Community Solar in California and Beyond with Kelly Roache of Renewable Properties EP 132

I think a huge make or break element of policy designed for all of these different authorities to be considering is, even if the economics and the bill credit rate the sort of value or which solar and community solar specifically is compensated. So I mentioned the theatre value of distributed energy resources. In New York, there is also a VUS, or boss value solar tariff in Minnesota, which is has been pretty successful. So So getting that right. And really incorporating all value that solar brings to the grid is essential to quantifying that and quantifying environmental values accurately and fully.

Today on the Clean Power Hour community solar in California and beyond. I'm Tim Montague, your host Welcome to the Clean Power Hour, check out all of our content at CleanPowerhour.com. Please give us a rating and a review on Apple and Spotify that helps others find this content. My guest today is Kelly Roache, she is the Director of Policy and community solar for Renewable Properties. Welcome to the show, Kelly, thank you for having me, Tim, really excited to learn more about renewable properties. You guys are a, you know, a well established solar company in some markets, not a household name here in the Midwest, but I look forward to learning more about what you're up to, and especially geeking out on what's going on in the California community solar market, because it is, as I like to say very ironic that we don't have a great community solar market in California yet. Maybe that's coming to us soon, hopefully. And, you know, when I when I think and write about community solar, I think of Colorado, I think of a New York, Illinois, Minnesota, but not California. Why is that? And what are you up to renewable properties?

It's a great question, I guess I'll just start with a very brief intervention on renewable properties. So we do have some work in the Midwest, and I'm hoping will become more of a household name there and time, but our solar developer, working on kind of community solar to sort of small utility scale solar development, so about the one to 20 megawatt range, on paper, but really specialising in that one to 10 megawatt range. And we are active in New York, Maine, all over sort of east coast, and hopefully New Jersey as their their programme comes to bear, certainly California is home base, have a lot of experience and assets there. And then some of those other markets you mentioned as well as Minnesota. And I think increasingly Illinois, as as that market takes off.

And before we before we geek out on the California market, tell our listeners a little more about your background, you you have an extensive background in in clean energy, but how did you come to clean energy to begin with?

Yeah, I kind of came through it through the lens of policy. So my academic background, and originally my work background was in foreign policy, studied and worked throughout Middle East and South Asia, increasingly became really seized by many of the issues domestically as well that were facing us and particularly the very existential threat posed by climate change and the ecological crisis. And so started kind of working in policy and in the solar field, and specifically community solar, I guess that was 2016. So about seven years ago now, and I've been in one way or another kind of working in the renewables space ever since through social enterprise or nonprofit investigative research. And now back solar industry side.

I love community solar, because it truly is the democratisation of solar, right. You don't have to own a rooftop. You don't have to have a shady roof, you don't want to have you don't have to instal equipment on your on your building, right? You build a central facility, hopefully near a community or near a population. But these these community solar projects are spread all over the states where there's good legislation, it is, you know, only happening in certain states. I mean, technically there are 20 Plus states now that have good community solar legislation or legislation, but there's really only a handful of very active markets, and then a shortlist of burgeoning markets. There's some new new entrants like New Mexico has, has a pilot programme. You know, here in Illinois, we got a market in 2017 really took off in 2019 As far as construction goes, and then it and it busted as soon as it boomed really. Now we have new legislate ation which is feeling a second wave and, and so it is it is a spotty market but a great market as far as I'm concerned because it's it's truly distributed across the landscape these are these are five to 50 acre solar farms, that then any any resident in a particular jurisdiction like in Illinois, we go by IOU territories investor owned utility. So if you're an Amerind territory, you can subscribe to any community solar project in Amarin. If you're Northern Illinois, the same for comment, Commonwealth Edison than major IOU in Northern Illinois. So, yeah, tell us a little more about what you're charged with at renewable properties. And, and and then let's let's talk about California, because it is it is a very strange market. With regards to community solar.

