Solana Beach to discuss proposed SDG&E rate increase

By Claire Harlin

The Solana Beach City Council on Nov. 9 will discuss and possibly take position on a proposed utility rate change that could effect all consumers of energy — especially solar energy — in the region.

San Diego Gas & Electric (SDG&E) filed the second phase of its General Rate Case (GRC) with the California Public Utilities Commission (CPUC) on Oct. 3 asking for approval to change certain rates. According to the California Center for Sustainable Energy (CCSE), a nonprofit energy innovation organization that has quantified the proposed changes, SDG&E’s proposal would increase residential solar customers’ rates by $10 to $40 per month.

“This is the first service territory to my knowledge that’s tried to do something like this,” said Chuck Colgin, a CCSE public relations representative. “Frankly, utility rates are complicated and we just want to help people in the community understand what this could mean for the solar industry. It’s possible other utility companies could use this as a model.”

CCSE also looked into commercial entities, and determined that the more they save by using solar the more they will pay with the proposed increase. CCSE modeled a local water district that is offsetting its electric bill by 90 percent, and determined it would see an annual increase of about $70,000.

A decision on this matter is not expected until August 2012, and changes would begin in January 2013. Most non-solar residential customers would see an increase of no more than $1 a month, according to SDG&E. SDG&E did not returned repeated phone calls, but according to an SDG&E memo, the rate change would not increase revenue; it involves a new rate design that would change how costs are allocated among customers. These “cost-based” rates, as the company calls them, mean “all customers pay the actual costs of serving them.” The SDG&E website states that these rates are “meant to protect customers from paying more than their fair share or subsidizing the costs it takes SDG&E to serve other customers with utility service.”

Solana Beach Mayor Lesa Heebner said bringing this issue before the council is not only a measure to protect Solana Beach residents who have invested in solar panels, but to stay in tune with the city’s “strong belief in sustainability.”

“The best way to go is for all of us is to have solar on the roof,” said Heebner. “But this puts a couple ounces of gold on the side of ‘Let’s not do it.’”

Heebner said city officials want to reduce fees and encourage solar on rooftops, and she’s afraid a rate hike may be a discouragement for potential solar users.

“It’s also like switching the rules in the middle of the game for those who already have solar,” Heebner said.

Colgin said the monthly increases for solar customers “may not seem like much, but it could reduce the value proposition for future solar buyers.”

“It makes it hard for potential solar cutomers to see return in investment,” he said. “It could hurt the solar marketplace as a whole.”

Solar Now/EGP Building Services, a local company that designs and installs solar panels, has taken a stand against the GRC. The company’s owner, Jose Gomez, wrote a letter to elected officials encouraging them to contact the CPUC and oppose the measure.

“It has come to our attention that SDG&E is stating that the solar industry supports their rate case,” Gomez wrote. “This letter seeks to set the record straight.”

Gomez also expressed concern that the rate proposal could set a precedent if it is approved, and that such a measure would be a step backward for sustainability.

Referring to the impact on customers, he said the rate increase would be “fiscally irresponsible and will certainly escalate the costs for states and municipalities already managing severe budget deficits.”