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Google-California Deal Should Be a Wake-Up Call: Digital Monopolies Hurt Journalism
Google is the sole winner of this deal, and this should be an example of what not to do to redress power and financial imbalances between news media and large digital platforms.
Sep 05, 2024
A California-Google deal that would provide $250 million for local journalism and an “AI accelerator” program was announced by California Gov. Gavin Newsom as a “major breakthrough” to ensure the “survival” of newsrooms across the state. In exchange, the state has agreed to kill the California Journalism Protection Act, a bill that would have forced the tech giant to share revenues with news publishers and which was deemed to be more transparent than similar legislation in Australia and Canada.
News publishers and other advocates focusing on the good side of the deal (more money) have also been cautious about celebrating it. Journalists’ unions and associations have been more straightforward in decrying it. Altogether, newsrooms are feeling the toll of elongating their “survival” mode, especially if the trade-off is to continue handing their future to those who helped create their crisis.
By eliminating legislation enforcing revenue-share agreements, California has reduced Google’s financial liability compared with Australia and Canada, where news outlets, including broadcasters, are compensated for creating value for Google. In addition, Google got the state of California to pick up an important portion of the $250 million bill using public funding. More significantly, the deal allowed the corporation to avert disclosing how much value news generates for Google’s search engine, which estimates put at $21 billion a year in the U.S. based on searches using news media content.
Concentrated market power is hurting the chances for a free and financially independent press to thrive.
Let’s be clear: Google is the sole winner of this deal, and this should be an example of what not to do to redress power and financial imbalances between news media and large digital platforms. If anything, it should be a wake-up call to the harmful effects of digital monopolies on the news media industry. Governments can no longer spare Google and other tech giants from their role in the financial crisis of journalism.
The recent ruling from a federal district court confirming Google’s monopoly over search tells part of this story. Although that case didn’t address the corporation’s impact on newsrooms, we learned that Google’s grip on advertising demand couldn’t have been achieved without a key illegal practice: its multibillion-dollar contracts with phone makers that were designed to squash rival search engines. Today, search advertising continues to be the largest channel capturing ad spend in the U.S.
Most importantly, this stranglehold enabled Google to constrain media’s bargaining power and prevent any meaningful discussion about the dollar value news content provided to its search engine—as the looming threat of permanently turning off news access would have hurt the press even more. Without significant challengers to Google’s search engine, newsrooms are beholden to Google’s whims for news discoverability and distribution on search results.
A separate trial starting next week tackling Google’s monopoly over advertising technologies (ad-tech) is likely to complete the story of this corporation’s role in this crisis. The ad-tech industry, once thought to help news publishers make revenue from digital, has become extraordinarily complex, opaque, and concentrated. At the same time, it is the backbone that connects advertisers and publishers to buy and sell ads across the web—providing an alternative to search and social media ads, all of which drives a marketplace worth around $300 billion in the United States alone.
Besides controlling search ad revenues, Google also controls the ad-tech platforms upon which most ad sales by news publishers are made. Without getting too technical, in practice this means Google has eyes on the value of news publishers’ ad inventory, on advertisers’ preferences and perceptions about those publishers, and on the algorithms that connect the two to determine ad prices.
Also unchallenged, Google controls between 50% and 90% of transactions in each layer of this market, where it takes a cut of about 35% of each ad dollar spent. In the trial, the Department of Justice is expected to cut through the ad-tech complexity and show how Google has also manipulated ad prices to divert ad dollars away from news publishers into the tech giant’s own pockets. For the first time in many years, in this case the DOJ is seeking a breakup to redress Google’s harms.
As a counterargument, Google has been trying to push a story in which a “very competitive” market already exists, since multiple giants in various other sectors—Amazon, Walmart, CVS, etc.—are also competing for ad dollars. This view invites us to presume news publishers and journalists must be doing something wrong, so what else is there to do but to help them to “survive” in this brave, new world?
But nothing could be further from the truth. Newsrooms across the world have not stopped innovating, changing their revenue models, and adapting to audiences’ new habits. Journalists continue to defend their trade and the rights that ensure they can do their jobs safely. People still want to find reliable news. But when it comes to competition, how do we even call it that when a handful of players control not only where news is discovered and accessed, but also drive appetite to monetize audiences’ personal data, and ultimately assign value to a publisher’s ad inventory?
