Nevada and Hawaii are two states that have taken different, though both scaled-back, approaches to rooftop solar. But the good news for solar advocates is that both states appear to be making progress, for different reasons.
First, Hawaii. The Aloha State retrenched from the generous net metering retail rate compensation last year. Instead, state regulators pushed a hybrid option that allows customers to either take a wholesale rate for all power they export or get a retail credit for all the power they use on-site (but not for any exports, which are not credited).
And in a positive development, the new rates are actually leading to enough customer demand that the state may soon reach its cap on new enrollees. As Utility Dive reports, the cap may be met as soon as next month. What that means is that the economics of the reduced incentives are still working for many customers, and it also gives them an incentive to buy a battery, if they go with the retail rate (in order to maximize their on-site usage).
Granted, Hawaii uniquely has ridiculously high electricity rates and tremendous solar exposure, making it not exactly representative. Still, it shows that the economics of reduced incentives can still work, once the price of the panels comes down (or the price of electricity increases).
Meanwhile, over in Nevada, the state gutted its solar incentives, even going back on its deal with existing customers, leading to stranded assets and betrayed buyers. But now an electoral push may reverse this decision by voter initiative. The utility is fighting back, per the Las Vegas Review-Journal, but so are solar companies. And there are murmurs that the governor is willing to hash out a deal with the solar companies.
My guess is that Nevada will end up with a compromise, perhaps along the lines of the Hawaii path. And in the long run, we know the current generous net metering incentives won’t last forever. So a future that still encourages deployment and also on-site storage in the form of batteries would be a good one.
In the very long term, rooftop generation may not be the best way forward anyway, particularly given that many people don’t have a rooftop with sun exposure or lack sole access to theirs. So we should be simultaneously encouraging more community solar and microgrids as the best way to decarbonize and localize our electricity systems, leading to greater reliability and cheaper prices in the process.
Sunbelt cities across America are investing in rail and transforming themselves from car-dominated regions to urban railtowns. I cover the story in Los Angeles extensively in Railtown, but the same trends are evident in cities like Charlotte, Denver, and Phoenix.
Yesterday I spoke about this phenomena with host Dan Loney on SiriusXM radio’s Knowledge@Wharton, a business-themed program out of the Wharton School at the University of Pennsylvania. You can listen here to the first five-minutes of the segment, which otherwise ran for 30 minutes:
If you have a SiriusXM subscription, the full show is available via the “On Demand” feature for the next seven days, on channel 111. And if you don’t have a subscription, you can start a 30-day free trial here.
Governor Brown’s proposal in his new budget to make certain housing developments eligible to be approved by the state “by right” has riled up not just local governments — who stand to lose discretionary approval over these projects — but some labor and environmental groups as well.
It’s pretty obvious why these groups are upset: the by-right state approval means they lose their leverage over projects under the California Environmental Quality Act (CEQA), which can trigger lengthy local environmental review for discretionary approvals. And the governor’s proposal, as currently written, lacks safeguards to ensure that only environmentally beneficial projects are eligible for state approval.
Yet local resistance to new housing is a problem well beyond CEQA, and its cumulative effect — through restrictive local zoning, discretionary rejection of new housing, and citizen petitions and lobbying — has created a massive housing shortage in the state’s big cities. The inevitable result is high housing costs squeezing middle-income earners, with displacement and gentrification pushing out low-income earners. It’s becoming a national drag on our economy, while pushing new development out to the exurbs and over open space and farmland.
So in principle, state approval of certain housing projects is justified. But it needs to be the right kind of housing development, consistent with existing local plans. A relatively straightforward condition on these projects to be eligible is that they are located within a half-mile of a major transit stop and meet certain vehicle miles traveled (VMT) and greenhouse gas emission profiles. That would ensure environmental performance and that the projects do not contribute to sprawl.
The basic formula would be: 1/2 mile + VMT + GHG = by-right approval.
Of course, you’d probably have to layer in an affordable housing requirement as well to achieve political consensus. But increasing supply today will go a long way to stabilizing prices and therefore minimizing displacement, as well as creating the housing stock that will one day be affordable to low-income earners. And in the meantime, we can ensure that these new projects contain affordable units.
And for the labor groups, these multi-unit housing developments typically require higher-paying, high-skilled jobs that pay better than sprawl construction.
It would be a win-win, if our political leaders and advocates can arrive at compromise.
California’s big cities, from San Francisco to Los Angeles, have been struggling to contain spiraling housing costs, leading to an economic squeeze on the middle class, gentrification and displacement of low-income areas, and overall income inequality.
The debates that have raged in response, however, have been largely untethered from common and accepted data about what is actually causing the increases. Affordable housing advocates want limits on new development and more subsidies for low-income housing, arguing that adding to the supply will simply encourage more displacement. Renter advocates meanwhile want more construction overall to boost the supply and stabilize prices for everyone.
In an impressive display of independent scholarship, Eric Fischer at the blog Experimental Geography stepped into this data void. After pouring over apartment ads in the City of San Francisco since the 1940s, as well as other economic data, he figured out how to predict rents in the city in any given year.
