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Liam Denning

California's Solar Subsidy Pullback Isn't So Bad

The state needs to improve its incentives for rooftop panels to ensure that all costs are reasonable and fair.

California needs to improve its subsidies .

California needs to improve its subsidies .

Photographer: David Paul Morris/Bloomberg

California is where solar advocates go for good news. So the latest headlines came as a bit of a shock:

But solar fans should take a breath: The news isn’t so bad. The California Public Utilities Commission released proposed reforms to the state’s net-metering standards. Net-metering is a subsidy for rooftop solar systems whereby homeowners are paid for any spare electricity they export to the grid. Today, they’re paid almost the full retail rate in California — which is high. The average household tariff is more than 23 cents per kilowatt-hour, two-thirds more than the national average.