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Hector Barreto: California PUC solar decision will hurt small business

Hector Barreto, former Administrator of the U.S. Small Business Administration under President George W. Bush, is chair of the Latino Coalition.
Hector Barreto, former Administrator of the U.S. Small Business Administration under President George W. Bush, is chair of the Latino Coalition. PHOTOFORMULA.com

While California is known as the world’s leader in technology and entertainment, the true heartbeat of our state’s diverse economy is the millions of small business owners. From food service to health care, they are the risk-takers and job creators, and they make up over 90 percent of our state’s employers.

Best of all, we are one of the nation’s leaders in minority-owned businesses, and that is a reflection of the ethnic and racial melting pot that has made California the envy of the world.

To succeed in any small business, you must not only sell a great product or a great service, you must also control costs. Every expense matters, and the last thing we want to burden any small business entrepreneur with is unfair costs.

Which leads us to raise real concerns over the preliminary Net Energy Metering reform decision by the state Public Utilities Commission that, if it stands, would shift over a billion dollars in costs not only to nonsolar customers, but also to many minority and nonminority small business owners.

While it may not seem that the contentious debate over how California subsidizes solar energy would matter to minority small business owners, the truth is that it does. It matters now, and it will matter even more in the years to come.

A PUC study, for example, has estimated that nonsolar customers could bear as much as a billion dollars in additional costs by 2020. Many small businesses lease their space, and they pay directly for their energy use. Going solar is simply not an option, and it is inexplicable why the PUC did not factor in the financial burden this decision would have on our state’s minority-owned small businesses.

Some may suggest that raising these concerns implies we are somehow attacking solar or clean energy. Nothing could be further from the truth. We applaud those who choose to go solar. Making our state greener and cleaner is an admirable goal that we should strive for every day. Yet, it makes no sense to add an additional economic burden on small business owners who must watch every penny to survive simply to benefit a thriving solar industry.

Real and fair Net Energy Metering reform should balance the costs so that we all benefit from the future growth of solar. Even more importantly, smarter reform would protect solar and nonsolar customers alike, and would ensure that the financial rewards do not go to a multibillion-dollar solar industry or banks that finance solar purchases.

Unfortunately, instead of balanced reform, the initial PUC decision reaffirmed policies that will simply perpetuate a status quo that will hurt our state’s minority small business owners.

We urge the PUC to reconsider its preliminary decision, and to support more balanced reform that avoids dividing our state’s solar and nonsolar customers, or threatens the very heart of our state’s economy – our small businesses.

We know the PUC can do better, and we call on them to embrace real reform before needless damage is done to our state’s clean energy and economic future.

Hector Barreto is chairman of The Latino Coalition and the former U.S. Small Business Administrator 2001-2006.