Yes, it is, I failed to mention New Mexico, my rundown of states where we have made a lot of strides. So thank you for putting that on the table as well. And yeah, my charge is, is on the on the policy front, very much the top of the funnel development process in helping to monitor and setting since shape new markets for development for community solar for ourselves and others in the development community. Understanding where to strike next. And then throughout the entire development lifecycle, of course, supporting all the regulatory questions and compliance and strategy around incentives, things like that. And then on the community solar side, I also work on a little bit later in the development process to help us either acquire customers or build relationships with other organisations that acquire customers for those community solar projects.

Excellent. So California, it is the oldest most mature market for solar in the US. There's a lot of reasons for this. One is it is the tech hub of the United States, solar is technology, even though solar was invented in New Jersey, in 1954, at Bell Labs, and energy is expensive on the West Coast, and that's a good combination. So, so anyway, you know, solar really took off in in 2010. Of course, it was happening before that, and but it was very expensive. And so just not really in the in the mainstream. Now. It's truly gone. Mainstream. You can you can instal solar almost anywhere in the United States. It's just a question of, what are the economics? How quick is the payback? And can you save money by installing solar. And that's true now in many markets, which is wonderful. And globally, just if you don't know this, if you're listening, and you don't know this solar, and wind are the fastest growing sources of new energy on the grid, globally, solar being number one, and then wind number two. So solar is truly coming on to the scene as as a mature technology and eclipsing the fossil fuels very quickly. And in markets that are more mature than the US like, like the EU, like, like Europe, solar and wind now exceed fossil fuel generation. So it's just a matter of time, before. You know, in the US, we go to a 80% wind and solar grid, we're at about maybe five or 6%. Solar today in the US, and we're gonna go to 50% by 2050. So we're going to see a 10x increase in solar, so huge growth opportunity, which means a great opportunity for landowners for residents. And of course, for people who work in the clean economy. But let's talk about California. What's the story?

Yeah, it is fascinating. So solar, of course, as you mentioned, is a lot of sunshine and a lot of solar track record and installations in California, as the state leader in the US, but it has the market has struggled around community solar. So there was a set of programmes that came to fruition as a result of Legislation in California, round 2013. The one I'll really focus on is sort of called enhanced community renewables or ECR I think that's kind of the best. There are many there are many flavours of community solar, but maybe the best proxy for the the type of community solar paradigm that we think about in other states, where you have a solar farm or solar garden that's owned by a third party, and you're having subscribers who participate and receive financial benefit from from those projects. You know, there are there a number of challenges but one is certainly around the bill credit. I think that's something you said, Tim that's really important is that subscribers and, and Energy customers need to save money to participate in these programmes. And when energy prices in particular you've seen have been, have been high, it's hard for people to envision paying more for clean energy, even if they're really committed to supporting and participating in clean energy programmes. So so that was that was a failure with sort of the green tariff community solar programmes in California to date, the ECR programme, the issue is that the kind of bill credit that forms the basis of the economics of these projects was set very low during implementation by the California Public Utilities Commission. And as a result, it has been very difficult to kind of make the economics of those projects pencil while still providing a savings to customers, which is which is critical. So for tough for both developers and for and for customers to benefit in that market. And through that programme with the bill credits that can run a wholesale price rather than, you know, robust retail price or something closer to that, that we see in a lot of markets, or community solar has been successful and has flourished. So that is one issue. There are kind of other charges related to that. In California, there's kind of a charge for departing load from the investor on utilities called the power charge and difference adjustment PCIA which, which has, you know, been a struggle for for some of these California Community Solar programmes. But now we have kind of another shot to get it right with the more recent legislation where the bill credit will again will have an opportunity to come before the California Public Utilities Commission, and to write that, among some of the other issues, I guess, just pretty stunning. statistic for you around ECR that enhance community renewables programme is known to date and kind of the whole universe of community solar programmes that were authorised in California. The the amount contemplated was up to 600 megawatts, and that includes a couple of different programmes, but UCR as well. And to date as of the most recent quarterly filing from the utilities in California. There were zero megawatts that were successfully developed through that programme. There are a few that had been procured, I think around 3040 megawatts that had been procured and may potentially still come to fruition. But that's a pretty, I think, stunning indictment of the success of those programmes to date.

