HomeMy WebLinkAboutAgenda Report - February 3, 2016 I-01TM
CITY OF LODI
COUNCIL COMMUNICATION
AGENDA ITEM
I-/
AGENDA TITLE: Provide Direction on the Setting of Rebate Caps for the Annual Lodi Electric Utility
Solar Rebate Program
MEETING DATE: February 3, 2016
PREPARED BY: Business Development Manager
RECOMMENDED ACTION Provide direction on the setting of rebate caps for the annual Lodi
Electric Utility Solar Rebate Program
BACKGROUND INFORMATION:
At a recent Council Shirtsleeve meeting staff was asked to present
information regarding the setting of annual solar rebate caps prior to
release of the Electric Utility's 2016 solar program.
Senate Bill 1 (SB1) was enacted by the State of California in August 2006 to encourage the installation of
high-quality solar photovoltaic (PV) systems. Also known as the "California Solar Initiative" SB1 set a
statewide goal of adding 3,000 MW of new solar PV systems over 10 years and mandated the
establishment of solar PV incentive programs for locally publicly owned utilities (POU's). In the first year,
SB1 required POU's to provide a rebate incentive of no less than $2.80/watt; declining at a rate of 7
percent each year thereafter.
Lodi Electric Utility (LEU) has provided rebate incentives for the installation of solar PV systems since
2008. SB1 is an unfunded state mandate; however, POU's are allowed to collect a separate surcharge to
be used for solar PV system rebate incentives. LEU's Program is funded by the California Solar
Surcharge ("CSS"). The amount collected for CSS is $0.00125 per kilowatt-hour assessed on each
customer's utility bill. LEU's annual solar rebate program budget totals approximately $600,000.
When LEU's solar rebate program began in 2008, the maximum system rebate amount or "cap" was set
at $375,000 and funds were distributed by rate class (i.e. residential; non-residential), on a first-come,
first -serve basis. Over subsequent years, as the cost of solar decreased and interest became more
widespread, the rebate cap has been substantially reduced in an effort to incentivize a greater number of
solar installations. When annual demand for rebate incentives exceeded available program budget, LEU
began using a lottery selection process in an effort to distribute funds in a fair and equitable manner.
Over the last few years, solar rebate incentive caps have been set at $7,000 for residential and $40,000
for non-residential, with no more than 50 percent of total project costs eligible. Even under this approach,
the number of interested customers has exceeded available rebate funds.
Staff compared LEU's program offerings with those of other NCPA member POU's. While a few have met
their net metering obligations under SB1 and are no longer offering solar rebates, current residential
rebate caps range from $2,400 (Roseville) to $18,000 (Biggs); and nonresidential rebate caps range from
$11,850 (Truckee Donner PUD) to $36,000 (Palo Alto).
APPROVED:
Y:11' '
Stephen ScFiwabauer, City Manager
FISCAL IMPACT:
Modification of the annual solar rebate program incentive caps will not
result in a fiscal impact to Lodi Electric Utility; however, such changes could
impact the effectiveness of the solar rebate incentive program.
FUNDING AVAILABLE LEU's Program is funded by the California Solar Surcharge. The amount
collected is $0.00125 per kilowatt-hour assessed on each customer's utility
bill.
Jord n Ayers, Deputy City Manaa er
Adam Brucker
Business Development Manager
$/watt
Residential
$/watt
Commercial
Residential Max
Alameda
Commercial Max
N/A — Program fully subscribed
T
7
Biggs $1.21 $1.21 $18,000
Gridley
$18,000
N/A — Program closed
1
Healdsburg N/A — Program fully subscribed
Lodi
$1.56
$1.56
$7,000
$40,000
Palo Alto N/A $1.20 N/A $36,000 (30kW)
Plumas-Sierra
$1.57
$1.57
$6,000
Redding N/A — Program fully subscribed
Roseville
$0.24
Silicon Valley Power $1.25
Truckee Donner
Ukiah
PG&E
$2.37
$0.24
$0.90
$0.12
$2.37
$0.56 $0.56
$2,400 — 10 kW
$12,000
$2,400 — 10kW
$12,500 - 10kW $18,000 —50kW
$24,000-200kW
$7,110
$11,850
$7,000 $25,000
N/A — Program closed
SMUD N/A N/A $500 per system N/A — Program
fully subscribed