Philosophical questions that highlight how absurd a fee on self-generation is.

[rolosrevenge]

If the DOT started delivering packages and charging UPS and Fedex onerous fees (not simply usage fees) intended to place them at a disadvantage I'm pretty sure most people would see that as wrong. The solution wouldn't be for UPS and Fedex to stop using roads... the solution here is not to go off-grid. Time to fix the system.

It's called the USPS, and they do prohibit UPS and FedEx from using mail boxes.

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Where's the logic in charging me for a kWh that comes off my array and gets consumed immediately on my side of the meter? If I were to bypass that meter to charge my car am I stealing? If I were to use my solar panels when the grid is down should I pay the utility for that? It's absurd.

If the grid based rates are bundled into your cost per kWh, and you use your own kWh while still being connected to the grid, then your grid connection is being subsidized. The fee makes sure you pay your fair share. A far better way would be to decouple all grid costs from energy costs and bill people on what they use and for the connection. But don't expect for them to pay the same rate for your solar as you pay for the energy, because your energy comes with all of the ancillary services attached to it that your solar cannot provide. Plus you would be using their wire to deliver your product, so you'd need to pay a wheeling tariff on each kWh sold outside. It stings I know, but that's why the power grid drifted towards a natural monopoly because economies of scale win out.

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Seems to me that if they want to charge a 'generation' fee to self-generators for the use of the grid, that same fee should be applied to all generators. .

Any non-utility owned generators do pay generation fees. They pay connection fees, they pay wheeling tariffs to anyone who owns wires in between them and their contracted customer. Residential solar has been ignoring these for a while, but as the penetration increases, they need to behave like any other independent power producer. It stings for the people who enjoyed their fat subsidies, but the system needs to be sustainable.

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It IS absurd. If there is a grid cost, then determine that value and add it to the incoming power and charge it to the exported power. Essentially taxing all the power you produce, whether you export it or not, seems entirely unreasonable.

Nope, because when you self produce while still connected to the grid, you are shirking your fair share of the grid fees. The mistake was bundling grid costs into energy costs based on your yearly, presolar usage, but by that same metric, they can extract the grid costs out from what you produce. It seems unfair until you know how it all works.

 

[Lesifass]

????? Who's is talking about using the grid for free? If I want 20kW available at a moments notice... fine... charge me a demand fee based on that. If I want to export a MWh then import it later... fine... charge me a fee for that.

+1

Also, if there are fixed costs for each household, charge a yearly fee.

The problem is that most power meters around here only measure kWh and can't be accessed remotely. So demand fees are impossible, just like time-based kWh fees (or even time-based demand fees… Use 22kW at peak time? You will pay for it…). So all of the costs are added to the fixed €/kWh price and the €/year price. Of course that makes self-generation (and even battery storage) appear a little "unfair" because you don't pay for some of the fixed grid costs associated with your grid connection.

The problem is not self-generation though, but simply the limited usefulness of dumb power meters. Or dumb pricing schemes where smart meters are available.

 

[rolosrevenge]

They are scared, we've already seen them working with law-makers in certain locations to make it mandatory that you stay on grid, or the house can be condemned!

No they're not scared. If you run the numbers to achieve the same degree of reliability for your power usage (using time series simulations) you'll find that your system would need to be so ridiculously oversized, it would never pay for itself. They are scared of a large number of people not paying their fair share which would cause serious economic consequences.

 

[green1]

No they're not scared. If you run the numbers to achieve the same degree of reliability for your power usage (using time series simulations) you'll find that your system would need to be so ridiculously oversized, it would never pay for itself. They are scared of a large number of people not paying their fair share which would cause serious economic consequences.

If it would never pay for itself, then they shouldn't need to lobby to make it illegal to do so.

 

[rolosrevenge]

If it would never pay for itself, then they shouldn't need to lobby to make it illegal to do so.

Maybe they're trying to stop misguided folks, don't know how to do time-series power system simulation studies, from walking themselves into an energy nightmare.