I can't claim to really understand all of that, but but but let's talk about the future. You know, your your CEO Aaron halimi, just recently penned an article in Seoul in renewable energy world. So check that out. It's called How To Design A successful community solar programme in California. It References a b 2316. A new community solar plus storage law that sets the stage for creating a viable community solar programme for all Californians. So the problem is getting fixed. What's the story with a B? 23 2316?

Yeah, tremendously exciting development, one of the most exciting opportunities in the California Solar landscape and certainly community solar and a decade. So now the legislature has done their job and passing the bill with the bill states is that now the California Public Utilities Commission is going to evaluate the existing community solar programmes, sort of green, green access programmes ECR and this green tariff, fair to renewables programme, determine how effective those have been. And then they have the authority to then propose, either make changes to those are proposed kind of an entirely new community solar programme. So that process has kicked off and proposals have started coming in from all different stakeholders in this process from the industry, from utilities from consumer advocates and Ratepayer Advocates, environmental groups. So that is all being laid on the table. Now, and procedural schedule is such that we're hoping by looks like the third quarter of this year, there could be a proposed decision from the California Public Utilities Commission CPUC. And legislatively, they have to either have something in place if they plan to or complete their evaluation of these existing programmes by sort of mid 2024. So we're hoping to see something even sooner based on that procedural schedule, but then the commissioners will vote on that decision and you certainly want them to take all the time needed to form a well thought out and and really workable programme, but this is kind of an opportunity to start fresh in some ways with the elements of the programme design that have had failed in the past.

Cool, I see that there are specific call outs in the legislation for low and moderate income populations and energy storage. Do you want to comment about those types of call outs or carve outs and the importance of those?

I do. I think it's, it's great. And we're really excited to see both of those things. So one in terms of you think about how Fornia and the amount of solar that's deployed how really important hertz storage is going to be particular, you know, trying to shift that curve. Already, there are proposals to, you know, incentivize more richly kilowatt hours during to more to align with peak usage in California, which is I think, now between four, five and 9pm. So storage is really integral to that. And we're happy to see storage specifically named in the legislation as kind of a tool to pair with community solar. And as with regard to, you know, the focus on low to moderate income populations, you think that's really essential. The bill states that at least 51% of the programme will need to serve low to moderate income people, which is, is great. And that may be on a project basis, that may be on a programme basis. That's something that's still being worked out at the Commission through the implementation process currently underway. But California has a lot of, of renters, who are disproportionately low to moderate income population, and who are definitely a population that ISIS a renter myself, who can benefit heavily from community solar not being able to otherwise instal renewable energy. And and just from an equity point of view and justice point of view, I think it's really important that people who have been, you know, most impacted often by climate change, and who are living closest to impacted communities have the opportunity to financially benefit and to participate in the clean energy economy. So that's all great news. And it certainly aligns with some of the federal initiatives we've seen in tandem, as well around the inflation Reduction Act and some of the goals and incentives around working with and serving low to moderate income customers and communities with with community solar and other renewables.

Indeed, indeed, it's so it's so vital that solar is accessible to all groups, especially those who are most impacted by climate change, which certainly will be low and moderate income people everywhere. It's only fair that we, that we give everybody a a fair shot at the clean energy transition. So this is this is vital. With regards to storage. You know, every state goes about this differently. But you do see carve outs for incentivizing storage. In Illinois, we don't have storage necessarily attached to community solar, not legislatively, we do have a very generous storage incentive now $250 per kWh. What can you say about the importance of storage? And what are the trends, I guess, that you see, when it comes to attaching storage? To community solar in particular?

