SolarCity: Interconnection charges for PV storage may be ‘illegal’

  • DemandLogic.
    SolarCity's commercial storage system DemandLogic. SolarCity's senior director of grid systems integration and storage, Eric Carlson, recently described storage as “a required and obvious solution at very high levels of penetration”. Image: SolarCity.

Fees being charged to interconnect residential storage systems to the grid in California are “arbitrary” and “punitive”, while some may even be illegal, according to US installer SolarCity.

SolarCity has stopped submitting applications to deploy residential storage systems in the California territories served by the utilities Southern California Edison, Pacific Gas & Electric and San Diego Gas & Electric.

The company has accused the three utilities of illegally charging to connect PV systems with storage that should be free under state net metering law.

An article carried by Bloomberg earlier this week implied that SolarCity had “suspended” the programme, which SolarCity director of communications Will Craven described as a misinterpretation of the situation.

“The headline suggested that we had proactively halted or frozen the programme, which is not the case. There were items in the queue for each of these territories and in Southern California Edison and San Diego Gas & Electric, the queue is not moving. We are waiting for the utility to fulfil its role in this process and until the queue starts to move a little, we’re not adding to that queue.

“I think it’s inaccurate to say we have taken our ball and gone home – that’s not what’s happening. It’s more the case that utilities seem to be engaged in some level of obstructionism and in each territory it’s a somewhat different level of obstructionism,” Craven said.

Craven told PV Tech that, among other things, the company believed an US$800 application fee levied by the three major California utilities is illegal under state net metering statutes.

“We believe this [application fee] is illegal under California net metering statutes. The California energy commission ruled that when battery storage when paired with solar is an ‘addition and/or an enhancement to solar’ and therefore falls under all prevailing net metering statutes and one of those statutes is that there may be no application fee charged.”

Craven also referred to meter fees being charged by utilities that ranged from US$600 a meter in Pacific Gas & Electric and San Diego Gas & Electric territory to as much as US$2,900 per residential meter in Southern California Edison territory. Craven described these costs as excessive and said SolarCity estimated the meters to be costing the utilities just a small fraction of the amounts being charged.

Craven also said interconnection times appear to be ranging from “29 weeks to infinity”, with the best case scenario in PG&E territory, where 11 customers have been interconnected to date, followed by SDG&E with just one and SCE lagging far behind with no interconnections to date out of 140 applications submitted since 2011.

Craven said that some of the things holding up the queue fell into a few different categories.

“One of them is the application fee. We are being charged US$800 per application in each utility territory. We believe this is illegal under California net metering statutes. The California energy commission ruled that when battery storage when paired with solar is an ‘addition and/or an enhancement to solar’ and therefore falls under all prevailing net metering statutes and one of those statutes is that there may be no application fee charged.”

Craven said that nonetheless, the company wanted to have a “good faith partnership with utilities”. He expressed frustration that the shared aims of deploying storage on to the grid in California, as mandated by the California Public Utilities’ Commission are being prevented from being fulfilled. The State of California’s utilities must put 1.325GW of storage onto the grid by 2020, 200MW of it behind the meter.

“We would like to deploy storage – this pilot project is going to help everyone understand the impact of residential battery storage on the grid. We really hope for a productive collaboration with utilities on how exactly how storage figures into the grid of the future. We would like them to help us deploy the storage that’s been mandated,” said Craven.

“This is one of the most anticipated new products in the energy space. The public is vey excited about it…but at this point we’ve lost faith that these interconnections will be carried out in a reasonable manner.”

PV Tech also approached Ray Boggs of Solar Homes, an independent installer in California for comment on the subject.

Boggs said some utilities had been "interfering" with the interconnection process, in his opinion. According to Boggs his company had been selling storage systems in the USA since 1997 and said that around eight months ago SCE began rejecting interconnection agreements stating that they had no way of knowing that “the energy that was stored in the batteries was truly from a renewable source or came from a non-renewable source such as grid itself.”

“Despite the fact that many homeowners had purchased and installed their systems with the proper permitting and the California Energy Commission’s approval, Southern California Edison began rejecting their applications, and to this date has not granted these customers authorization to activate their systems,” Boggs said.

The Edison Electric Instute, which represents US investor-owned utility bodies, did not respond to PV Tech’s request for a comment.

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