Solar Power Used to Subsidize California’s Wealthiest Citizens

February 8, 2022

At PTF, we’ve outlined the many ways that so-called ‘green’ policies often help to subsidize or enrich the wealthy. So, while Hollywood celebrities decry fossil fuels (even as they board their private jets), it’s important to remember that many are making money off of the green policies they endorse.

One case in point is California. The state’s net-metering program allows homeowners with solar panels to collect rebates for any extra power they produce and send back to the grid. The problem is this compensation to homeowners is completely out of line with what other power generators are paid, and sometimes are as much as ten times higher.

Today’s lead editorial in The Wall Street Journal exposes the unfair nature of the net-metering scheme:

Net-metering is highly regressive and becoming unsustainable as more affluent homeowners install solar panels. The bottom 40% of income earners in California account for only about 13% of solar customers. A study by the left-leaning outlet Next 10 last year estimated that this cost shift translates into $230 more for an average annual electric bill.

Even the Sierra Club says in California “the solar industry has matured to a point where a smaller [solar] incentive is appropriate.” Greens worry that skyrocketing retail rates due to net-metering and other green subsidies may discourage lower- and middle-income folks from buying electric cars and appliances.

With even The Sierra Club calling for decreasing solar subsidies, who could be left to defend this practice which puts money in the hands of the wealthy at the expense of everyone else? Not surprisingly, it’s the same wealthy folks who regularly champion environmental causes. As the editorial continues: 

An agency administrative law judge last month proposed scaling back credits for excess solar power sent to the grid and adding a fixed monthly charge averaging $20 to $40 to solar customer bills to cover their grid costs… Greens support the proposal, but the celebrity class has blown a fuse. Former Gov. Arnold Schwarzenegger recently wrote a New York Times op-ed denouncing it as a “solar tax.” Actor Edward Norton tweeted that it “will destroy the rooftop solar market.” Elon Musk, whose Tesla sells solar panels, calls it “a bizarre anti-environment move.”

We should all remember these wealthy activists the next time one of them complains about energy sector profits.