serious implications for solar customers, because it changes the value of the energy sold to the grid based on the time. This means that in order to get the highest NEM credits, customers need to sell the bulk of their energy during peak hours. Although NEM 2.0 is substantially less beneficial to solar customers compared to its predecessor, it still retained the major benefits of being able to sell energy back to the grid. Solar companies even began to adapt to TOU rates by designing solar systems to face west in order to capture the maximum energy possible during the late afternoon. Now, California’s IOUs are attempting to make modifications to net metering, ushering in NEM 3.0. 

As details of NEM 3.0 continue to unfold at the California Public Utilities Commission, it is clear that the IOUs are calling for drastic cuts to NEM. The California Solar and Storage Association (CALSSA) estimates that the economic value of going solar will be reduced by 50-75 percent with the IOU’s proposed changes. Decisions made during these proceedings will not only affect new solar customers, but existing customers as well as the IOUs have proposed removing grandfathering periods for current customers, essentially forcing all solar customers onto NEM 3.0. 

With the understanding that NEM 3.0 could kill rooftop solar and that California is a leader and looked to as a model for shaping renewable energy programs, it is not an understatement to say that we are fighting to save solar. We are calling on organizations to sign this net metering letter and individuals to sign this petition, by early April, which will be sent to Governor Gavin Newsom and the California Public Utilities Commision. 

Our founder, Tara Hammond, began a small local coalition to save rooftop solar in California last year and the coalition has quickly grown to a statewide grassroots effort, with more than 70 organizations being involved. To learn more or to join the battle, please reach out to our Climate Justice Policy Advisor, Karinna Gonzalez at karinna@hammondclimatesolutions.com.

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Solar advocates protesting in front of the state capitol

California Agency Proposes an 80 Percent Reduction in Benefits for Solar Customers

Over the course of this year, Hammond Climate Solutions has released nine blogs, numerous toolkits with calls to action and participated in countless meetings, presentations and webinars to raise awareness about how the monopoly utilities are trying to kill rooftop solar in California. We managed to help grow a local coalition consisting of cities, elected officials, environmental and climate justice organizations and schools. San Diego County residents have made their voices heard, and the message is clear - we want to see solar continue to grow. The highly-anticipated net energy metering (NEM) 3.0 proposed decision was released this week and it is very clear that the California Public Utilities Commission (CPUC) has sided with the utilities and is proposing to make drastic cuts to the benefits of going solar.

Over the course of this year, Hammond Climate Solutions has released nine blogs, numerous toolkits with calls to action and participated in countless meetings, presentations and webinars to raise awareness about how the monopoly utilities are trying to kill rooftop solar in California.  We managed to help grow a local coalition consisting of cities, elected officials, environmental and climate justice organizations and schools.  San Diego County residents have made their voices heard, and the message is clear - we want to see solar continue to grow.  The highly-anticipated net energy metering (NEM) 3.0 proposed decision was released this week and it is very clear that the California Public Utilities Commission (CPUC) has sided with the utilities and is proposing to make drastic cuts to the benefits of going solar. 


The first of many changes to the policy, which has allowed rooftop solar to become increasingly accessible to low and moderate-income families, is drastic cuts to the credit that solar customers receive for sharing their excess electricity with their neighbors.  The proposed decision cuts this credit by 80 percent, from around 25 cents per kilowatt hour all the way down to 5 cents per kilowatt hour.  This immediate change alone is enough to see a major reduction in rooftop solar installations and therefore a reduction in solar jobs across the state, however the decision goes further than making cuts to current credits. 


The CPUC has also sided with the investor-owned utilities to slap solar customers with high punitive monthly fees.  The fees themselves will depend on the system size, however an average system in the San Diego Gas & Electric (SDG&E) utility territory will carry the monthly fee of about $64 per month, the highest in the nation.  This fee is in addition to a loan or lease payment, which disproportionately impacts families who utilize solar financing options to afford the switch to solar. 


Beyond the draconian measures the CPUC and investor-owned utilities have taken to discourage new solar customers, they have gone a step further to impose changes on existing customers as well.  The NEM 1.0 and NEM 2.0 agreements that apply to current customers established a 20 year transition period, whereby solar customers were permitted to remain on their applicable NEM tariff for 20 years from the date of interconnection with the grid.  Therefore, solar customers naturally used 20-year financial models to determine the economic benefit of their investment, but the proposed decision is set to negate the bankability of those projections with a 25 percent reduction in grandfathering periods for existing customers. 


As our local and statewide coalition grew, and after delivering 120,000 petition signatures to Governor Newsom, we were hopeful that the CPUC would be on our side and that we would be advocating for small changes in the proposed decision, however it is clear that the CPUC has sided with the monopoly utilities.  As California continues to see the effects of the climate crisis and fires, flooding and blackouts are becoming more and more common, now more than ever is the time to fight back against this utility profit grab! 


