CPUC Reinstates Solar Incentives for Local Governments

In a swift reversal, the California Public Utilities Commission last week reinstated solar incentives for public water agencies and other local governments through the California Solar Initiative.

The move, coming less than 30 days after the commission issued a temporary hold on processing applications for incentives, means that ACWA members can once again pursue solar projects with the incentives intact.

In an order filed July 29, Commissioner Michael Peevey said numerous parties had submitted comments saying the hold would disrupt the development of the state’s solar market. Peevey agreed the hold would create “an unacceptable level of market disruption” and ordered program administrators to resume processing applications and issuing reservations for solar incentives.

The order reinstituting the incentives can be found here.

In early July, the commission proposed a temporary hold on the incentives pending consideration of measures to address a potential influx in applications that could exacerbate a projected budget shortfall for the program.

The commission will continue to consider three proposed modifications to the program, including 1) removal of the 8% discount rate embedded in the calculation of performance based incentive (PBI) payments; 2) reduction in the incentive rate offered for government and non-profit applicants; and 3) shifting of $20 million from the program administration budget to the incentive budget.

If the commission adopts any of the proposed incentive modifications, the changes would be applicable to new applications seeking incentives after the date of any such decision.