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PG&E Proposal Would Levy New Taxes On Solar Homeowners

The California legislature recently took a step forward in the fight against climate change by voting to boost the state’s renewable energy portfolio standard to 50% by 2030. But before our legislators start congratulating each other for their leadership in advance of the Paris climate negotiations, it’s important to note that the final version of Senate Bill 350 is the end result of a relentless lobbying effort from Big Energy and Big Oil and opens the floodgates to potentially crippling attacks on the rooftop solar industry.

Case in point are anti-solar proposals from PG&E and other investor owned utilities currently pending before the state’s Public Utilities Commission. If these proposals were to move forward, California would go from clean energy leader to a red herring in the fight for our energy future. The only reason they have a chance to succeed is that SB 350 does not include any provisions that directly address rooftop solar.

At this point, you may find yourself pausing and asking aloud: “How can we get to 50% clean energy in 15 years WITHOUT rooftop solar?” Well, the short answer is: We won’t. And without protections in state law, rooftop solar finds itself in a highly vulnerable position.

This week, solar advocacy group The Alliance for Solar Choice filed a tax opinion that the IOU proposals to the PUC would force solar customers to pay new state and federal income taxes on the value of the power they send back to the grid. This would effectively slash the value of rooftop solar systems and cause mass customer confusion. With the state government ostensibly trying to encourage renewable energy, it seems wildly hypocritical to punish consumers for choosing to invest their own money in becoming part of the solution. It’s tantamount to taxing the sun, which I’m not sure the sun would appreciate.

The TASC opinion was drafted by Ed Kleinbard, a law school professor at the University of Southern California’s Gould School of Law. And lest you think I only reference it out of my bias as a USC alum, Mr. Kleinbard’s credentials are strong, having served as Chief of Staff to the US Congress Joint Committee on Taxation, among a litany of impressive roles.

Tax credits and successful government programs like net energy metering have led to a boom in the rooftop solar market because they make the transition more affordable for low- and medium-income consumers. But where there’s a boom, there’s a bust, and the IOUs are on the downside of this equation. That’s why they’re enlisting the best lawyers and lobbyists money can buy and fighting every threat to their status quo.

Nevermind that their efforts could put California behind South Carolina when it comes to clean energy leadership. Nevermind that a majority of Californians – and Americans – consistently support efforts to embrace renewable energy and rooftop solar as a means of curbing pollution and protecting consumers. Nevermind that we’re running out of time before we reach the tipping point in the fight against climate change.

If you’ve got money, you’ve got clout. Meanwhile, the rest of us are left out in the cold.

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