The bottom line: the three big factors are jobs, salaries, and housing supply:
[I]t is possible to model year-over-year change in rent in terms of year-over-year change in employment, wages, and housing construction. In this case the best fit says that a 1% increase in employment means a 0.95% increase in rent, a 1% increase in wages means a 1.74% increase in rent, and a 1% increase in the housing stock means a 1.7% decrease in rent. It’s the same basic idea, but the magnitudes are different. I don’t know if it is any more correct than the first model, or if they are both bouncing around within the same uncertainty.
Basically, it boils down to the economy and available housing stock. So if we want to dramatically decrease housing prices to make the city more affordable to a wider range of income groups, here is what Fischer suggests:
Can we roll the clock back 35 years, to when the CPI-adjusted median rent was approximately one third what it is now?
It will be very hard. If the (first) model is correct, it would take a 53% increase in the housing supply (200,000 new units), or an 44% drop in CPI-adjusted salaries, or an 51% drop in employment, to cut prices by two thirds. A steep drop in salaries or employment would also be devastating to the ability of people to afford the new lower prices. It is enough to make you believe Randal O’Toole that affordability can only be achieved by continued outgrowth, as San Francisco could do in the early 1950s.
200,000 new units is an incredibly tall order, given the land constraints and certainly the political opposition to densifying the city at that scale (Fischer describes this concern as relating to “visual stability” of the city). As a result, achieving rent decreases in San Francisco is probably off the table. But rent stability is still achievable. As Fischer assesses:
Therefore, if price stability is the goal, the city and its citizens should try to increase the housing supply by an average of 1.5% per year (which is about 3.75 times the general rate since 1975, and with the current inventory would mean 5700 units per year). If visual stability is the goal instead, prices will probably continue to rise uncontrollably.
Fischer’s work is a big contribution to the debate and ultimately reinforces the notion that improving housing supply is our best bet for stabilizing rents. But his study does not address the regional forces at work. San Francisco is a kind of island, stuck at the top of a peninsula. So what would the impact be of increasing housing supply across the bay in Oakland, Berkeley, and San Rafael, and then down the peninsula in Silicon Valley? If those areas boosted supply at a significant clip, would that have a similar effect in San Francisco of building those 200,000 additional units within the city?
It would be a helpful next step for this research. But in the meantime, we now finally have a good sense of how much price increases are due to the economy and how much due to supply. For that, we can thank Fischer — and hope that he continues on this research path.
The groundbreaking ceremony for the just-opened Expo Line light rail to Santa Monica took place back on September 29, 2006. I was there and got this cool mini shovel memorabilia to honor the occasion:
That means that the opening of the full line to Santa Monica on Friday happened just under 10 years after groundbreaking. For those keeping score at home, that means the Expo Line Construction Authority managed to build 1.5 miles of rail each year.
As far as rail lines go, this should not have been a very complicated construction job. The line runs virtually entirely at-grade, with minimal trenching and a handfull of overpasses. In addition, the right-of-way already existed and therefore required relatively little property acquisition and condemnation.
In short, the amount of time spent to build this line seems absurd. That’s not even counting the years of planning. And yet the region’s leaders apparently aren’t upset by it or demand any better.
Sadly, at this point, Californians have just gotten used to these interminable construction timetables. High speed rail is way behind schedule and won’t open until probably the 2040s or 2050s, if at all. The Purple Line subway extension down Wilshire most likely won’t be operational until the 2030s. Even automobile projects like the San Francisco Bay Bridge eastern span took over a decade to open.
It’s a subject I tackled for UCLA Law in 2014, with the report Back in the Fast Lane, and an op-ed in the San Francisco Chronicle. Yet I’ve seen little interest among policy makers (or even the public) to tackle this issue. Why the complacency?
For those who care about boosting transit, they have an interest in getting ahead of this problem. A few bad headlines can undermine political support for transit investments, especially in California where advocates need two-thirds voter approval for tax measures. And it also means we’re getting much less bang for our buck on these projects, which means fewer projects that benefit people.
It’s enough to make me mad. Or maybe it will later. At some point anyway.
For yesterday’s celebrations around the unveiling of the Expo light rail line to Santa Monica from downtown L.A., I had an opportunity to do an extended interview on the politics of the line with KCRW’s Saul Gonzalez. You can listen to the audio here.
So what’s next? Here’s what I’ll be looking for in the months (and years) to come:
- Long travel times: will people be frustrated by the nearly hour end-to-end ride from downtown Santa Monica to downtown L.A.? Current time projections are 50 minutes, which is a long time for a ride that can take 15 minutes by car with no traffic. The LA Weekly and Los Angeles Times have done a good job of flagging this issue. There are no easy solutions, but at a minimum the City of L.A.’s transportation department should give the trains signal priority so they don’t stop at red lights downtown. Meanwhile, Metro should consider skipping under-performing stations, at least temporarily.