Yeah, and that and Illinois, I know that functions as a rebate is kind of a structure, or are these storage incentive, though? I also know there may be a further proposals and legislation coming down the pike that would would expand that or to community solar as well. So well, we'll have to see how that plays out in Illinois, this session, I think, trends wise, but what you typically see is that it's really the more mature solar and community solar markets, that are really being very intentional about building in a storage component and into the at the programmatic level. New York just released a storage roadmap, the very end of last year, and that is something that's now an active proceeding before the Public Service Commission in New York and will hopefully be we'll see an order from them hopefully by mid year, that will authorise some some incentives specifically for storage that can also be coupled with community solar, which is which is a great strategy in particular as the kind of way incentives for community solar are structured in New York as their declining block incentive that has stepped down over time. So as that step down, continues, thinking about storage as kind of a way to revitalise and at or continue robust development in that state, I think is is really promising. And in California, you know, again, they're just kind of starting from, in some ways, you know, not not a lot of successful community solar development, but just to a very high penetration solar market compared to a lot of other states. So I think it's really essential. And hope more States will continue to take it under consideration, not just kind of as a phase two or phase three, but really building that in from from the start.

Hey, everybody, thanks for listening to the Clean Power Hour or viewing it on YouTube, we do have a great YouTube channel, if you're not subscribed, please go to clean power dot group, and hit that YouTube icon and subscribe to our channel. Of course, you can find all of our content on your favourite audio platform as well. So please give us a rating and review back to the show. Yeah, you know, I like to encourage my colleagues in the solar industry to become storage experts if they're not already, because solar and storage are a very good pairing, as well with wind, right, because these are intermittent resources, solar and wind, and then you can store the extra energy and there is lots of extra energy coming from the sun, plenty of energy to capture in a battery and then use that as a as a value stack as a sponge, if you will, it can receive energy, I can give energy, it's instantaneous. It's available 24/7 As long as you put enough energy into it. So anyway, you mentioned York, I think of New York as one of the better community solar markets in the US. It's not without its challenges. It is it is a it is a complicated market, it is a difficult market to operate in. But most of the community, the serious community, solar companies are giving a shot at the New York market. Compare and contrast, I guess, New York to other markets. Why is New York what it is today?

Yeah, I think well, it's the market I've had the pleasure of seeing mature over time from the very beginnings of pilot programme that came out of the reforming the energy vision programme, which was sort of a wide scale, that a lot of different things, but really response to Superstorm Sandy, Sandy here, and a lot of the devastation, I'm in New Jersey that definitely lived through that and a coastal community that that we saw here. And so that CVG pilot hits community distributed generation, what they call community, solar, New York has really grown and been given the licence to grow over time. And to become I think, a little more sophisticated as well transitioning from kind of a retail rate, virtual net metering tariff to now something called the value of distributed energy resources, just a little more certainly complex, but also a kind of tariff that builds into it locational price signals, time based price signals, environmental value, or the energy and capacity values and kind of summing those all up into a value stack, which is the how the solar projects are compensated. And that has had to be tweaked and improved over time, there's still tweaks and improvements that I think it would benefit from. But that has that has been the mechanism through which so much solar and so much community solar has been built in New York, we're now you know, according to New York regulators, we're now over six megawatts, and sort of the they're they had a number of plans. But the six megawatt goal was kind of the most recent until last very end of 2021, and then authorised, and in 2022, and expansion to a 10 gigawatt distributed generation goal and putting really funding and incentives behind behind that, which I think is critical that as as these markets, mature and transition, if you if you want those resources to be built and deployed, you have to put the resources there to do that. And so incentives for not just kind of at a base level for building community solar. But also we've seen newer incentives come around for serving low to moderate income customers, for instance, the inclusive community solar attr, which about 400 megawatts of that came flying off the shelves last year, and we hope to see more of that this year. And they're also kind of locational based, or I guess, citing specific attars. In terms of brownfields development, for instance. I know they're they're going to they've proposed a new floating PV adder, which is pretty interesting, I think a sort of technology or sub genre that we're all learning about. So New York has been I think, successful and resourcing the work in creating a tariff and refining a tariff. That works and then also is not really a cat programme per se and that of course, the There's only a certain amount of incentive there. But there is the ability to to develop as many megawatts of, of Digi as as the grid can support. And and I think that's been a tremendous boon to the community solar industry, as we've seen, you know, six and now marching towards 1010. Excuse me, gigawatts. Yes. planned and installed.

Do you know by when is that 10 gigawatt mark.

