To meet Governor Jerry Brown’s proposed 2030 climate and clean energy goals, we need to implement market transformation strategies for increasing the supply of distributed energy resources from all California households and businesses. We must work with disadvantaged communities to break down barriers to adoption and empower community members to supply to the grid more energy efficiency, demand response, distributed generation, energy storage and managed charging of electric vehicles.

Policies need to drive the market                                             

Market transformation strategies increase the adoption of preferred technologies and actions in target markets over a longer time horizon, such as 5-10 years. Market transformation strategies are necessary and additional to “resource acquisition” policies, which focus on utilities procuring what’s already available and cost-effective today. For example, California’s “loading order” policy requires utilities to procure all cost-effective and available preferred resources first. The replacement of the San Onofre Nuclear Generating Station (SONGS) illustrates the limitations of this approach. Citing concerns that there may not be sufficient cost-effective and available preferred resources to displace the need for a new power plant, California Public Utilities Commissioner President Michael Picker recommended approval of the proposed Carlsbad gas-fired power plant on April 6.

The SONGS replacement example also illustrates the need for an independent entity that is responsible for transforming markets for distributed energy resources and ensuring that sufficient cost-effective preferred resources will be available in time to meet our goals. Repeatedly, California utilities have proposed fossil-fired power plant solutions, rather than proving that they can deliver the large quantities of energy efficiency, distributed generation, demand response and other clean distributed resources to meet reliability needs. Accordingly, CSE supports Senate Bill 765 (Wolk), which would create an independent California Market Transformation Authority.

Disadvantaged communities must be part of the mix

In the past, California policymakers and program administrators have generally designed market transformation initiatives for distributed energy resources to target early adopters and other customer segments that have the fewest barriers to adoption and are perceived as most likely to take action. While this approach may have been appropriate for developing markets for new and expensive technologies, it is not a sustainable path for making clean, distributed power sources a major portion of our resource mix.

Disadvantaged communities face a range of barriers to adoption, including barriers associated with lower income levels, lower rates of single-family home ownership, and language and cultural barriers. CSE is working with stakeholders to tackle several of these barriers and empower disadvantaged community members.

Tackling barriers to adoption

Many distributed resource programs and incentives primarily benefit single-family homeowners, and it has been challenging to increase participation by renters and landlords. To increase solar installations on multifamily residential properties, CSE is leading the Virtual Net Metering Market Development Project to expand the awareness, effectiveness and use of virtual net energy metering (VNEM) in California and beyond.

Marketing, education and outreach to disadvantaged communities also presents significant barriers. These communities include a large number of households that have adults who do not speak English very well, higher levels of poverty and/or lower levels of education. As the program administrator of Energy Upgrade California®, CSE is implementing strategies to address the cultural and language barriers that have held back understanding, motivation and adoption of distributed resources in the past. For example, Energy Upgrade California has partnered with 75 community-based organizations across the state to educate, motivate and activate their community members to better manage their energy use. This ambassador program provides training, technical assistance, and in-language, culturally appropriate informational materials to community based organizations.

To meet California’s ambitious 2030 goals, we must continue to work with disadvantaged communities to tackle barriers to adoption and tap the power of the people.