 

[beeeerock]

Maybe they're trying to stop misguided folks, don't know how to do time-series power system simulation studies, from walking themselves into an energy nightmare.

LOL!!!! Seriously?? Do you *really* think they give a single crap about the consumer's well-being??

I simply can't believe that for even a millisecond.... the notion is so abstract it makes my head want to explode.

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Nope, because when you self produce while still connected to the grid, you are shirking your fair share of the grid fees. The mistake was bundling grid costs into energy costs based on your yearly, presolar usage, but by that same metric, they can extract the grid costs out from what you produce. It seems unfair until you know how it all works.

Then it should be based on the kWh that actually travel through the grid. If you don't sell back a single kWh, why would you pay for each kWh you generate and use yourself? That would be like taxing every carrot I grow in my garden, whether I sell them at the farmers market or eat them at home.

The same argument would say that if I have a rainwater collection system to water my yard, I should pay for each litre I put on the grass, not just the ones that come from my municipal water service.

 

[TheTalkingMule]

Wow, you guys had all this conversation? It's simple, your production and consumption that never touches "the grid" represents revenue they should have received therefore a fee has been levied to help bridge the revenue gap.

Is that completely insane, irrational, unfair and borderline theft? Sure.

Next question?

 

[markwj]

Any non-utility owned generators do pay generation fees. They pay connection fees, they pay wheeling tariffs to anyone who owns wires in between them and their contracted customer. Residential solar has been ignoring these for a while, but as the penetration increases, they need to behave like any other independent power producer. It stings for the people who enjoyed their fat subsidies, but the system needs to be sustainable.

The example you have chosen is not representative of what is happening here.

This is not about one generator having a contract with a subscriber across the state, and having to pay for his use of the grid between his power station and his subscriber.

This is about the power company buying power, then charging the generator a fee just to be a generator (and seemingly charging them that generator fee both for the power they sell as well as the power they buy).

I get that the power company needs to fund the grid. Just like telcos need to fund the telephone system, ISPs the Internet, and the mango distributor his distribution network. The difference is that in all those other systems it is done by a simple buy/sell margin.

 

[rolosrevenge]

Then it should be based on the kWh that actually travel through the grid. If you don't sell back a single kWh, why would you pay for each kWh you generate and use yourself? That would be like taxing every carrot I grow in my garden, whether I sell them at the farmers market or eat them at home.

No it's not, because when the rates were calculated, your portion of the grid connection per/kWh was calculated based on your yearly usage of energy pre solar. So even if it doesn't touch the grid, you're getting a grid connection for a fraction of the cost at the expense of others without solar.

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The example you have chosen is not representative of what is happening here.

This is not about one generator having a contract with a subscriber across the state, and having to pay for his use of the grid between his power station and his subscriber.

This is about the power company buying power, then charging the generator a fee just to be a generator (and seemingly charging them that generator fee both for the power they sell as well as the power they buy).

I get that the power company needs to fund the grid. Just like telcos need to fund the telephone system, ISPs the Internet, and the mango distributor his distribution network. The difference is that in all those other systems it is done by a simple buy/sell margin.

Generators have to pay a connection fee, they only can sell at the wholesale rate, their power has to be firm and they have to keep the contracted amount. Additionally they add stability to the grid and voltage support because they are synchronous generators. If you want to play in that world, you should be charged the annual connection fee, only be reimbursed at the wholesale rate, and then be charged for the ancillary services required to firm your power and the reduction of system inertia. Then you also need to pay your fair share as a residential customer, which was calculated based on your yearly kWh usage pre-solar. If you were to do all of the math, you'd find that the fee you are currently paying leaves you much better off than if you were to do all of that.

What surprises me is that people somehow think that these fees are arbitrarily assigned by fat cat execs thinking about stuffing their pockets, when in reality they are determined by well informed, experienced engineers who know how everything works and what it needs to cost to keep the system running properly.

