California Senate Passes Community Solar Bill, Expected to Add 5.4GW

en.Wedoany.com Reported - On August 30, the California State Senate passed AB 1813, the Community Renewable Energy Program Act, with a vote of 30 in favor and 10 against. The bill had previously passed the State Assembly on May 22, and the Senate amended the text on August 27, so it still requires the Assembly's concurrence on the Senate amendments before it can be submitted to the Governor for consideration.

AB 1813 proposes to adjust California's existing customer renewable energy subscription program. Under the amended text of August 27, individual generating facilities of community renewable energy projects included in the program must not exceed 5MW in capacity, with associated energy storage power not exceeding 5MW; projects must be equipped with energy storage systems with a capacity equal to the renewable energy facility's output and a duration of at least 4 hours. The total capacity cap for new projects under the program is 4GW, or 7 years from the opening of project registration, whichever comes first, after which no new community renewable energy projects will be accepted.

The bill requires that at least 51% of program capacity serve low-income customers, and allows residents to receive corresponding electricity bill credits by subscribing to community renewable energy projects. For community renewable energy facilities designated as load-modifying resources, customer bill credits will be determined based on the avoided costs of distributed energy resources; regulators may use actual wholesale market electricity prices in calculating the value of the energy supply portion within the avoided cost calculation.

Project siting must also be within the same local reliability area as subscribing customers. The bill requires project developers to comply with prevailing local wage standards and stipulates that project development conditions should balance the development and financing feasibility of community renewable energy facilities. After project operation, operational information such as hourly generation, energy storage charge/discharge data, participating customers' hourly electricity usage, and generation capacity of each component must be recorded.

The California Public Utilities Commission completed the implementation rules for the current Community Renewable Energy program in June of this year. The existing mechanism determines project compensation under the Renewable Market Adjusting Tariff pricing framework and requires that costs borne by non-participating customers not exceed the avoided wholesale electricity costs generated by the projects. AB 1813 seeks to further change the value accounting and subscription credit mechanisms for community solar and storage projects.

Under the bill's provisions, the California Energy Commission will evaluate, through a public process, the capability of community renewable energy facilities to serve as load-modifying resources; if the evaluation confirms such capability, the Commission must determine the specific attributes projects must meet by December 1, 2027. Thereafter, the California Public Utilities Commission must adopt or modify the customer renewable energy subscription program within 180 days and establish a corresponding load-modifying resource recognition mechanism.

The bill also requires that within 24 months after the adoption or modification of the new community renewable energy subscription program, regulators submit the first implementation report to the State Legislature, followed by annual reports on participating projects, subscribing customers, and low-income customer participation, with reporting requirements continuing until January 1, 2034.