That's supposed to be by 2030. Okay. But we are they have started up again, with the funding and incentives that would take us from six to 10 gigawatts last I guess, late spring, early summer. And we are currently just in November hit the sort of mid programme mark for that expansion. So in about six months time, about half of the resources that are meant to incentivize that additional four gigawatts were expended. So we'll see if it if it takes us all the way up to 2030. I think it's a good problem for the state to have in terms of the proliferation of of solar development.

Yeah. 10 gigawatts is a lot. I mean, the whole US market, the whole instal base of of solar in the US is just over 100 gigawatts, if I, if I recall correctly, is it not about 100 gigawatts?

That sounds about right. It's yeah, it's definitely leading market. And you see, definitely, Massachusetts is another another market leader. And get a little I will not be be too far and continuing to grow behind that. So we'd love to see California added to that list.

Yep. Yep. So I guess the question begs, you know, what should energy professionals and authorities having jurisdiction, organisations like, the Illinois Power Agency, and NYSERDA, the CPUC? What should people really be thinking about? When it comes to laying the groundwork for a successful solar programme? A and B, what should they avoid? You know, it's, unfortunately, it's a lot easier to break things, or stop them. Sometimes, purposely, sometimes accidentally. And, but it's vital that we are constantly sharpening the saw and improving the landscape for the development of clean energy projects, right? Because we have, we have to decarbonize the economy in the next 20 years. And and it's a huge task, it's totally doable, but it can, it can happen, but only if we do things, you know, smarter and faster, so to speak. So what what what is on your mind, I guess about, about the future of community, solar? And how can we do it better?

Yeah, I think the you know, all across the board and all aspects of programme design, right, we want to see is our programmes that are are transparent, that are predictable, and the end that are just, and I think there are a couple elements to that I can elaborate on a little bit more, I think a huge make or break element of policy design for all of these different authorities to be considering is either the economics and the bill credit rate, the sort of value of which solar and community solar specifically is compensated. So I mentioned that Veeder value of distributed energy resources in New York, there is also a vom s or boss values solar tariff in Minnesota, which is has been pretty successful. So So getting that right. And really incorporating all of the value that solar brings to the grid is essential in quantifying that and quantifying the environmental values accurately and fully. And so that's something that will be definitely a big part of the programme design and in California pursuant to a B 2316. And looking forward to seeing a more robust consideration of that than just kind of the wholesale will sell right would, would provide so I think that that's really critical. And similar follow on to that idea of being transparent and really predictable is thinking about the size of a programme and and how that's allocated. I think one area where we've seen a lot of programmes struggle has been this kind of boom, bust cycle or start stop nature that may result from you having a certain Okay, we're gonna we're gonna do 200 megawatts. Through the initial procurement, or through an initial tranche or something like that, and then there's going to be some kind of waiting period, well, it's determined what the future of the markets going to look like. And that can be really disruptive. And it can be really difficult to plan for developers for kind of how to build pipeline in a state in a market. And I think it's just really, ideally, right, where we're kind of letting and sort of whether an uncapped, are kind of artificially not artificially kept amount of market capacity to come and serve customers. There are certainly many, many customers, more customers who are not served by these technologies, than they're being kind of big lot. So I think that's kind of less of a concern, and we're more erring in the direction of more restrictiveness, or kind of a lot more stark softness, it's also really difficult, right for labour markets. And for, you know, making sure that we're able to make investments and in people learning trades, and, and being trained in, in solar installation and in the professions that are necessary to build solar projects, and just having a really clear view and to future kind of market development. And ongoing market development is really important for those careers, so that that's a really critical part of it as well. Yeah, so those are two, two big ones, I would call out for sure.

Let's talk about that, that human capital side of things, you know, you can have the best legislation in the world. But if you don't have the trained installers, to build this infrastructure, that could be a major roadblock. And, you know, the IRA legislation does, does throw money at training programmes, which is great. And we have kind of a burgeoning ecosystem of organisations that are helping to grow that population, both among regular populations and low and middle income. I recently learned about the climate corps, you know, which is recruiting, I think, mostly inner city youth into, you know, becoming solar installers, and paying them a living wage, you know, paying them $20 an hour to become a solar installer. So that's a very good thing, right? We want to we want to see more living wage opportunities for our youth across the board. And then, you know, once they get into clean energy, there's there's many more higher wage opportunities once they become seasoned professionals. But how do you see this landscape from a workforce development perspective?

