Organizations classify cuts to SGIP, SOMAH, and CalSHAPE as short-sighted decision that would exacerbate costs
SACRAMENTO, CA – California decision-makers are considering cuts to key energy programs that benefit school children, low-income communities, and California ratepayers. In response, a coalition of more than 25 clean energy, environmental, education, and affordable housing organizations submitted a letter calling on state leaders to reject potential cuts to the California Schools Healthy Air, Plumbing, and Efficiency (CalSHAPE) program, the Self-Generation Incentive Program (SGIP), and the Solar on Multifamily Affordable Housing (SOMAH) program.
National business association Advanced Energy United (United), part of the coalition that authored the letter, argues that such cuts would provide negligible reductions in energy bills in the short term while sacrificing the long-term climate and affordability benefits those programs provide. Said Edson Perez, United’s California policy lead, "Instead of looking at short-term measures that provide marginal, one-time affordability gains and could make the energy system more expensive, polluted, and dangerous in the long-term, state leaders should work on long-term structural reforms that take advantage of all the tools and technologies available and address the real drivers of skyrocketing rates."
The SGIP program provides incentives to support energy storage systems for vulnerable populations, such as those in high wildfire-risk areas and low-income communities. An impact report of its 2021-22 performance showed that SGIP systems generated $27 million in avoided cost benefits across utilities, savings that benefit all ratepayers. Further, it found that optimizing the performance of those systems through demand response programs, real-time rates, and/or virtual power plants (VPPs) could improve those utility-avoided cost benefits 4.5-fold.
Added Perez, “Programs that incentivize the deployment of distributed energy resources like SGIP and SOMAH have the potential to bring significant affordability, resiliency, and GHG reduction benefits to every single ratepayer if managed correctly through demand response or virtual power plant programs. California should be leveraging investments that support both vulnerable populations and all ratepayers, not backing away from them.”
The SOMAH program helps fund solar energy systems for multifamily affordable housing, cutting energy costs for low-income tenants and contributing to workforce and economic development in underserved communities. Tenants in SOMAH properties experience bill reductions from $21 to $39 per month.
"By maintaining and enhancing programs like SGIP, SOMAH, and CalSHAPE, California can continue to lead the nation in building a sustainable energy system that is also affordable, resilient, and equitable," said Perez.
United will continue to advocate for California to leverage proven clean technologies, many of which are developed in-state, to make the energy transition affordable and equitable.
Click here to learn more about Advanced Energy United’s work in California.