The fight for legislation in California that would redress these imbalances was the first step—not the ultimate fix—to coming out of the “survival” mentality that has been entrenched for far too long in journalism. Concentrated market power is hurting the chances for a free and financially independent press to thrive. As long as short-term fixes like the California-Google deal, obscure this reality, we will continue to allow the very same people we should be holding accountable to shape the future of democracy.
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Democratic Climate Heroes... and Villains
The reminder that there’s no automatic connection between a D next to your name and some courage on climate comes from many spots around the country, including in the deep blue Northeast.
Aug 23, 2024
Much of my past month has been spent Kamaling—I don’t know if I hold the record, but along with helping organize and MC the Elders for Kamala call, I’ve made cameos on Climate Leaders for, Oudoor and Conservation Leaders for, Christians for, and Vermonters for. I’m for. U.S. Vice President Kamala Harris and Minnesota Gov. Tim Walz have run a sparkling campaign so far, and this week’s convention in Chicago is a reminder that Democrats look and sound like America at its best. As opposed to the monochrome and bitter gathering that nominated former President Donald Trump (“Mass Deportations Now”), it’s been one long Party party. (When Patti LaBelle kicked off Tuesday night’s proceedings, the musician gap with the GOP grew unbridgeably wide).
Which is not to say that Harris will be a sterling climate president—we’ll have to wait and see, because we had no primary to press her on it. I don’t like long campaigns any more than anyone else, but in our system they are the only place activists can actually make a forceful case—that’s how climate became a real presidential issue for the first time in the 2020 race, which led quite directly to the Inflation Reduction Act. (And now, instead of a second-term Democrat freed to act with relative abandon, we’ll have a first-termer constrained by thoughts of her re-elect). So we’ll doubtless have to push her, once we’ve helped push her into the White House.
The reminder that there’s no automatic connection between a D next to your name and some courage on climate comes from many spots around the country, including even some where lots of good work has been done. Michigan Gov. Gretchen Whitmer and Coach Walz have gotten high high marks—converting narrow legislative margins into big action packages.
But places where it should be easier—in the deep blue, not the purple— haven’t gone as well. Gov. Gavin Newsom’s California has accomplished a lot with the move to solar power, as I’ve been writing about all spring—but he also has gutted both rooftop solar and community solar this spring. According to the Solar Rights Alliance, 22% of all solar jobs in the state have disappeared. That’s just stupid policy: Rooftop solar, among other things, has dramatically decreased the amount of electricity the grid needs to provide, which may be why the utilities hate it. (Texas Republicans, meanwhile, have made one attempt after another to gut renewables, but they may have waited too long—there’s enough money behind wind and sun now to defeat such efforts, and the state’s renewables, and just as importantly its battery fleet, are now growing like topsy.)
The closer we move to actual implementation of the big climate promises that politicians made during the Greta years, the more of this kind of backsliding we’re going to see.
And on the other side of the country, in the deep blue Northeast?
New York could and should be a renewable powerhouse. It lacks a Mojave Desert, but Long Island Sound could be the Qatar of offshore wind—the DOE estimates it could power 11 million homes, which is 4 million more homes than New York contains. With NYSERDA, the New York State Energy Research and Development Authority, it has some of the finest energy conservation minds in the country. And it has an environmentally minded populace—everyone thinks about New York City as a liberal bastion, but it was upstaters who banded together to force a ban on fracking.
And yet the state is lagging badly, in no small part thanks to Gov. Kathy Hochul. The Buffalo-area pol, who ascended more or less accidentally to her job when Andrew Cuomo couldn’t stop grabbing the women who worked for him, got perhaps her biggest moment of infamy earlier this year when, out of nowhere, she shifted 180° her position on congestion pricing in lower Manhattan and nixed the program—weeks after she’d given a long speech extolling it, and past the point where the city and state had spent hundreds of millions of dollars buying the cameras to make it work.
