San Diego Gas & Electric is rolling out “time of use” rates that will eventually affect the monthly bills for about 750,000 of the utility’s residential customers.
But will the switch affect the nearly 155,000 residential customers who have rooftop solar systems on their homes?
Yes, but the full answer is complicated.
The vast majority of solar customers will eventually move to time of use rates but some have the option to stay on a more traditional tiered-rate structure that is considered more financially attractive than time of use — it all depends on how long ago they activated their rooftop solar systems.
“It really varies on the residential side,” said Edward Randolph, the Energy Division Deputy Director for the California Public Utilities Commission, which has directed the state’s investor-owned utilities to adopt time of use rates, also known as TOU. “That’s why (solar customers) need to contact their utility to find out their exact circumstance.”
And circumstances have been changing quickly, in California’s energy landscape.
Many customers — those with solar installations as well as those without — had just gotten used to the latest iteration of tiered rates and adopting TOU means a transition to a different pricing plan.
For solar customers in the SDG&E service territory, the 20-year rule applies to those who activated their systems before June 29, 2016.
Randolph said the commission instituted the 20-year rule as an issue of fairness to solar customers who invested in a solar installation on their homes — a purchase that can frequently run to $20,000 or more, depending on the size of the house.
“When they installed the panels, they were looking at the financing and the payback of those panels based on the rate structure at the time,” Randolph said. “Ultimately, the commission made the policy determination that the most equitable way to treat those customers was to give them the option of staying on the old rate structure.”
After the 20 years are up, customers must move to time of use rates.
“If you’re a customer who installed solar a few years ago, you’re probably going to want to stay on those tiered rates and not get shifted over to TOU,” Heavner said.
But what if you installed solar on your home after June 29, 2016?
Here’s another part of the story that’s complicated.
Customers who activated their rooftop solar systems between June 29, 2016 and March 30, 2018 were defaulted to standard, tiered rates rather than TOU.
They can stay on tiered rates for now but eventually, they will migrate to time of use — either five years from the date their system activated or June 2021, whichever comes first.
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