California Solar Energy Overhaul and Why Switching to Solar Makes Sense

For many home owners in California, the increasing cost of energy has become a major concern. The results of the economic glut are still being felt in many California homes, and as a result, homeowners are beginning to consider cheaper, affordable and cost effective solar energy. With the rising cost of living and mortgage rates, many homeowners have begun to shun traditional energy utilities for cheaper and friendlier solar energy.

California recently approved AB 327 which is meant to introduce radical changes in the energy sector particularly when it comes to reviewing current electricity rates. The bill will attempt to address the “affordability crisis” that some homeowners face. These efforts come at a time when California home owners and businesses have already begun making substantial investments in solar energy.

Basically, AB-327 is a rate reform bill that addresses inequities with electricity rates. In a message from Governor Jerry Brown [1] concerning AB-327 he explained that it is meant to “protect low income energy users and maintain incentives for renewable energy investments”.

In the solar industry, the biggest question surrounding this legislation is simple: how will these changes affect homeowner’s interest in switching to solar energy? How does AB 3327 help or hurt the likelihood that homeowners will install solar panels?

The California solar energy sector has undergone many reforms in the past few years and is considered a model for other states (go Cali!). Each year, there has been a marked improvement and an increase in solar panels being used across California homes. Recent statistics have indicated that it is widely expected that the demand for solar energy panels in CA will increase by 56% in 2013. Despite concerted government efforts to convince CA home owners to continue using traditional electrical energy, solar energy seems to have captured the attention of home owners.

California solar energy is efficient, safe and friendly to the environment. Environmentalists have also pointed out that the use of solar should be enhanced for the sake of the environment. Recent statistics have shown that companies such as KB Home have decided to build several communities in California with the inclusion of solar panels as a basic amenity.

According to Tom Werner who is the CEO of SunPower California, a 3 Kilowatt solar panel has the capability to comfortably power a medium sized home for less than $15,000 one time investment cost. This is an attractive investment for home owners who are looking to reduce the cost of energy.  The best approach to benefit solar energy is to incorporate the cost of developing solar energy systems into houses during the construction phase.

Utility companies such as Edison International are under threat as their services could soon be overtaken by California solar energy. In the beginning, it seemed like those utility companies would be able to hold their monopoly over CA homeowners and penalize rooftop solar users.

Initially, the AB-327 legislation was looked down upon because it was going to give utilities the right to charge a flat rate to solar customers and to spread out the general cost of rates. Thus, utilities could ease the hit they were taking from rooftop solar customers. However, recent revisions to the bill have lead to a much friendlier package for solar customers and providers. The most important outcome of the new legislation is that it doesn’t complete discourage energy conservation by allowing huge fixed charges and fees for rooftop solar homeowners.

It makes perfect sense to go solar in California because even if Utilities are allowed to charge a flat, monthly rate to their rooftop solar homeowners (say, $10 per month), that will still be far less than the cost of standard electricity bills.

There are many benefits of using solar panels and CA home owners know this too well. It is for this reason that many home owners are beginning to focus on alternative energy sources in a bid to cut down the cost of energy. Despite the authorities’ efforts to streamline the traditional energy sector, it is expected that CA solar energy will continue to gain market dominance as the government continues to pass legislation that encourages energy conversation. Viva La Solar!

References: [1] CA Gov
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California Solar Energy Overhaul and Why Switching to Solar Makes Sense by

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