The long term solution is to decouple the grid services from the price of energy and bill separately, then then charge market based rates, connection fees, wheeling tariffs, and balancing fees to any and all DGs.

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Wow, you guys had all this conversation? It's simple, your production and consumption that never touches "the grid" represents revenue they should have received therefore a fee has been levied to help bridge the revenue gap.

Is that completely insane, irrational, unfair and borderline theft? Sure.

Next question?

No, it isn't theft, because the whole time you're still connected to the grid and get to use it whenever you want. That's what you're paying the fee for. If you don't like it, calculate how much it would cost to make your own system as reliable as what you're getting and see how much money you save by being grid connected.

 

[nwdiver]

No it's not, because when the rates were calculated, your portion of the grid connection per/kWh was calculated based on your yearly usage of energy pre solar. So even if it doesn't touch the grid, you're getting a grid connection for a fraction of the cost at the expense of others without solar.

.... so what are they going to do when this forces more people down wk057s path? Just get a battery backed system that never exports. How would they stop that? You're still connected but not interconnected... energy only flows in. From their perspective you just have a really really efficient home.

I'm already recommending this to other people in SPS service territory. Get a Radian and some golf cart batteries.... Save $50/mo in idiotic production fees. You lose the ability to export. NM loses clean energy. SPS loses the ability to buy solar energy for cheap.... yeah.... that sounds like a 'win'. Gotta be an equitable way to work this out. There's very very little solar here... <0.1% peak.

So there's no way for them to maintain the grid by only collecting payment for use of the grid? I find that very difficult to believe.

It's called the USPS, and they do prohibit UPS and FedEx from using mail boxes.

Bit of an apples/oranges comparison... you can deliver packages without mailboxes... good luck trying that without roads (aside from future amazon drones). AND Fedex actually delivers to my USPS mailbox. Working together for the mutual benefit of everyone. SPS could learn a thing or 3.

 

[santana338]

I got an email from Senator Angus King (ME) today that says the Senate is working on legislation on this topic. The email doesn't give a bill number or any way to identify it, but it may be possible to find out and start a campaign to make this whole thing more fair.

Here is the Senator's complete email for those whoe want to read it:

I wanted to take a few minutes to write and tell you about the energy bill the Senate is currently discussing. I appreciate the progress we made in this bill, and hope to see it pass, but there is a key aspect of our energy landscape that is being overlooked: an energy distribution revolution, driven by individuals.

For 130 years, the American electrical system has worked in basically the same way: Central power plants supply energy to homes, with homes as the passive recipients of energy. But now that’s all changing. Thanks to a major price drop in solar energy over the past 25 years, people have been empowered to harness the power of the sun – the great nuclear fusion device in the sky, which delivers energy to every spot on Earth. It’s now easy and affordable for individuals and organizations to outfit their homes with distributed energy resources – called DERs – such as solar panels on their roofs, batteries in their basements, smart appliances, demand response and smart grid technologies. Recent reports show that about a million Americans have solar panels on their homes already, and an estimated six million more Americans are shopping for solar right now.

This change is bringing literal power to the people. Unfortunately, while innovative technologies are here, they still aren’t having as large a reach as they should. This is because the policies governing how these technologies work with existing energy grids are lagging behind. For example, utilities companies are able to charge expensive grid connection fees, which discourage individuals from pursuing new, green technologies like solar panels. An energy revolution is upon us, and we are letting outdated policies choke the industry in its infancy. There’s no reason why we can’t have a system that is fair to consumers and to grid operators – and that takes advantage of the possibilities of innovative technologies instead of limiting their potential.

While these issues are not addressed by the Senate’s current energy bill, we still have the chance to address them through the Free Market Energy Act, which I put forward last spring. This legislation would enable states to set their own rules around how DERs interact with the grid, while making it easier for consumers to use their own energy resources.