But that’s not her only anti-climate act. She’s also sat on her hands for months now after the state legislature passed the Climate Superfund act, which would send the bill for climate disasters to the oil companies that caused them. (You can sign a petition for the Superfund here). And now she’s “pondering” a “relaxation” of the state’s basic climate law, which promises to use renewables for 70% of the state’s power by 2030. According to Inside Climate News, she told reporters recently that “the goals are still worthy. But we have to think about the collateral damage of these decisions. Either mitigate them or rethink them.”
Why? Well, because she’s hearing from groups like
the Business Council of New York State ... They want to go beyond pushing back CLCPA deadlines. They hope to rewrite the law itself, targeting mandates to electrify buildings, passenger vehicles, and school buses.
“We are now at a point where implementation challenges call for a reassessment of the underlying statutory mandates,” the Business Council said July 30 while releasing a letter to Hochul signed by 60 business, fossil fuel, labor, farming, and small business groups.
This is the kind of utterly predictable pushback that confident legislators simply manage with a few well-chosen words, even as they push forward. (See, Joe Biden). But Hochul shows no sign of that kind of confidence. NYRenews, the group that has helped push much of the New York legislation, released a report yesterday showing that under Hochul’s leadership, the state’s four key implementation agencies are sitting on their hands.
Only a handful of agencies have issued specific guidance or regulations to support compliance efforts. Notably, it appears that the state’s largest and most powerful agencies have entirely failed to comply with the Climate Act and have not yet issued policies or guidance on implementation of the law.
For example:
• The New York State Department of Transportation (“NYSDOT”) has pushed forward at least 40 highway expansion projects without properly assessing their impacts on DACs and the climate;
• Empire State Development (“ESD”) has awarded at least $780 million in clean energy funding without ensuring that 40% of the benefits go to DACs;
• The New York Education Department (“NYSED”) has approved at least 25,971 construction projects at public schools across the state without properly assessing their climate and DAC impacts; and
• The New York State Department of Health (“NYSDOH”) has approved at least 223 construction projects for new and renovated healthcare facilities without assessing or mitigating their climate impacts.
This is where leadership makes a difference, one way or the other. You need some nerve—(something like, though in reverse, the chutzpah of the New York Republican legislator who last week penned an op-ed explaining that this summer’s violent storms were a reason to postpone climate action). Hochul, casting New York’s votes at the convention Tuesday night, cited the Empire State as the birthplace of the women’s rights and gay rights movement. If she were smart she’d listen to impassioned voices from the climate movement, who also know something about reality: Listen to Bob Howarth, the world-leading methane scientist who also sits on the board charged with implementing the new law.
“I am appalled at this pushback against the CLCPA by business interests pushing their short-sighted agenda,” Howarth told WaterFront. “Climate change is very real. The consequences of climate disruption (floods, droughts, fires, crop failures) are becoming increasing obvious to all.”
“The political leaders of NY understood these dangers when they drafted the CLCPA and its predecessor beginning in 2015…. Due to political delay, we may miss CLCPA targets by a few years. But the needed trajectory remains clear.”
Howarth sits on the state’s Climate Action Council, which passed a plan to implement CLCPA in December 2022 (by a vote of 19-3). The council had determined that “it was entirely possible and reasonable to meet the CLCPA goals and targets… that would benefit individual homeowners,” Howarth said.
Furthermore, the successful implementation of CLCPA would set an example to the world by showing “that a globally important economy could thrive while addressing the climate crisis and moving away from fossil fuels,” he added.
But the council hasn’t met for many months. “The state simply has not seen adequate political leadership to move ahead with the CLCPA goals and the council’s plan,” he said.
Something similar is happening in New York City where Mayor Eric Adams, in between dealing with corruption investigations, has done his best to weaken the city’s landmark Law 97. As Pete Sikora of New York Communities for Change explained to me, he’s pushed back the implementation date for the statute, which mandates efficiency improvements in big buildings. (Not surprisingly, he’s taken lots of campaign money from real estate interests).
The two year delay he's created will cost thousands of jobs and raise pollution yearly by a few hundred thousand tons per year as landlords put off energy efficiency projects (more worrying: it's a signal he'll further weaken the law if reelected and the major pollution limit starts in 2030).
