The California Public Utilities commission has approved feed-in tariffs for renewable energy that allow residents or businesses with clean power-generating sources–like solar or biogas–to sell electricity to large utility companies. However, the pricing structure does not pay a premium for renewable kilowatts the way that feed-in tariffs in Germany do.
The solar industry in particular stands to gain little from the tariff pricing which ranges from 8 cents to 31 cents per kilowatt hour, depending on a range of factors, including the time of day the energy is produced.
This pricing structure means a person who sells excess electricity from a roof-mounted solar system to a regional utility company would receive the same rate the utility pays for electricity produced by a large gas turbine.
The tariff system allows utilities to add up to 480 megawatts to the state’s renewable portfolio of energy supply, but owners of solar systems will generally do better by taking the rebate supplied by the California Solar Initiative and participating in net metering–through which they receive retail credit for excess energy produced by their systems.
Individuals or companies who sell energy under the feed-in tariffs cannot participate in other incentive programs.
Although the California tariffs are not as valuable as German tariffs, which offer around 56 euro cents per kilowatt hour, they will be valuable to other small energy producers, such as farmers who employ biogas energy systems, which do not have the support of other incentives programs.
In addition the approval of a feed-in tariff creates a precedent on which other states can lean in debating the merits of a system.
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