California Solar Initiative
Draft Staff Proposal for Research, Development and Demonstration Plan

On January 12, 2006, The California Public Utilities established an RD&D budget for distributed solar under the CSI to help achieve the CSI's 3000 MW goal for solar installations by 2016.  The Commission's intent for RD&D is to "explore solar technologies and other distributed generation technologies that employ or could employ solar for power generation and storage or to offset natural gas usage, as well as market development strategies."

On August 21, 2006, the Legislature directed the CPUC in SB1 to allocate not more than $50 million to research, development, and demonstration that explores as part of the California Solar Initiative:
1. solar technologies, or
2. other distributed generation technologies that employ or could employ solar energy for generation or storage of electricity or to offset natural gas usage.

The overall goal of the RD&D funds is to help build a sustainable and self-supporting industry for customer-sited solar in California.  A clearer way to describe this goal in operational terms might be to say the CSI program needs to achieve two key outcomes:

• Move the market from the current retail solar price of $9/watt or about 30 cents/kWh to levels that are comparable to the retail price of electricity.
• Install increasing volumes of solar DG that build from the current range of 40+MW per year to 350 MW or more per year.

The funds will be used to fill critical needs or gaps in the market to facilitate greatly expanded market penetration of cost-effective solar applications. The RD&D program effort is intended to produce results to ensure achieving the goal of 3000 MW of solar DG and without further ratepayer subsidy beyond 2016.

On February 14, 2007, PUC Energy Division staff issued a proposal with a draft RD&D strategy, criteria for selecting projects, and a timeframe for this support. The PUC Energy Division held a workshop to review the staff-proposed Research, Development, and Demonstration Plan.

Based on workshop feedback and written comments, staff refined its proposal on April 2, 2007 for a subsequent round of formal parties' comments. The final proposal and comments will inform a proposed decision.