Background

In D.06-01-024, the Commission created the California Solar Initiative (CSI) with a total budget for solar incentives and programs of $2.8 billion over 11 years. The CSI budget includes $342 million budgeted for the solar portion of the 2006 Self-Generation Incentive Program (SGIP) in D.95-12-044. Under the 2006 SGIP program, the Commission initially pays solar incentives of $2.80/watt for qualifying new solar projects. In creating the CSI, the Commission adopted an automatic mechanism to reduce solar incentive payments at the beginning of each calendar year or when program participation reaches specific megawatt (MW) levels, whichever is earlier. (D.06-01-024, Appendix A, p. 15.)

A ruling on March 21, 2006 in this proceeding provided parties notice that applications for solar incentives under the SGIP program in 2006 had exceeded the first 50 MW "trigger" for automatic reductions. That ruling relied on information provided by the Commission's Energy Division staff that total solar PV project applications as of March 9, 2006 equaled 91 MW. The ruling directed the SGIP program administrators (PAs) to reduce solar PV incentive payments from $2.80/watt to $2.50/watt for all 2006 program applications exceeding the 50 MW threshold. The ruling allowed parties to comment within seven days if they had any objections to the implementation of the automatic trigger mechanism. Comments on the ruling were timely filed by Americans for Solar Power (ASPv), the California Solar Energy Industries Association (CAL SEIA), Pacific Gas and Electric Company (PG&E), Pv Now, Southern California Edison (SCE), San Diego Gas and Electric and Southern California Gas Company (SDG&E/SoCalGas), San Diego Regional Energy Office (SDREO), Sun Light & Power Company, and The Utility Reform Network (TURN).