State regulators on Thursday approved a proposal from Southern California Edison to install, own and operate rooftop solar panels capable of generating 250 megawatts of power within its service territory.

The approval marks the first time a California utility will own a significant renewable energy source.

But in a move that upset ratepayer advocates, the California Public Utilities Commission also voted to double the size of the program, allowing for independent solar providers to own and operate rooftop solar panels that can generate another 250 megawatts.

Together, these programs would generate up to 500 megawatts of power, some of which would be used by the buildings below the rooftops and the rest routed to the local transmission grid. A megawatt can power up to 700 homes during peak usage.

"This decision is a major step forward in diversifying the mix of renewable resources in California and spurring the development of a new market niche for rooftop solar applications," said PUC Commissioner John Bohn. "These projects can get built quickly and without the need for expensive new transmission lines."

But the PUC's Division of Ratepayer Advocates protested the approval. The organization said the program lacks protections against cost overruns and performance guarantees that were in the original proposal from PUC staff.

With a lack of those ratepayer protections, doubling the size of the program could end up costing ratepayers up to $2 billion, the division said in a statement.

"The decision approved today stripped these protections out, leaving the ratepayers in Southern California at risk of being on the hook for infrastructure costs that do not produce the benefits claimed by SCE," said Division of Ratepayer Advocates Director Dana Appling.

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