EL SEGUNDO HERALD February 25, 2016 Page 7 Rooftop Solar Touches Off a Power Struggle By Rob McCarthy If solar work trucks seem to be everywhere on the road and in South Bay neighborhoods, it’s not your imagination. California is ground zero for the rooftop-solar revolution. Half of the nation’s homes that produce some or all of their electricity from the sun’s rays are in the state. California has the sunshine, the abundant population, and an environmentally friendly Gov. Jerry Brown. Sacramento favors clean energy, and state officials want 1 million solar rooftops by 2018. The federal government offers a home-solar tax credit, which it extended to the delight of the installation companies that feared losing a tax break that homeowners find attractive. Residential solar’s future isn’t crystal clear because of opposition from public-owned utilities. Southern California Edison and their investors stand to lose if California electric customers offset their lower monthly bills using solar power. Households that generate electricity and swap it for bill credit receive preferential treatment, the state’s big utilities argue. They asked the Public Utilities Commission to rewrite the rules so that solar-powered outliers pay more to Edison. The two-year deliberation ended last month in a 3-2 vote, which exposed the friction building between the old guard utilities and the new kid-on-the-block solar. The commissioners in a Solomonic decision gave each side something it wanted, but denied anyone a clear victory. “Our course is not for the rooftop solar industry or for the utilities,” Commission President Michael Picker said after the Jan. 28 meeting. The public utilities asked for and were granted a $75-$150 hookup fee from solarconversion homes in the future, plus additional monthly costs - known as non-bypassable charges - that assist low-income households and fund development programs. The home-solar industry conceded that the additional fees imposed on new and existing home-solar customers were fair. The average power bill for a solar household is expected to jump by $9 per month, up from $82. “We agree that all customers should pay the Public Purpose Program Charges (which fund low-income and clean energy programs), nuclear decommissioning and DWR bond charges,” wrote Sean Gallagher, vice president of state affairs for the Solar Energy Institutes Association, in the days leading up to the Public Utilities Commission vote in San Francisco. The Public Utilities Commission explained that being users of the grid made it only right that home-solar customers pay charges borne by other customers. The commission decided to levy new costs, but not to charge solar customers for the upkeep of transmission lines. The solar industry cheered that change, even as it prompted two commissioners to vote against a decision they said they otherwise would have supported. The non-bypassable charges were small potatoes compared to net-metering. The fears were so great that California might end net-metering in 2016 that 130,000 petitions were delivered in wheelbarrows to the commission’s San Francisco offices in favor of continuing net-metering. By the narrowest of margins, the Public Utilities Commission extended net-metering until 2019, when it will reconsider the contentious payment system consumers favor and utilities dislike. The Jan. 28 decision required Southern California Edison and other utilities to keep paying solar-powered homes and businesses the retail rate that Edison charges its customers. Net-energy is important to home-solar companies because it defrays the costs of buying or leasing a rooftop system. Net-metering households use the electric utility grid like a bank account. They can deposit electricity they don’t use immediately withdraw the same amount later (such as at night) at no net cost. It’s a year-round system, which allows households to build energy credit in summer when days are longer to compensate for shorter, winter days. The three-year reprieve saved Californians who’ve installed rooftop solar panels $4.8 billion and kept the renewable-energy option affordable, according to the Solar Energy Institutes Association. The industry lobbied California utility regulators to retain netmetering, as Colorado, New Mexico, New York and New Jersey have done, to keep rooftop systems affordable. The number of solar homes in the United States is fast approaching 1 million, with 65 percent of residential solar being installed in communities with median incomes below $70,000, according to industry figures. California leads the nation with 479,000 solar homes, and is nearly halfway to the goal of 1 million solar rooftops by 2018 . The utilities lobbied equally hard to sway the commission and its President Michael Picker, even introducing an 11th-hour proposal that critics said would jeopardize the federal tax credit for home solar conversions. The solar industry, which faced an uphill battle with Big Utilities despite strong political support from the governor, criticized the late changes and Big Utility’s tactics. Picker said it had been a “very difficult task” for the agency to keep solar affordable without burdening most Californians with significantly higher costs. He characterized the net-metering program as “a big step forward toward giving California consumers 2016 EL SEGUNDO ELECTIONS Residents and Business Owners El Segundo’s Election is on April, 12, 2016 Have any questions for your City Council candidates? Send them to us at management@heraldpublications.com We will not be able to publish all submissions. City of El Segundo is now hiring for part-time positions Drivers starting at $15.93/hour Lifeguards starting at $12.45/hour Visit www.elsegundo.org and click on City Jobs, Part-Time Opportunities for more information or call (310) 524-2700 drivers of value, or simply be in a better position to take advantage of opportunities. In addition to measuring business health and preparing it for sale at some immediate or future date, there are other considerations in knowing what your business is worth, including funding a buy-sell agreement, retirement income planning and estate tax planning. 2. Turn to a credentialed valuation expert. A proper business valuation is not a “rule of thumb” or a figure agreed to with a handshake; it’s thoughtfully crafted by a credentialed appraiser after thorough research and is documented in writing. Credentials to look for include: Certified Valuation Analyst (CVA), Accredited Senior Appraiser (ASA) or Accredited in Business Valuation (ABV). 3. Fund any potential “value gaps.” Once you know the value of your business, it’s common for there to be a discrepancy between what you thought the business was worth and what you need the business to be worth. The good news is proper planning can help reduce potential “value gaps” created by an owner’s over- or under-estimation of the business’s value. For example, having assets outside the business, such as qualified plans and other investments, can help reduce the value gap in your retirement plan. In addition, insurance products, such as life insurance and disability income insurance, can help address the value gap created if a business goes into forced liquidation following the death or disability of an owner. Take the next step. Talk to a qualified financial professional about where your business is now and where you’d like it to be in the future, and to find financial solutions that can help you reach your goals. • Finance 3 Tips For Evaluating What Your Business Is Worth (BPT) - Financial and business education is a critical pathway for the future of America’s small business community. To start with, business owners should ask themselves: “What is the true value of my business?” It’s an important question because the value of your business will have a big impact on both the professional and personal aspects of your life, including the well-being of your family, employees and possibly even the community in which your business in located. The 2015 Business Owner Perspectives study commissioned by Massachusetts Mutual Life Insurance Company (MassMutual) revealed about half of business owners say they’ve had their businesses valued in the past three years, yet one out of three says they’ve done the valuations themselves. When business owners value the business themselves, they can significantly over or under value their business. Knowing your business’ true value gives you a more realistic perspective and allows you to put effective strategies into place for future growth, business continuation, succession planning, and retirement planning. Here are three tips for evaluating what your business is worth. 1. Times to know the value of your business. Because of constant change in the economic, competitive and regulatory landscape in which so many businesses exist today, it’s a good idea to review the value of your business on a regular basis. Doing this will allow you to have a firm grasp on the business’s current value and track its growth over an extended period of time. With this knowledge, you could consider adjusting your business plans to focus more on the See Rooftop Solar, page 17
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