Call Governor Newsom today!  Call Governor Newsom directly at (916) 445-2841 or use the Solar Rights Alliance’s calling tool to call.  Press 6 to speak to a representative or press 3 to leave a voicemail.  A sample script is below: 


 “My name is ___ and I live in ____. I am against the proposal to cut the benefits of rooftop solar!  The high solar fees and cutting the benefits of solar by 80% will kill the solar market and worsen the climate crisis.  Nobody should pay a penalty for putting solar panels on their roof and California should be doing more, not less, to promote rooftop solar.  Please say no to the utilities’ profit grab, and yes to helping millions of working and middle class people get solar.“

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Image of packaging littering a beautiful beach

Celebrating the Holidays and Gift Giving Amidst the Climate and Plastic Pollution Crises

Whether you celebrate Hanukkah, Christmas, Kwanzaa, another holiday or none at all, the holiday season brings with it an opportunity to shift societal patterns of overconsumption to sustainable giving. Every year around this time, mass consumption is incentivized more than usual with “holidays” like Black Friday and Cyber Monday. Sales for the holiday season are starting earlier and earlier, and consumers are taking advantage of it. Corporations, which already have far-reaching impacts on the environment, see a dramatic sales increase during this time - Amazon alone has a 260 percent increase in usage on Black Friday each year, translating into not only more stuff in our landfills, but also more money into big businesses and more pollution with the increase in mass production and transportation.

Whether you celebrate Hanukkah, Christmas, Kwanzaa, another holiday or none at all, the holiday season brings with it an opportunity to shift societal patterns of overconsumption to sustainable giving.  Every year around this time, mass consumption is incentivized more than usual with “holidays” like Black Friday and Cyber Monday.  Sales for the holiday season are starting earlier and earlier, and consumers are taking advantage of it.  Corporations, which already have far-reaching impacts on the environment, see a dramatic sales increase during this time - Amazon alone has a 260 percent increase in usage on Black Friday each year, translating into not only more stuff in our landfills, but also more money into big businesses and more pollution with the increase in mass production and transportation.


While U.S. waste statistics are already staggering to begin with, we’re bringing this one back from last year’s holiday blog post as a reminder of just how critical it is to be mindful of waste during the holidays: from Thanksgiving to New Year’s, Americans throw away one million extra tons of trash per week.  If there is anything this year’s U.N. Climate Change Conference taught us, it is that much, much more action is needed - even with COP26 pledges, the world is currently not on track to meet the Paris climate agreement’s goal.  The good news is that each of us always has the ability to make empowering choices, especially around this time.  From shopping local to participating in “Buy Nothing,” we’ve rounded up our recommendations for sustainable holiday celebrations this year, so we can give from a place of protecting future generations and mindfulness.


Food and sustainability this season


The holidays tend to be loaded with meat and if you choose to eat plant-based like many of us, it can be an awkward time.  Family members may judge, let alone simply not understand, and it isn’t fun to be the one going hungry at a gathering.  Cultural foods that are typically made with meat can still be enjoyed, too! Below are some recipes that vegans, vegetarians and meat eaters alike will enjoy, if you have the time and accessibility to create sustainable meals that will satisfy almost everyone at the table:


  • Make it low-waste by opting for the coconut oil over canola oil, and reusing the glass jar
  • Make it low-waste by adapting the recipe to use fresh hominy in bulk
  • Make them low-waste by bringing produce bags to the grocery store and shopping in bulk for quinoa and lentils!


Sustainable gift-giving guide


Selecting gifts is where it gets tough for many, but there are countless ways to reduce your climate and plastic pollution impacts with holiday shopping.  In general, we encourage shopping at local stores owned by folks from communities of concern to reinvest in the communities that are disproportionately experiencing the burden of the climate crisis.  Some of our favorite gift ideas for loved ones include:


  • Give tickets for an event or museum, supporting local artists and organizations (and aim to walk, bike or take public transportation when the time comes)
  • Purchase a visitors pass from your local aquarium or animal sanctuary to support conservation efforts close to home
  • Give a gift certificate to a local zero waste shop or favorite vegan eatery 
  • Our team’s favorite San Diego-based zero waste store is Earthwell Refill (which is Black-owned)
  • Donate to a local climate nonprofit organization on behalf of family and friends to support activists holding corporations and Big Oil accountable
  • Donate to a nonprofit news publication and earmark funds for environmental reporting
  • An example for those local to San Diego like our team, Voice of San Diego is a publication that works hard to highlight local climate issues and the critical movements fighting for climate justice


Traveling for the holidays?


