SB 594, a law that went into effect in PG&E utility territory February 2014, now allows property owners to aggregate the electricity load of multiple utility meters scattered throughout a single parcel or multiple continuous parcels and credit the bills with a single “Net Metered” installation.
This new program is called ‘Net Meter Aggregation’ and reduces the cost of solar installation and increases flexibility for farmers that may alter individual electric meter consumption from year to year. This removes financial and technical barriers to going solar for farmers that have multiple utility meters on a single property or meters scattered throughout many parcels and were unable to take full advantage of California’s net metering program.
The Old Net Metering Rules
Similar to rollover minutes on a cell phone, net metering allows a solar customers electric bill to be credited for any extra power produced by the solar array.
Before Meter Aggregation, however, regulations limited the net metering incentive to the meter that was directly connected to the solar installation. For homes and small businesses, that structure worked fine, but farms often have multiple meters and usage on those meters can change from year to year based on growing crops on a particular parcel or not. This program now eliminates the cost that was previously required to connect all those meters to a solar system or the bill credits wasted if a water pump is not run for a year while solar is generating.
In the case of agricultural land, a single meter is often installed for each water pump across multiple acres of farmland. For factories, industrial facilities, and large government compounds such as an army base, a utility meter is often installed for each building on the compound.
Under the old rules, only a single meter connected to the solar installation could receive net metering credits. So, even if the solar installation could power all of the water pumps, the landowner would only receive credit for the single water pump tied directly to its meter and the nearby solar installation.
The New Net Metering Aggregation Rules Under SB 594
Under the new rules, multiple electrical accounts can now aggregate the electrical load of all the meters on the property where the solar system is located, or on property that is contiguous to the solar system.
Instead of building multiple solar systems for multiple meters on a large farm, solar companies can install a single solar PV system in one area. From this single location, the solar power generated—and any net metering credits produced—will offset the electricity used by all of the farm’s various loads, such as water pumps, electric fences, cold storage facilities, etc.
Take for example Bowles Farming Company, Dos Palos, California. This California farm had over 20 meters scattered throughout hundreds of acres. Under the old net metering system, a solar system would have to be built for each of those meters and would not be feasible. Under the new aggregate net metering law, REC Solar will build a ~800 KW solar array to offset 100% of their expected kWh consumption throughout all meters.
The new aggregate net metering rules decrease commercial solar installation costs for several reasons:
- A single large solar installation requires less equipment, labor, and time to build than multiple smaller installations producing the same amount of energy.
- A single solar array can now be installed in the most ideal location on California farms, potentially producing more power than multiple installations tied to individual meters that have less than optimal sunlight.
- Extra equipment and engineering won’t be necessary to accommodate bad terrain or interconnection issues.
- It’s now cost effective to build a larger solar array that offsets more utility power.
- Similar to changing your allocation within an investment portfolio, Solar generation credits are allocated to meters and customers can easily change allocation percentages as usage patterns become different.
Similar to the farm’s meter issues, an industrial facility can now install solar on an adjacent empty plot of land or rooftop and be able to offset the power of all the property’s buildings.
SB 594 Meter Aggregation Limitations
While Meter Aggregation frees net metering’s restrictions, the CPUC did impose some limitations.
- The maximum size of the solar system is 1 MW. So, if a farm needs to build a larger system, then an alternative program for larger systems will apply .
- Net metering is only applied to the maximum load (i.e., energy use) of all of the meters on site. So, if the solar system over produces and generates 110% of the farm’s energy needs, the extra net metering credits will not be as valuable. . Consequently, it’s important for a solar installer to design a system that is optimal and understand every aspect of the project.
- This program is only available for a limited time and will end once the current Net Metering program expires.
This last caveat is important. Currently, customers benefit from being credited at the full retail rate for their solar net metering credits. However, with the passage of a similar piece of legislation, California’s AB 327; the CPUC is now in a process of redefining the value of net metering, effective Summer 2017 – or until 5% of the utility’s customers have Net Metering.
It is unknown whether the new net metering program will reduce its value to customers, but many insiders suspect it will. In order to take advantage of this opportunity before it expires, customers must have a system installed before the new program takes effect. Once your system is installed, you will be grandfathered under the current net metering rules for the next 20 years!