But Adams—well, he’s also attempting to turn one of the city’s neighborhood landmarks, the Elizabeth Street Garden, into a housing complex. The city needs housing, which is why the garden’s friends have come up with all kinds of alternate sites in the same neighborhood, but so far he hasn’t yielded, even thought even Murdoch’s New York Post has made it clear what a bad idea the development is. Now, the Timesreports, there’s been a huge letter-writing campaign from local public school students.
For the 575 or so students who attend P.S. 130, Elizabeth Street Garden serves as an extension of the classroom. The elementary school lacks green space, but it is only a 10-minute walk from the garden, allowing for frequent visits and class trips. So the garden has become a de facto playground and nature center where the children can plant seeds, learn about nature, and have Easter egg hunts.
“Tree’s also provide homes for animals like birds, squirrels, and raccoons. This is why we should save the garden!” wrote one student.
Another explained, “The garden adds color and brightness to the city.”
Many were concerned about their favorite play space disappearing: “One reason why we should keep the garden is because with all the trees, we can play hide and seek and eat lunch.”
One reason that pols like Hochul and Adams can get away with moves like this is that there’s very little coverage—the Elizabeth Street garden is the exception that proves the rule. Indeed, the Times announced last week that it would no longer endorse candidates for local office, which is odd since those were probably the only endorsements the paper made that actually moved voters. Albany, meanwhile, exists in a news vacuum—the number of voters who know that Hochul is emerging as a northern DeSantis on climate issues is minuscule.
The closer we move to actual implementation of the big climate promises that politicians made during the Greta years, the more of this kind of backsliding we’re going to see. Consider, just as a random example, Connecticut, where utility regulators have introduced an excellent system of performance-based regulation for power providers, moving away from the old system which basically just takes a utility’s costs and adds a chunk of profit on top. The Nutmeg State’s two big utilities have fought it from the start, and now they’re moving to have the regulator who introduced it, Marissa Gillett, fired. The state’s governor, Ned Lamont, said when the law was introduced that “you just don’t get paid an automatic 9% whether you do good work or bad work. You get paid for doing good work.” Now we’ll see if he has the courage to keep her at her job. Or Massachusetts, where the legislature adjourned without taking up the crucial enabling legislation for the state’s climate law—there’s some talk that governor (and climate hawk) Maura Healey might call them back for a special session, but more likely it will drag on for another year. Delay is the new denial.
Or take Delaware—the state needs to develop its offshore wind resources to meet climate goals. Indeed, given its relatively small population, it could become a linchpin for the entire Atlantic seaboard. But though polling shows strong support across the region, well-financed opponents have successfully made it appear that grassroots opposition is growing, particularly in coastal communities. I’ve watched it happen in Cape Cod, where activists are trying to block the cable necessary to bring power onshore from turbines, and in Maine where other activists want to block the construction of the terminal to support the offshore farms. There are always arguments—perfect enemy of the good—but none of them make much sense in a world where August looks like it will be even hotter than last year’s all-time record. It’s why, when real champions emerge—say, former National Wildlife Federation CEO Collin O’Mara, running in the Democratic primary for Delaware governor—change gets so much easier.
The default is always to the status quo. For Republicans that means fossil fuel uber alles. For Democrats, too often, it means “don’t ruffle more feathers than you have to.” That’s why we always have to make sure that there are plenty of climate hawks with plenty of feathers.
Correction: An earlier version of this op-ed mistakenly identified Gretchen Whitmer as the governor of Wisconsin. She is the governor of Michigan.
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Why Is ‘Climate Change Crusader’ Newsom Waging War on Rooftop Solar?
The answer has more to do with protecting utility company profits the planet or low-income Californians.
Aug 14, 2024
California Gov. Gavin Newsom appears to be taking climate change seriously, at least when he’s in front of a microphone and flashing cameras. His talk then is direct and tough. He repeatedly points out that the planet is in danger and appears ready to act. He’s been called a “climate-change crusader” and a leader of America’s clean energy revolution.
