@nwdiver: I understand how the utility and your utility commission could talk themselves into why this is sensible, but I agree that the outcome is absurd.
Here's what I think they did to justify the charges:
Most U.S. residents live in an organized power market, where the value of power and the value of capacity are determined, not by the utility, but by market forces. In these markets, solar has capacity value, and its energy injection could be valued at hourly prices, reflecting actual market replacement costs. The financial outcome would be far better than the "deal" Excel is foisting on you.
Here's what I think they did to justify the charges:
- Excel's capital cost for generation is a fixed cost that is allocated to various customer classes based on some billing determinant. For residential customers, the fixed cost is allocated /kWh. Specifically, that's the $0.0366/kWh.
- Excel would make the case that, because you have the right to call for grid power any time and because solar is unreliable, there is no savings created to this capital cost from your DG. Hence, you should be charged the non-fuel portion of the generation charge.
- Regarding what they pay you, they probably argue that they should only pay the avoided fuel cost at their plants, which they've computed at $0.030 to $0.033/kWh (depending on time of day? Not sure why there are two lines on your bill.)
Most U.S. residents live in an organized power market, where the value of power and the value of capacity are determined, not by the utility, but by market forces. In these markets, solar has capacity value, and its energy injection could be valued at hourly prices, reflecting actual market replacement costs. The financial outcome would be far better than the "deal" Excel is foisting on you.