This legislation will have several benefits:

It will strengthen the existing energy grid. During high-demand times, people can use their DERs rather than connecting with the grid, diminishing the chances of outages and making our grid more resilient.
It will fuel our economy. Creating a free-market framework will allow for competition that improves services and creates jobs.
It will make us less dependent on fossil fuels and have vast environmental benefits.
It will make our nation more secure. One of our greatest national security vulnerabilities is the threat of an attack on our electric grid. By supporting DERs, we’d create resilient, self-healing infrastructure.

Individuals and companies that use DERs deserve compensation for the energy they provide to the grid, and grid owners deserve fair compensation for the costs of maintaining the grid; this bill can help us achieve both goals.

These proposals are modest. I’m not suggesting that we wrangle power from states, or that we undermine public utilities. It’s simply time to factor in both the benefits and costs of solar power and find the right balance between compensating our essential utilities and offering fair policies to consumers.

This change isn’t just coming – it’s already here. Now the question is how to best pave the way for our energy future. I believe the Free Market Energy Act is a strong first step in that direction. I appreciate you reading, and I look forward to keeping you posted on this as we move forward.

Angus

 

[woof]

...when the rates were calculated, your portion of the grid connection per/kWh was calculated based on your yearly usage of energy pre solar. So even if it doesn't touch the grid, you're getting a grid connection for a fraction of the cost at the expense of others without solar.
.

Some hypotheticals:
1. Assume I have a large older home that has leaky windows, ancient heat pump, no insulation, and uses lots of power. Then I rebuild the house, update all the appliances to the latest energy efficient models, put in LED lighting, gas heat, insulate the heck out of the place, and now my power usage is cut in half.

Do I have to pay "extra" for not using the power I used to? Am I to be penalized for saving energy? I assume not.

2. Now, same old house, same massive power usage, and instead of making it more efficient, instead I install a solar array and battery that covers half my usage. Now what happens to my energy bill? Please explain why it should be different than #1. (Note, I'm not exporting excess power to the grid in any way).

3. Same situation as 1, but after I cut my power in half due to conservation and efficiency, in addition I add a solar array and battery that covers the rest of my usage. My net usage of grid power throughout the year is 0 kWh. Now what happens to my energy bill?

 

[nwdiver]

Some hypotheticals:
1. Assume I have a large older home that has leaky windows, ancient heat pump, no insulation, and uses lots of power. Then I rebuild the house, update all the appliances to the latest energy efficient models, put in LED lighting, gas heat, insulate the heck out of the place, and now my power usage is cut in half.

Do I have to pay "extra" for not using the power I used to? Am I to be penalized for saving energy? I assume not.

2. Now, same old house, same massive power usage, and instead of making it more efficient, instead I install a solar array and battery that covers half my usage. Now what happens to my energy bill? Please explain why it should be different than #1. (Note, I'm not exporting excess power to the grid in any way).

3. Same situation as 1, but after I cut my power in half due to conservation and efficiency, in addition I add a solar array and battery that covers the rest of my usage. My net usage of grid power throughout the year is 0 kWh. Now what happens to my energy bill?

The difference? Crooks like SPS can measure and charge you for situation #2...

 

[beeeerock]

No it's not, because when the rates were calculated, your portion of the grid connection per/kWh was calculated based on your yearly usage of energy pre solar. So even if it doesn't touch the grid, you're getting a grid connection for a fraction of the cost at the expense of others without solar.

If you're suggesting this is in any way right or fair, I reject the assertion out of hand.

If the power utility company can charge you more for the power you generate before consumption than what you get back via export... you're paying THEM for the privilege of generating green energy. That's what nwdiver is faced with... and that's not just wrong, or simply stupid... it's also just plain eff'd up.

If anyone thinks this is the green future, we might as well all bend over and kiss our butts goodbye - because stifling progress will kill us, both literally and figuratively.

 

[omgwtfbyobbq]

It's called the USPS, and they do prohibit UPS and FedEx from using mail boxes.

They don't do that in all cases.

Blue and brown make green

No they're not scared. If you run the numbers to achieve the same degree of reliability for your power usage (using time series simulations) you'll find that your system would need to be so ridiculously oversized, it would never pay for itself. They are scared of a large number of people not paying their fair share which would cause serious economic consequences.