“[California is] meeting the moment head-on as the hots get hotter, the dries get drier, the wets get wetter, simultaneous droughts and rain bombs,” Newsom typically asserted in April 2024 during an event at Central Valley Farm, which is powered by solar panels and batteries. “We have to address these issues with a ferocity that is required of us.”
These are exactly the types of remarks many of us wish we had heard from so many other elected officials addressing the climate disaster this planet’s becoming, the culprits behind it, and how we might begin to fix it. True, Big Oil long covered up internal research about how devastating climate change would be while lying through its teeth as its officials and lobbyists worked fiercely against any kind of global-warming-directed fossil fuel legislation. It’s also correct that the issue must be addressed immediately and forcefully. Yet, whatever Gov. Newsom might say, he’s also played a role in launching a war on rooftop solar power and so kneecapping California just when it was making remarkable strides in that very area of development.
Despite what Gov. Newsom and the California Public Utilities Commission have claimed, electric rates have increased not because of solar power’s massive success but because of old-school capitalist greed.
Consider California’s residential solar program (its “net-metering“), which the governor has all but dismantled. Believe it or not, in December 2022, the California Public Utilities Commission (CPUC) voted 5-0 to slash incentives for residents to place more solar power on their homes. Part of the boilerplate justification offered by the CPUC, Newsom, and the state’s utility companies was that payments to individuals whose houses produce such power were simply too high and badly impacted poor communities that had to deal with those rate increases. They’ve called this alleged problem a “cost-shift” from the wealthy to the poor. It matters not at all that the CPUC, which oversees consumer electric rates, has continually approved rate increases over the years. Solar was now to blame.
It’s true that property owners do place those solar power panels on their roofs. What is not true is that solar only benefits the well-to-do. A 2022 study by Lawrence Berkeley Labs showed that 60% of all solar users in California then were actually low- to middle-income residents. In addition, claiming that residential solar power is significantly responsible for driving the state’s electricity rates up just isn’t true either. Those rates have largely risen because of the eternal desire of California’s utility companies to turn a profit.
Here’s an example of how those rates work and why they’ve gone up. Pacific Gas & Electric Company (PG&E), whose downed power lines have been responsible for an estimated 30 major wildfires in California over the past six overheating years, was forced to pay $13.9 billion in settlement money for the damage done. The company has also been found guilty of 84 felony counts of involuntary manslaughter for deaths in the devastating 2018 Camp Fire in Butte County. In response to those horrific blazes and the damages they inflicted, the company claims it must now spend more than $5.9 billion to bury its aging infrastructure to avoid future wildfires in our tinder-box of a world. Watchdog groups suggest that it’s those investments that are raising electric bills across the state, not newly installed solar power.
In short, large utilities make their money by repairing and expanding the energy grid. Residential solar directly threatens that revenue stream because it doesn’t rely on an ever-expanding network of power stations and transmission lines. The electricity that residential solar power produces typically remains at the community level or, better yet, in the home itself, especially if coupled with local battery storage. Not surprisingly then, by 2018, 20 transmission lines had been canceled in California, mainly because so many homes were already producing solar power on their own rooftops, saving $2.6 billion in total consumer energy costs.
A recent Colorado-based Vibrant Clean Energy analysis confirmed the savings rooftop solar provides to ratepayers. Their report estimated that, by 2050, rooftop panels would save California ratepayers $120 billion. That would also save energy companies from spending far more money on the grid (but, of course, that’s the only way they turn a profit).
“What our model finds is that when you account for the costs associated with distribution grid infrastructure, distributed energy resources can produce a pathway that is lower cost for all ratepayers and emits fewer greenhouse gas emissions,” said Dr. Christopher Clack of Vibrant Clean Energy. “Our study shows this is true even as California looks to electrify other energy sectors like transportation.”
However, such lower costs also mean less profits for utility companies, so they have found an ingenious workaround. They could appease climate concerns while making a bundle of money by building large solar farms in the desert. In the process, nothing about how they generated revenue would change, energy costs would continue to rise, and little would stand in their way, not even a vulnerable forest of Joshua trees.
