The California Public Utilities Commission (CPUC) rejected Sunnova’s application to build and operate microgrids, which are operated separately from the state’s power grid, in new master-planned communities. CPUC ruled that the exemptions Sunnova requested under Section 2780 and Section 1001 of the California Public Utilities Code are unauthorized, and the company did not provide regulators with the needed information.
Sunnova planned to work with homebuilders to build and operate solar photovoltaic (PV) and storage microgrids for new home developments of up to 2,000 homes. The company proposed to operate as the state’s first “microutility” for each of these master-planned communities. This would have required rooftop solar and battery storage in each home, community solar and storage, backup generation, and microgrid infrastructure. Sunnova would have had ownership of the microgrid and been responsible for serving and billing.
Sunnova was required to file an application with the CPUC, as Section 218 of the California Public Utilities Code requires that an entity that sells electricity to more than two neighboring properties or to any nonadjacent property must become an electrical corporation regulated by the CPUC.
California’s investor-owned utilities (Pacific Gas & Electric Co., San Diego Gas & Electric Co., and Southern California Edison) protested the plan. PG&E and SDG&E also raised opposition. The CPUC Public Advocates Office filed a motion to dismiss the application to allow the CPUC to continue its consideration of community microgrid issues required in its ongoing microgrid rulemaking process. (SB 1339, enacted in 2018, directs the CPUC to develop policies related to microgrids.) Sunnova argued for a public hearing on the proposal, stating that its application met CPUC requirements.