There are many utilities that provide incentives for customer enrollment in demand response programs for that reason. That's why SRP charging PV owners what they do without offering a similar program is total horse hockey.

 

[rolosrevenge]

Just get a battery backed system that never exports. How would they stop that? You're still connected but not interconnected... energy only flows in. From their perspective you just have a really really efficient home.

Except not, because your solar panels also impact the system voltage and if there's a fault on the grid, you'll supply fault current, which requires a change in the protection coordination. But nice try.

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Some hypotheticals:
1. Assume I have a large older home that has leaky windows, ancient heat pump, no insulation, and uses lots of power. Then I rebuild the house, update all the appliances to the latest energy efficient models, put in LED lighting, gas heat, insulate the heck out of the place, and now my power usage is cut in half.

Do I have to pay "extra" for not using the power I used to? Am I to be penalized for saving energy? I assume not.

2. Now, same old house, same massive power usage, and instead of making it more efficient, instead I install a solar array and battery that covers half my usage. Now what happens to my energy bill? Please explain why it should be different than #1. (Note, I'm not exporting excess power to the grid in any way).

3. Same situation as 1, but after I cut my power in half due to conservation and efficiency, in addition I add a solar array and battery that covers the rest of my usage. My net usage of grid power throughout the year is 0 kWh. Now what happens to my energy bill?

1. Yes, you would be now paying for less of the grid, and if everyone did this, the rates would go up. The best way is to decouple grid maintenance from energy.

2. This is different than #1 because now you have an active source. It changes the system voltage. It changes the system model. It has more variability and a worse load factor than #1, which makes it more expensive. While you may think that power never leaves, what happens when you go on vacation in the spring on a sunny day? What about during a grid fault? It will provide some fault current, so new protection coordination needs to be done to see if there are required upgrades. Do you have a switch to ensure that no power can ever flow out?

3. The solar doesn't really cover the rest of your usage, because you have no way to balance the power within your house. Instead you are using the grid's resources to do that. Remember power must be perfectly balanced every second of the day, not just the energy. In this case you should be charged for the power and energy you buy from the grid, your connection to the grid, your solar's connection to the grid, and then receive wholesale rate for your solar production, minus the additional ancillary services costs.

Since we're on hypotheticals, I will pose three to you.

1. Two houses on a distribution transformer (DTF) have solar, the third house on the DTF installs solar such that it is overloaded during the middle of the day. A new $10k DTF needs to be purchased, who pays for it?

2. 20 houses on a lateral have solar. When the 21st adds solar, the lateral voltage begins to exceed the ANSI standard. Voltage compensation needs to be installed. Who pays for it?

3. 200 houses on a feeder have PV. When the 201st adds their solar, the protection coordination study shows that fuses no longer can adequately coordinate, and a new digital relay scheme costing $50k must be installed. Who pays for it?

I've got many more, I do renewable integration research for a living.

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The difference? Crooks like SPS can measure and charge you for situation #2...

No, if you understand how the power grid works, you'll see there is substantial difference between adding an active source to a traditionally passive network than simply reducing the load on the network.

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If you're suggesting this is in any way right or fair, I reject the assertion out of hand.

If the power utility company can charge you more for the power you generate before consumption than what you get back via export... you're paying THEM for the privilege of generating green energy. That's what nwdiver is faced with... and that's not just wrong, or simply stupid... it's also just plain eff'd up.

If anyone thinks this is the green future, we might as well all bend over and kiss our butts goodbye - because stifling progress will kill us, both literally and figuratively.

