Adding an energy storage system to a NEM-eligible solar system or generator in California just became a little easier and more transparent under a new Public Utility Commission ruling.

Last month, Jeff St. John reported on the schism between utilities and the solar industry when it comes to how best to integrate energy storage. California’s big three investor-owned utilities -- Southern California Edison, Pacific Gas & Electric and San Diego Gas & Electric -- have been demanding that energy storage systems undergo reviews costing between $1,400 and $3,700 in extra fees. Utilities claimed the review was needed for safety reasons, as well as to make sure that consumers don't game the system; storing grid power and then feeding it back under the guise of green, net-metered power.

In a recent public address, SolarCity CEO Lyndon Rive insisted, "There is no extra complexity in interconnecting" a PV system with storage versus just a PV system. At another recent forum, Rive noted that customer interconnect for SolarCity's energy storage system was taking an average of eight months.

CPUC President Mike Peevey publicly said that changes were afoot to remove these obstacles.

Jigar Shah commented on the recent Rive-Musk-Peevey discussion, "This was fantastic theater to force Chairman Peavey to finally rule against his friends at the utility companies. This is the beginning of the end for the utilities." (Shah might be engaging in a bit of hyperbole.)

In any case, last month, California's utility regulators issued a proposed decision that was a rebuke to utilities and a boon for hundreds of stalled battery-backed solar PV projects in California. Storage and solar advocates had been anticipating a ruling that supports a more streamlined, no-cost solution. 

And as of last week, the final ruling is in (here's a link to the full document [PDF]). The decision doesn’t give the distributed generation industry all it wants -- but it removes some significant obstacles.

Here are the basic provisions:

  • Systems larger than 10 kilowatts will require a separate meter for measuring the interplay of battery-charging and solar generation at a cost capped at $600. (The cap doesn't apply to projects requiring complex metering solutions.)
  • Systems smaller than 10 kilowatts will use an estimation for NEM derating
  • The decision directs that exemption from standby charges, interconnection application and review fees for NEM-paired storage would be tested on a provisional basis for systems connecting by December 31, 2015
  • NEM-paired storage systems with storage devices larger than 10 kilowatts shall have a maximum output power no larger than 150 percent of the NEM generator's maximum output capacity

“We’re very encouraged by the proposed decision having no application fees, and having the costs of the meters capped,” said Peter Rive, SolarCity's COO, in an interview. Given that SolarCity already monitors each individual installation at the meter and at the inverter, “I don’t think a meter is necessary at all -- but we’re moving things forward,” he said.

As for the finality of this ruling, Will Craven, Sr. Public Affairs Manager at SolarCity, commented, "Procedurally, parties can offer comment on the decision that could then potentially re-open proceedings, but for all intents and purposes, this is it."

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To learn more about regulatory changes happening across the country in response to distributed energy resources, join Greentech Media at Grid Edge Live in San Diego June 24-25.