Climate advocates on Monday asked the California Supreme Court to reverse a new rooftop solar panel policy in the state that the groups say has proven "irony is alive and well," as the policy is impeding the expansion of renewable energy in California just as regulators are calling for a solution to the state's energy crisis. 

The California Public Utilities Commission (CPUC) approved a new solar policy last year at the urging of the state's three investor-owned utilities, led by Pacific Gas & Electric. The new rules slashed a solar power incentive for homeowners by about 75%, sharply reducing the amount utilities pay people with solar panels when they sell surplus power to the grid. 

The "disastrous decision," made with the approval of three companies whose "only real competition" is customer-owned solar, said the Environmental Working Group (EWG), has reduced solar industry jobs by 17,000 in less than a year, and the group reported that "75% of California's once-thriving rooftop solar installation companies face a 'high risk' of bankruptcy."

A state appeals court upheld CPUC's new policy last month, leading EWG, the Center for Biological Diversity (CBD), and the Protect Our Communities Foundation (POCF) to bring the case to the state Supreme Court.

"California utility regulators shouldn't be untouchable and I'm hopeful the state's highest court will agree," said Roger Lin, a senior attorney at CBD. "The commission shrugged off California's climate goals, put rooftop solar's benefits further out of reach of working-class families, and gave another gift to corporate utilities."

Last month, Lin said, "the appeals court wrongly deferred to these state regulators. This sets a dangerous precedent of endorsing utility talking points and torpedoing an essential tool to fight the climate emergency and environmental injustice."

CBD noted that the California Court of Appeals ignored a state law that "requires the court to review the commission's decisions as it would those of any state agency." 

The three-judge panel claimed there was "no basis for faulting the commission's work."

State Sen. Scott Wiener (D-11) said the state is "shooting itself in the foot" by following the guidance of utilities which have a financial interest in reducing solar energy even as the state promotes its ambitious climate goals. 

"California is shooting itself in the foot by dramatically reducing support for rooftop solar, which is key to meeting our climate goals. We need to reverse this bad move by the California Public Utilities Commission." pic.twitter.com/KG79mDSjwN

— Senator Scott Wiener (@Scott_Wiener) January 28, 2024

As CalMatters reported last week, California's aim of transitioning to 90% carbon-free electricity by 2035 and 100% by 2045 requires a significant shift to solar power.

"The market is in the gutter," Bernadette Del Chiaro, executive director of the California Solar & Storage Association, told CalMatters. "It should be no surprise to anybody. If you are a business and your market took a 80% nosedive, with great pain, you have to lay off. Some companies shut their doors."

"We are talking about the largest solar market in the country," Del Chiaro added. "This was the most impactful energy decision, easily, for this century so far."

EWG accused California regulators of holding a "confused position" on energy sources, as the group is also challenging a separate decision by the state in the U.S. Court of Appeals for the 9th Circuit. In that case, EWG is joining Friends of the Earth and Mothers for Peace in arguing against extending operations for "the dangerous, outdated Diablo Canyon nuclear plant," which opponents say runs a safety risk as the plant as its reactors are on several earthquake fault lines.

In the Diablo Canyon case, said EWG, "California is arguing—apparently with zero self-awareness—that the state is in the midst of an energy crisis and needs to generate more electricity... Solar is one of the energy leading solutions, but California can't even seem to agree with itself on the right path forward."

In its state Supreme Court case launched on Monday, EWG said it was asking the court to review the CPUC's "failure to assess the far-reaching benefits of widespread customer-owned rooftop solar."

"Instead, in approving the utility's plan, the commission looked at a narrow set of economic factors only," said EWG. "We'll argue this violates the CPUC's duty under state law to look at a broader range of benefits."

The commission impeded the expansion of rooftop solar power in the state as climate scientists and energy experts have made clear that extreme weather events including wildfires—which have increasingly plagued California in recent years—are intensifying and growing more destructive as a result of continued fossil fuel extraction and planetary heating.

CalMatters reported that the loss of solar power jobs has also devastated communities that would have benefited from employment in the growing industry, which pays solar panel installers an average of $70,000 per year.

"These jobs have been a foot in the door for people who have been in the justice system; their lives have changed," said Adewale OgunBadejo, vice president of workforce development for the non-profit Grid Alternatives, told CalMatters. "This is 100% a job killer."

Caroline Leary, general counsel and chief operating officer at EWG, said it was "absurd" to leave "the destiny of California's clean energy aspirations and the battle against the climate crisis" up to the CPUC's five unelected members.

"We can only hope the state's Supreme Court shares this sentiment," said Leary. "The prospects of California attaining Gov. Newsom's ambitious emissions reduction goals are non-existent without a robust and expanding rooftop solar program. The CPUC's disastrous decision at the behest of PG&E and the other monopoly utilities is the most significant setback imaginable in our pursuit of meeting these crucial benchmarks."