In 2008, Southern California Edison made headlines with an ambitious proposal to build and own 250 MW of solar PV on customer rooftops. The proposal drew both praise and controversy — the praise for thinking big on distributed generation, and controversy because SCE made the case that not only could they do solar more cheaply than anyone else, but that other programs, such as customer-owned solar, should perhaps go away.
Recently, SCE has asked regulators to reduce the size of the program–first, with an application in the spring to reduce the utility-owned portion of the rooftop solar program from 250 MW to 125 MW, and then again on July 28, with an application for further reductions to 91 MW, as follows:
“SCE requests that the Commission permit SCE to reduce the utility-owned generation (“UOG”) portion of the Solar Photovoltaic Program (“SPVP”) from 125 MW to 91 MW, which is based on SCE’s current UOG commitments of approximately 7 MW of Solar Photovoltaic (“SPV”) ground-mount projects that have been energized and 84 MW of SPV rooftop projects that have been energized, are in construction, or are expected to be built….SCE also proposes that the megawatts it does not procure through the UOG portion of the SPVP be added to SCE’s megawatt requirement in the Renewable Auction Mechanism (“RAM”) program…SCE estimates a reduction of 34 MW in the UOG portion of the SPVP would result in SCE’s customers saving approximately $100 million in capital spending…”
For the moment, we’ll set aside the broader implications–if any–for utility owned solar in general.
More importantly, though, this change of course leaves a hole in California wholesale renewable energy markets. This program was one of the few procurement policies that was designed to deliver solar generation close to load. RAM is a great program for delivering low-cost renewables, but RAM projects can be sited anywhere in CAISO service territory. The feed-in tariff program is nearing capacity — has only 100 MW left in unsubscribed contracts, and those are expected to go fast — and is resulting, to date, in projects located in the Central Valley. One of the benefits of utility-owned solar, as described in SCE’s original application, is that the utility can site the generation where they need it the most, and bring it on quickly:
“Because these installations will interconnect at the distribution level, they can be brought on line relatively quickly without the need to plan, permit, and construct the transmission lines….SCE can coordinate the Solar PV Program with customer demand shifting using existing SCE demand reduction programs on the same circuit. This will create more fully utilized distribution circuit assets…SCE is uniquely situated to combine Solar PV Program generation, customer demand programs, and advanced distribution circuit design and operation into one unified system”
With the San Onofre Nuclear Generating Station out of commission, and once-through-cooling plants being shut down, SCE desperately needs local generation. This is one of the few programs that was specifically designed to deliver such.