Solar Panels vs. the Joshua Tree
“Why Razing Joshua Trees for Solar Farms Isn’t Always Crazy,” a troubling Los Angeles Times headline read. Sammy Roth, an intrepid environmental reporter who has written insightfully and cogently on the way humanity is altering the climate, was nonetheless all in on uprooting thousands of Joshua trees in California’s Kern County to make space for that giant solar farm. The “Aratina Solar Project,” a sprawling 2,300-acre installation in the heart of the Mojave Desert, would transfer electricity to wealthy coastal areas, powering more than 180,000 homes. As Roth reported, “There are places to build solar projects besides pristine ecosystems. But there’s no get-out-of-climate-change-free card… Hence the need to accept killing some Joshua trees in the name of saving more Joshua trees. I feel kind of terrible saying that.”
He should feel terrible. Roth believes that tearing up Joshua trees, already in great jeopardy due to our warming climate, is the price that must be paid to save ourselves from ourselves. But is sacrificing wild spaces—and, in this case, also threatening the habitat of the desert tortoise—truly worth it? Is this really the best solution we can come up with in our overheating world? There do appear to be better options, but they would also upend the status quo and put far less money in the pockets of utility shareholders.
Just three big box stores in California cities ripe for solar power would provide more acreage than the 2,300-acre Joshua-tree-destroying solar installation in Kern County.
Here’s how Californians could think outside the box or, in this case, on top of it. A single Walmart roof averages 180,000 square feet. In California, there are 309 Walmarts. That’s 55,620,000 square feet or 1,276 acres of rooftop. Home Depots? There are 247 of them in California and each of their roofs averages 104,000 square feet, totaling 25,668,000 square feet, or around 589 acres. Throw in 318 Target stores, averaging 125,000 square feet, and you have over 39,750,000 square feet or another 912 acres. Add all of those up and you have 2,777 acres of rooftops that could be turned into mini-solar farms.
In other words, just three big box stores in California cities ripe for solar power would provide more acreage than the 2,300-acre Joshua-tree-destroying solar installation in Kern County. And that doesn’t even include all the Costcos (129), Lowes (111), Amazon warehouses (100+), Ikeas (8), strip malls, schools, municipal buildings, parking lots, and so much more that would provide far better options.
You get the picture. The potential for solar in our built environment is indeed enormous. Throw in the more than 5.6 million single-family homes in California with no solar panels, and there’s just so much rooftop real estate that could generate electricity without wrecking entire ecosystems already facing a frighteningly hot future.
In 2014, it was estimated that solar power from California homes produced 2.2 gigawatts of energy. Ten years later, that potential is so much greater. As of summer 2024, the state has 1.9 million residential rooftop solar installations capable of churning out 16.7 gigawatts of power. It’s estimated that 1 gigawatt can conservatively power 750,000 homes. This means that the solar generation now installed on California’s roofs could theoretically, if stored, power 12,525,000 homes in a state with only 7.5 million of them. Already, in 2022, it’s believed that the state wasted nearly 2.3 million megawatt-hours worth of solar-produced electricity.
And mind you, this isn’t just back-of-the-napkin math. A 2021 geospatial analysis of rooftop solar conducted by researchers at Ireland’s University of Cork and published in Nature confirmed what many experts have long believed: that the U.S. has enough usable rooftop space to supply the entire country’s energy demands and, with proper community-based storage, would be all we would need to fulfill our energy production demands—and then some! If properly deployed, the U.S. could produce 4.2 petawatt-hours per year of rooftop solar electricity, more than the country consumes today. (A petawatt-hour is a unit of energy equal to one trillion kilowatt-hours.) The report also noted that there are enough rooftops worldwide to potentially fully feed the world’s energy appetite.
If residential solar has succeeded exceptionally well and has so much possibility, why are we intent on destroying desert ecology with massive, industrial-scale solar farms? The answer in Gavin Newsom’s California has much more to do with politics and corporate avarice than with mitigating climate change.
Profit-Driven Utilities
Despite what Gov. Newsom and the California Public Utilities Commission have claimed, electric rates have increased not because of solar power’s massive success but because of old-school capitalist greed.