Yeah, it's absolutely critical, like you said, and there are specific call outs within the inflation reduction act around prevailing wage and making sure that these are, are well compensated jobs, and also not California legislation, HB 2316. There's also mentioned that these projects should be should be built at a standard of prevailing wage. So those are encouraging things to see. I think a lot of programmes across the country are adopting that in one form or fashion, New York as well. So I think that that's a trend certainly, and and it's yes, I mean, like you said, the sort of scale that we are trying to approach from where we are now to where we want to be in seven or 10 years or beyond that, we need a lot more professionals in this field. And it's great to the extent to that projects are able to incorporate a workforce development component. The recent New Mexico Community Solar RFP, for instance, could have been a non price process for the request for proposals for projects to participate in that programme that highlighted a lot of different both economic and environmental justice aspects. But one was if there was a workforce component, workforce development component and training component to some of these projects that were participating, that those projects would be scored more highly and given more consideration and wait so that there are a lot of different ways that regulators are approaching that and certainly that these are, you know, jobs that see as appealing career tracks whether or not it's something that they contemplated themselves in I mean, I think in a working on a very different side of the industry, but I never really thought I would end up working in clean energy coming from a foreign policy background, and I think they're just a lot of a lot of needs a lot of different facets and faces to renewable energy space that you can kind of any skill you can think of. There's there's a job.

Yeah, statistic that I've glommed on to is that we need a million electricians to come into the clean energy transition here in the coming decades, and that's a big opportunity. You know, you can get into a training programme with a high school education and be making six figures as you know, as a trained electrician, building all kinds of infrastructure, not just solar. I'm I'm biassed, I want to see them building solar farms, but rooftop solar. So well, what else should we talk about? Kelly, I really enjoyed this conversation. If there's more that our listeners should know about renewable properties, I'm happy to have you tell us about that or anything else on your mind about community solar.

Now, I'm sure you have a lot of renewable energy professionals from different walks of life listening to your show, and you know, very much we're always looking for, you know, partnerships with folks are kind of aligned and doing similar work in the industry. And, you know, we work together with EPCs, and have bought projects and acquired projects and work with, as I mentioned, I work with a lot of subscriber organisations who are helping us to identify customers for these projects. So I, you know, think continuing to connect and grow that ecosystem of all these different organisations that are part of the lifecycle, making a project is really essential to meeting our goals as an organisation meeting our goals as a clean energy economy. So we have to welcome folks to connect on those opportunities.

Excellent. And I want to give a shout out to a couple of organisations that I think are vital, first and foremost as the IEA, the Solar Energy Industries Association, but also the Coalition for society, the CCSA. Coalition for Community Solar, what is it a lot, access, or access? I can never remember what that stands for.

Yeah, they're in indispensable organisation absolutely doing critical critical work to advance these priorities at the federal level, state level and bringing together a lot of developers and other parties.

You can find them at Community Solar access.org. And then there's iosr, the Institute for local self reliance, they've been tracking the growth of community solar programmes, and I find that they have some of the best up to date information on their website. That's iosr.org. So Kelly, how can our listeners find you?

Oh, well, my my email and my phone number are on our website, which is renewprop.com R E N E W P R O P.com. So you can certainly find me there on on LinkedIn as well. Yeah, would love love to connect with folks. And you'll see, we're active posting a lot of company news on on LinkedIn lately.

Excellent. Well, I'm Tim Montague, you can find me at CleanPowerhour.com. Please connect with me on LinkedIn as well. Give us a rating and a review on Apple and Spotify that helps others find this content, which is so vital. And reach out to me. I love hearing from our listeners and hearing your ideas and suggestions for future topics and guests on the show. With that I want to say Thank you Kelly Roache, Director of Policy and community solar at renewable properties for coming on the show today. Thank you and I'm Tim Montague. Let's grow solar.