Unlike last year, some of us may be traveling for the holidays this year.  With that, also comes the likelihood of opting for convenience and sometimes, not being mindful of our impact.  Here are some ways you can minimize your carbon and trash footprint if you’re planning on visiting loved ones this season:


  • If traveling to multiple areas, aim for low-carbon transportation when possible
  • Eat at sustainability-focused restaurants within reasonable distance - make it more sustainable by opting for local, organic, plant-based food and drinks
  • Carry reusable utensils with you - if you don’t have a kit, make your own, and wrap up a fork, knife, spoon, and chopsticks if desired into a reusable napkin!
  • Remember to bring a reusable water bottle - many airports have water refill stations alongside drinking fountains
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Photo of Justin and Tara Hammond

Hammond Climate Solutions’ Founders are Recognized for Their Leadership

As full-time climate activists we recognize that our line of work is more like a marathon than a sprint, and know just how important it is to pause and celebrate victories along the way. There have been climate policy wins related to building electrification, transportation and getting cities and big organizations to speak out in support of rooftop solar, which we’ve been proud to be a part of with our amazing coalitions of climate warriors. We have seen climate program wins as well, such as nonprofit organizations reducing local climate injustices through the Solar Moonshot Program and nonprofits helping make electric vehicles affordable to communities of concern. In addition, Hammond Climate Solutions’ founders, Tara and Justin Hammond, have won a handful of recent awards for their dedicated, bold climate leadership and vision to create a more just and equitable future.

As full-time climate activists we recognize that our line of work is more like a marathon than a sprint, and know just how important it is to pause and celebrate victories along the way.  There have been climate policy wins related to building electrification, transportation and getting cities and big organizations to speak out in support of rooftop solar, which we’ve been proud to be a part of with our amazing coalitions of climate warriors.  We have seen climate program wins as well, such as nonprofit organizations reducing local climate injustices through the Solar Moonshot Program and nonprofits helping make electric vehicles affordable to communities of concern.  In addition, Hammond Climate Solutions’ founders, Tara and Justin Hammond, have won a handful of recent awards for their dedicated, bold climate leadership and vision to create a more just and equitable future. 


Most recently, Tara was presented the Environment Champion Award from Business for Good San Diego, a nonprofit organization led by San Diego-based businesses on a mission to engage the local business community on policy issues, strengthening the community’s wellbeing, quality of life and ability to participate in decision-making processes.  Tara has been an active member of the organization since 2020 through collaborating with other local business owners to get involved in local climate policy and facilitating coalition building between the business and climate communities in San Diego.


A month ago, Justin was named an awardee of his local town council's Hometown Heroes awards.  Hometown Heroes were selected for going above and beyond for their community, and Justin was recognized for his long-standing commitment to helping protect the environment locally and beyond. Today, as co-founder and chief energy advisor of Hammond Climate Solutions, Justin utilizes his expertise to perform feasibility studies and design clean energy systems for nonprofit organizations, large and small business, school districts, local municipalities and a variety of other organizations. 


Last month, our team was thrilled to see that San Diego State University (SDSU) Alumni, the alma mater of all of our current team members, named Tara as one of their 10 Rising Aztecs for 2021.  These alumni are under 40 and have been chosen for their extraordinary career achievements, awards and dedication to their alma mater.  Tara, an SDSU Alumni lifetime member, graduated in 2011 with her degree in public relations.  While at SDSU, she held climate leadership roles on campus, including but not limited to being CEO of  the Enviro-Business Society, the chair of the Associated Students’ Green Love/Sustainability Commission, board member of the GreenFest executive team and the Associated Students’ sustainability commissioner.  Since graduating, Tara has encouraged generations of climate activists to grow and thrive through mentoring those that have come after her, equipping them with opportunities in local climate activism and always creating time to connect with those in her community regardless of how packed her schedule is.


Earlier this year, Tara was also named one of San Diego Business Journal’s 40 Next Top Business Leaders Under 40 for 2021. This is the second time Tara has been selected as an awardee for this category by San Diego Business Journal.  Winners were honored for being young change makers, visionaries, leaders and innovators who are making a great impact on their community.  One of the ways Tara continues to make a positive impact on her community is being an active member of various boards, committees and coalitions, including California Solar+Storage Association San Diego chapter, the San Diego Green New Deal Alliance, Surfrider San Diego, Climate Defenders Action Fund, GRID Alternatives San Diego and the San Diego Climate Hub.  For more on what led her to this achievement, Tara’s acceptance video is available to watch here.


Tara was recently nominated to join the Business for Good San Diego board of directors as well as the California Alliance for Community Energy executive committee.  This summer Tara was re-elected vice chair of the San Diego Community Power Community Advisory Committee (Tara was nominated to be chair but respectfully declined and re-nominated the current chair who is a very strong equity champion). 


Our team is grateful for the many partners and clients that have contributed to our collective impact, from individual activists to local climate organizations and coalitions.  We are firm believers in collaborating with others in order to create a more just and equitable future that works for all. 


“Never doubt that a small group of thoughtful, committed citizens can change the world; indeed, it’s the only thing that ever has.” - Margaret Mead. 

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