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As rooftop solar costs drop, utility attempts to raise barriers may not work
- Thread starter 997cab
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- Energy Environment Policy
There are many issues that need to be worked out, and they're not as black and white as the internet articles make them out to be. I work for the local utility and have a solar PV system myself, so I understand both sides of the fence...At least in our service territory, the utility doesn't make any money from selling electricity (it is a pass-through cost). The utility makes money via a rate of return for building large capital projects (as approved by the CPUC). So what I'm seeing is not a fear of more solar being installed (in fact, contrary to popular opinion, our utility is actually pro-solar and has done many things to support solar), but the questions that are being debated are how to fairly collect the various costs that it takes to run the utility.
Here are just a few examples of things that are in need of a better solution...
The utility gives me a 46 cent credit for power generated in the summer season from noon to 6pm, because I'm on the EV time of use rate. When my excess power flows out to the grid, it is most likely being sold to other nearby customers for less than 46 cents. All ratepayers absorb this negative cash flow.
In the daytime, I export excess solar to the grid and get credit for it, and then at night I buy power for cheaper rates (which is when I charge my car)...I am essentially using the grid as a personal storage battery and there is no charge for that (other than the minimum monthly charge of $10 that could be me purchasing electricity for $10 or it could be me paying $10 as a minimum fee if I am a net overgenerator and don't buy $10 worth of electricity). The grid costs much more than $10 monthly per customer, and that difference is being paid for by all ratepayers...
The CPUC has approved various programs that we collect funds from all ratepayers to implement, such as low income rates as well as other items...Solar PV owners that are grandfathered on the original NEM program and are overgenerators don't pay any of those fees because their bill is close to zero or slightly negative. So people that can afford to put in solar are able to exempt themselves from these CPUC-mandated fees.
There are more things, but these are just a few...
Solar is here to stay, no question, so these issues need to get figured out...Fun times ahead....
Here are just a few examples of things that are in need of a better solution...
The utility gives me a 46 cent credit for power generated in the summer season from noon to 6pm, because I'm on the EV time of use rate. When my excess power flows out to the grid, it is most likely being sold to other nearby customers for less than 46 cents. All ratepayers absorb this negative cash flow.
In the daytime, I export excess solar to the grid and get credit for it, and then at night I buy power for cheaper rates (which is when I charge my car)...I am essentially using the grid as a personal storage battery and there is no charge for that (other than the minimum monthly charge of $10 that could be me purchasing electricity for $10 or it could be me paying $10 as a minimum fee if I am a net overgenerator and don't buy $10 worth of electricity). The grid costs much more than $10 monthly per customer, and that difference is being paid for by all ratepayers...
The CPUC has approved various programs that we collect funds from all ratepayers to implement, such as low income rates as well as other items...Solar PV owners that are grandfathered on the original NEM program and are overgenerators don't pay any of those fees because their bill is close to zero or slightly negative. So people that can afford to put in solar are able to exempt themselves from these CPUC-mandated fees.
There are more things, but these are just a few...
Solar is here to stay, no question, so these issues need to get figured out...Fun times ahead....
Is this then one of those - and if not, why not? - situations where the easiest path for the utility to increase its profits is to redecorate the boss's office?
Guaranteed rate of return on a project is a despicable, irredeemably evil misuse of the power granted to natural monopolies. It's a shame my limited vocabulary cannot come up with more appropriate terms for it.
nwdiver
Well-Known Member
Yep... my wonderful utility just spent $2B on a bet that oil rebounds... they're already trying to charge me more for my solar production to help pay for it. We need a new paradigm... BAD.
Off Shore
Off Topic Member
Great post, RandyS. Thanks! I agree it's important to remember that we're in a very fast-moving scenario, and something that makes sense today won't tomorrow. As an example, net metering is a way to encourage adoption of solar. When we all have solar on our roofs (thanks, EM) the net metering model won't work, and we'll have to do something else. When we all have batteries on our walls, the model will have to change again. Also, your utility doesn't have to make money. On my other island (the one with the Tesla) a group of us are working to have the municipality buy the grid from our foreign-owned incumbent and pump through (slightly) cheaper and (extremely) cleaner energy from a regional federal project, joining the 66 other public power utilities in the state.
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