- Collisions: with the train running most at-grade (i.e. street level) and going through some funky intersections from the old railroad right-of-way, will the line experience a lot of accidents like the similarly situated Blue Line, one of the deadliest in the country? And what will the political response be? Easy solutions would be more crossing gates to block traffic, including for those driving in the wrong lane who try to get around single-lane crossing gates (it happens).
- The Expo bike lane: part of the rail extension includes a badly needed dedicated bike path. There’s a gap in the route though, apparently due to neighborhood opposition (what’s new). But the conditions are ripe to make this path even more successful, on a per traveler cost basis, than possibly the rail line next to it. The route is largely flat, the weather is great, and biking is super convenient. So this may be the unsung hero in the whole project.
Transit-oriented development along the route: the whole point of rail lines is really about economic development and land use, as Politico covered in an excellent profile on Denver’s burgeoning rail network. Right now, the route covers a lot of relatively low-density areas, and Santa Monica infamously shot down an office and housing project (see rendering) next to one of the new stations, resulting in a low-rise suburban office park to take its place. Will the cities along the route allow new development near the stations? If not, the line will be doomed to under-performance.
- Changing the politics of rail in Los Angeles: with rail now serving a highly visible, major job center in the region, will its existence solidify rail as a politically entrenched force? A bus activist in the Bay Area once told me that nobody would ever scale back BART in favor of buses now, because “BART is too precious.” Will the same thing happen to Metro Rail? As the system begins hauling more people and possibly taking a central role in economic development (subject to #4 above), it may lock in ongoing voter support for the foreseeable future. And not just in the westside. After all, with the eastern county Gold Lines operating, many of those residents will have a stake in accessing jobs in the western part of the county, too.
I’m sure other issues will arise as the system matures, and I’ll try to follow them on this blog. But for now, something to consider as many westside workers and residents of Los Angeles finally get their day to ride the rails.
Los Angeles is about to unveil one of the most consequential transportation projects in recent history. I don’t want to get too hyperbolic, but the coming of the Expo Line light rail transit tomorrow to Santa Monica is, as our current vice president might say, a big f***** deal.
The reason for the import is twofold: first, the location. The westside of Los Angeles County is the most densely populated in the region and the most traffic-choked. Expo, running from downtown Los Angeles all the way to the beach, will finally open that area up to the rest of the train network that’s been growing in fits and starts since 1990. That means a good ridership boost for the whole system and a major alternative to driving for many westside residents and workers.
Second, and more intangibly, the train will now serve an influential part of the population, who will finally be seeing a train in their backyard, and a highly visible location for tourists and Angelenos alike.
Some of the most wealthy and powerful people in Los Angeles, from business to media to opinion leaders, reside in the westside. They are the ones who set much of the tone for the region in its popular discourse and are key to much of its politics and private investment, particularly during a time of tremendous income inequality. As opinion shapers, it matters if they complain about LA “not having any transit” (leaving aside the comprehensive bus network), so a train in their backyard undermines that claim.
In addition, with trains running through the streets of Santa Monica and along Interstate 10, this line will be a visible symbol of the ongoing transformation in Los Angeles’s housing patterns, transportation options, and self-image. Some of the most powerful people in the region will be seeing it firsthand, as well as the legions of tourists from around the world (and the region) who visit downtown Santa Monica and nearby areas.
Ultimately, actions and investment matter more than symbols, and the everyday county voter has certainly been the key to funding these investments. But images and impacts are mutually reinforcing, and the symbolism of Expo — as much as the ridership boost and potential for neighborhood development along the corridor — may matter just as much in the long run.
All in all, it makes tomorrow a momentous day in the history, and future, of transportation and development in Los Angeles.
With the opening of the Expo Line to Santa Monica later this week, KPCC radio is giving this momentous occasion some comprehensive coverage. Transportation reporter Meghan McCarty interviewed me and others about the significance — and potential challenges — of the line. Here is an excerpt:
Elkind said the county needs to brings more people closer to the train line.
“The best thing you can do is put affordable housing – that type of investment is really critical to create that type of thriving, compact neighborhood,” he said.
More buildings could be a tough sell on the Westside, where development is a hot button issue. Both in Santa Monica and Los Angeles, voter-led efforts to limit new buildings have drawn tens of thousands of signatures in support. Fears of increased traffic and loss of neighborhood character have driven the anti-development sentiment.
I’ll have more thoughts on both the upsides and areas of concern for the new line soon.
Capitol Weekly in Sacramento yesterday ran an op-ed from me and Jim Strittholt of Conservation Biology Institute on our recent solar PV mapping effort. Highlight passage:
When we combined the separate maps, the result was pretty remarkable: Out of the 9.5 million acres in the stakeholder study area, the groups identified 470,000 acres of ideal, non-controversial land for solar PV development, or roughly 5 percent of the Valley study area. At a generic calculation of 1 megawatt of solar PV production from 5 acres of panels, that means the lands identified could provide 94,000 megawatts of renewable power – greater than all combined in-state generation capacity and enough to power as many as 23 million homes in California with low-cost, clean electricity. And that’s just from the San Joaquin Valley.