Friday, November 07, 2014

A Message to California About Collecting Solar System Data

California, you will soon be deciding an interesting debate about who, if anyone, should be collecting data about the state’s distributed generation installations.  Under the California Solar Initiative (CSI), information about all of the systems that took advantage of the CSI incentives has been collected and published on the California Solar Statistics website.  One would think that such transparency that allows an agency and other interested parties to track the success of a program funded with public money would be a no-brainer.  Apparently, it isn’t.

California Public Utilities Commission, you will soon be issuing a final ruling on minimum reporting requirements that, with the phase out of the CSI, would now fall to the utilities.  This was reported recently in Solar Industry Magazine available here.  According to the article, unsurprisingly, certain large developers and the utilities oppose these eminently reasonable reporting requirements citing such specious arguments as the cost of providing this data ($7 to $22 on systems costing tens or hundreds of thousands of dollars).

For years, California and CSI you got this right.  As noted in Solar Industry Magazine The information is supposed to let manufacturers, contractors and investors know which equipment is being installed and where, provide academics and journalists with industry information, and help utilities understand more about their distributed generation fleet.”  This debate brings to mind a similar one that existed in Colorado back in 2006 concerning the collection of information on that state’s solar incentive program.
At that time, a Colorado PUC staffer was assigned to assess a utility application to implement a forward-looking tariff that would fund the nascent solar incentive program under Colorado’s new Renewable Energy Standard (RES).  That new tariff came to be known as the Renewable Energy Standard Adjustment (RESA) and it now collects a bit over $50 million a year in customer money from that one utility and a lesser amount from a second, smaller utility (the fact that the utilities have been allowed to be the administrators of those accounts raises other concerns but that is a different discussion).  At the time, the requested tariff of 1% of customer billings was projected to raise approximately $20 million per year.  The PUC staffer was charged with recommending to the Commission whether the tariff should be allowed to go into effect unopposed or should be suspended and set for hearing.

Ever the dutiful public servant, and having not inconsiderable experience in major industrial project management in the private sector, this staff member requested from the utility a pro forma budget indicating how the funds were to be spent.  He was told there was none.  The rest of the conversation was brief:

PUC Staff: Then why are you asking for $20 million?

Utility: Because we can.

The tariff was suspended and set for hearing initiating Colorado PUC docket 06S-016E.

Through subsequent negotiations, the initial RESA tariff would be set at 0.6% of customer bills on the condition that the utility provide the PUC with a monthly report from its database that included much the same data that CSI has been collecting.  That too took a strange twist.  That conversation went something like this:

PUC Staff: We’re interested in tracking the growth of the program and how the incentives will contribute to the development of the solar industry in Colorado.  So, we would like a monthly report from the solar registration database.

Utility: What database?  We’re not going to have any database.

PUC Staff:  Well, how are customers and installers going to apply for the rebates?

Utility: They’ll submit an application with all of the interconnection data and rebate information on it.  But, there won’t be a database.

PUC Staff:  Really?

Utility: If you want that information, we’ll send you paper copies of all of the applications each month and you can create your own database.

PUC Staff:  Oh, well.  OK.

And so for the next 6 months the utility dutifully submitted seven copies (as required by PUC rules for all paper submittals) of all of the solar rebate applications which an intern working for the staffer gleefully compiled into a database of system level data using Microsoft Excel.  That is, until the utility representative’s successor came back to the PUC staffer and said:

Utility: Look, we’re really tired of copying all of these applications and hauling them over every month.  How about we just send you a copy of the database on CD each month?

PUC Staff:  You mean the database that you don’t have?

Utility: Yeah, that one.

And so, the PUC staffer ultimately used this data to report to the public on the success of the solar rebate program, where the incentive payments were going county by county, how system costs were falling, the level of economic activity generated by the program, and many other statistics that the public and policy makers would (or should) want to know about how hundreds of millions of dollars in support for the renewable program was being spent.

The first publicly issued report of this data showing four years’ worth of data on solar installations in the state was welcomed by many and was especially of interest to the installer community.  Curiously, the report was not welcomed by certain PUC bureaucrats and the utilities who together sought to quash the report because they felt that it reflected negatively on their administration of the solar program. It didn’t but the report did contain some policy recommendations to manage the program more effectively in the public interest.  The agency even went so far as to deny an open records act request by the industry trade association seeking a copy of the report.

Ultimately, the report became the focus of a Whistleblower complaint and was released by a state personnel department administrative law judge who soundly rejected agency and utility arguments for a protective order that would bar disclosure of the information contained in the report.  Sadly, by the time all of this had occurred, much of the information contained in the report had become stale. Today, the arguments in many states are no longer over solar subsidies per se, but whether net metering and distributed generation itself provides a subsidy that disadvantages a utility and the general body of ratepayers.

The end of this story is that docket 06S-016E is still open and utilities still contribute monthly reports of their collections and expenditures of RESA funds. However, neither the utilities nor the agency appear interested in a comprehensive analysis of the systems installed using those funds and the policy implications thereof.  

The moral of this story for you California is that you’ve been doing the right thing in the collection and publication of this system level data all along and should continue to do so to foster transparency in the administration of programs in the public interest.

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