“Rooftop solar has value in avoiding costs that utilities would have to pay to deliver that same kilowatt-hour of energy, such as investments in transmission lines and other grid infrastructure,” reports the solar-advocacy group, Solar Rights Alliance. “Rooftop solar also reduces the public health costs of fossil fuel power plants and the costs to ratepayers of utility-caused wildfires and power shut-offs. Rooftop solar also provides quantifiable benefits through local economic development and jobs. It preserves land that would otherwise be used for large-scale solar development. When paired with batteries, rooftop solar helps build community resilience.”
Nonetheless, blaming rooftop solar for California’s increased electricity rates has been a painfully effective argument. So, here’s a question to consider: Why does it seem like Newsom is working on behalf of the utilities to limit small-scale rooftop solar? Could it be related to the $10 million Pacific Gas & Electric donated to his campaigns since he first ran for office in San Francisco in the late 1990s? Or could it be because key members of his cabinet are tight with PG&E executives? (Dana Williamson, his current chief of staff, was a former director of public affairs at PG&E.)
Growth means more money for California’s utilities, so they’ve gone all in on expansive and destructive solar farms.
Then, consider the potential conflict of interest when the law firm O’Melveny & Myers, which previously worked for PG&E, was tasked by Newsom with drafting wildfire legislation to save the company from bankruptcy. PG&E would, in fact, end up hammering out a deal with CPUC to pass on the costs of the bailout, a staggering $11 billion, to ratepayers over a 30-year period.
It all worked out well for the company. In 2023, PG&E, which serves 16 million people, raked in $2.2 billion in profits, nearly a 25% jump from 2022.
“The coziness between Gavin Newsom and [PG&E] is unlike anything we’ve seen in California politics… Their motive is profit, which is driven by Wall Street,” says Bernadette Del Chiaro, executive director of California Solar & Storage Association, who has over a decade of experience monitoring the industry. “[The utility companies] have to keep posting record profits, quarter after quarter. It’s a perversity that nobody is really thinking about.”
It’s pretty simple really. Growth means more money for California’s utilities, so they’ve gone all in on expansive and destructive solar farms. Ultimately, this means higher bills for consumers to cover the costs of a grid they are forced to rely on as home solar systems become increasingly expensive.
(More) Bad News for the Climate
Newsom’s war on rooftop solar has had another detrimental impact: It’s threatened the state’s clean energy goals. And the governor hasn’t said a word about that. The California Energy Commission estimates that, to meet its climate benchmarks, the state must add 20,000 megawatts of rooftop solar electricity by 2030. At this pace, they’ll be lucky to install 10,000 megawatts. With such a precipitous decline in home solar installations, the 20,000 megawatts goal will never be reached by that year, even when you include all large-scale solar developments now in the works.
The Coalition for Community Solar Access estimates that 81% of solar companies in the state fear they’ll have to close up shop. Bad news for the solar industry also means bad news not just for California, the nation’s leader in solar energy production, but for the climate more generally.
The slow death of new residential solar installations is likely to mean that most of California’s electricity will continue to be made by burning natural gas and sending more fossil fuel emissions into the atmosphere.
A rapid decline in new solar installations also means massive job losses, possibly 22% of the state’s solar gigs, or up to 17,000 workers. In addition to such bleak projections, disincentivizing rooftop solar will also hurt the Californians most impacted by warming temperatures and in need of relief—those who can’t afford to live along the state’s more temperate coast.
“Rooftop solar is not just the wealthy homeowners anymore,” State Senator Josh Becker, a San Mateo Democrat, recently toldCalMatters. “Central Valley people are suffering from extreme heat. The industry has been making great strides in low-income communities. This [utilities commission decision] makes it harder.”
The slow death of new residential solar installations is likely to mean that most of California’s electricity will continue to be made by burning natural gas and sending more fossil fuel emissions into the atmosphere. All of this may also be a sign that rooftop solar across the country is in peril. Utility companies and those hoping to gut residential solar programs in Arkansas, Florida, Georgia, Nevada, and North Carolina are already humming Newsom’s “cost-shift” tune.
“They [the big utilities] know it’s a pivotal time,” Bernadette Del Chiaro tells me, with a sense of urgency and deep concern for what lies ahead. “They are fighting really hard, and they are fighting hardest in California because where California goes, there goes the nation.”
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