SAN FRANCISCO – California utility regulators violated state law by approving policy changes pushed by monopoly utilities that severely throttled a once-thriving rooftop solar market, the Environmental Working Group and its allies claim in a new legal filing.
The November 21 filing, in the California Court of Appeal, makes the case for how the California Public Utilities Commission, or CPUC, “failed to proceed in a manner required by law” in approving the policy changes. EWG filed the brief along with the Center for Biological Diversity and the Protect Our Communities Foundation.
The brief says that, following a recent Supreme Court ruling, the appeals court must now independently interpret statutes that direct CPUC actions and determine whether the commission failed to proceed as the law requires.
This means the court must apply its independent judgment “de novo” to determine the meaning of the Legislature’s express statutory directives, the filing says. The court must then determine whether the CPUC followed those directives, and not simply give a “strong presumption” of validity to the CPUC’s decisions, as has happened in the past. “Those freewheeling days are over,” the brief says.
The filing is the latest salvo in a long-running legal battle that could greatly influence the future growth of rooftop solar in California.
“To put it simply, the CPUC flouted and subverted the law in their 2022 decision to disastrous effect,” said Bernadette Del Chiaro, EWG’s senior vice president for California. “As a result, consumers have fewer choices for getting out from underneath rising electricity bills and California is falling further behind its clean energy goals.”
The state attorney general, on behalf of the CPUC, and the state’s three investor-owned monopoly utilities – Pacific Gas & Electric Company, Southern California Edison and San Diego Gas & Electric – also filed briefs November 21. They defended the CPUC’s actions.
History of solar lawsuit
The state’s rooftop solar program was once thriving. It helped slash consumers’ electricity bills that are already some of the highest in the U.S., lower costs for new energy technologies, and help drive the state’s clean energy goals. The program gave consumers, mostly low- and middle-class families, an alternative and more affordable way to power their air conditioners and other electronic devices while reducing strain on the electric grid. The program also helped reduce the state’s reliance on environmentally harmful forms of power.
But the CPUC’s 2022 decision severely damaged the program, making rooftop solar more expensive for consumers and triggering a sharp drop in installations. This led to tens of thousands of solar worker layoffs and widespread solar company bankruptcies. It also knocked the state off its path toward 100% clean energy. All this, the brief filed by EWG and its allies declares, happened in violation of state law.
“The utilities don’t like this program because it hurts their bottom line,” explained Del Chiaro. “They see rooftop solar as their biggest competitive threat and want to halt its growth, using the CPUC to achieve that end.”
The CPUC mostly rubber stamps whatever the utilities want, even if it hurts ratepayers’ pocketbooks. And it greenlighted the companies’ push for dismantling the solar program.
EWG and its allies challenged the 2022 “NEM 3.0” decision through the regulatory process but the CPUC rejected it in 2023. The groups then sued in the California Court of Appeal. The appellate court sided with the CPUC and the investor-owned utilities, basing their decision on an outdated legal precedent that gave the Commission broad deference. EWG and its allies appealed to the California Supreme Court in 2024, arguing that the lower court used the wrong standard of review and gave the CPUC too much deference.
The Supreme Court justices in August 2025 agreed with EWG and its allies that the proper standard of review is a much stricter one, set by the California Legislature in 1998. The Supreme Court overturned the Court of Appeal’s decision, sending the case back for a fresh review.
Note: Del Chiaro is available for interviews upon request.
###
The Environmental Working Group (EWG) is a nonprofit, non-partisan organization that empowers people to live healthier lives in a healthier environment. Through research, advocacy and unique education tools, EWG drives consumer choice and civic action.