If the solar systems begin to cause more economic problems for the grid than the value of the energy they generate, than it is entirely fair. The legislation makes it so the utilities have to purchase it, but they don't have to lose money doing so. I have no doubt some engineers looked long and hard at the problems the system was facing, and then came up with a solution that would be viable given the regulatory politics of where they lived. The best solution, of course, would be to fully decouple grid fees from energy and have solar be treated like any other generator. Meaning they get paid wholesale minus the ancillary services costs and wheeling tariffs. But since average wholes sale price is around $50/MWh and the average retail is around $0.13/kWh, over half of the cost is grid fees, so it would be a drastic change that a lot of people would oppose since it would negatively impact them. Therefore, it's politically hard to get that way.

 

[green1]

n makes it so the utilities have to purchase it, but they don't have to lose money doing so. I have no doubt some engineers looked long and hard at the problems the system was facing, and then came up with a solution that would be viable given the regulatory politics of where they lived. The best solution, of course, would be to fully decouple grid fees from energy and have solar be treated like any other generator. Meaning they get paid wholesale minus the ancillary services costs and wheeling tariffs. But since average wholes sale price is around $50/MWh and the average retail is around $0.13/kWh, over half of the cost is grid fees, so it would be a drastic change that a lot of people would oppose since it would negatively impact them. Therefore, it's politically hard to get that way.

Actually, we'd love that, here's an interesting article from my area about how traditional power wholesalers are being paid more per kWh for dirty electricity than small solar producers are getting paid for their clean power:
How wind and solar reduces the price of electricity in Alberta | Blog Posts | Pembina Institute

Keep in mind that solar generates power when it's most needed during the day, the time when power prices are at their highest.

Alberta has the only deregulated electricity market in the country and in this market the wholesale price fluctuates hourly depending on supply and demand. Since the highest demand for power is during the day when people are working the price for electricity is highest exactly when solar panels are producing electricity.
But due to Alberta’s micro-generator regulation, small microgenerators (those under 150 kilowatts in size) get the retail price for any electricity they produce. That retail price is lower than the daytime wholesale price and as a result small solar generators have to sell their electricity at a discounted price. That imbalance means people with solar panels on their roof are selling their electricity with anywhere from a 1.5¢/kWh to a 6¢/kWh discount.

If you look at the linked document, the average hourly pool price for wholesalers during the peak solar producing hours of the day is around $0.13/kWh, but the most I can get if I'm selling solar back to the grid at that time is $0.07/kWh even though I buy electricity for $0.14/kWh regardless of the time of day. Why should my solar power be worth less than the electricity coming from the coal plant that I'm competing with?

 

[rolosrevenge]

Why should my solar power be worth less than the electricity coming from the coal plant that I'm competing with?

Because a dirty coal plant can guarantee a fixed power amount for an entire hour, deliver it, as well as give system inertia for stability, as well as provide voltage support to the transmission grid. Your solar can't do any of those things, so its power is less valuable.

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Also, if the grid operator needs more power, they can ask the coal plant for 10% more, for example, and get it. Another thing the solar can't do.

 

[green1]

Because a dirty coal plant can guarantee a fixed power amount for an entire hour, deliver it, as well as give system inertia for stability, as well as provide voltage support to the transmission grid. Your solar can't do any of those things, so its power is less valuable.

So... Once everyone gets fed up and go off grid because of those horrible policies, how will you make a living?

Batteries are coming down in cost, so are solar panels. These policies WILL make people go off grid, sure, you'll try to lobby politicians to make it illegal to do so, but you can only stem the tide for so long. The grid SHOULD help balance all the production and consumption. But your greed will be your undoing. It's really sad actually though, because it would be better for everyone if the grid could be useful, having my house producing at a time when the electricity is most needed, only to store it for later is horribly inefficient compared with me feeding those who need it, and using other production when I need it. It's too bad that the greed of the utilities will ruin it for everyone.



"It is difficult to get a man to understand something, when his salary depends upon his not understanding it!" -- Upton Sinclair

 

[rolosrevenge]

So... Once everyone gets fed up and go off grid because of those horrible policies, how will you make a living?

Batteries are coming down in cost, so are solar panels. These policies WILL make people go off grid, sure, you'll try to lobby politicians to make it illegal to do so, but you can only stem the tide for so long. The grid SHOULD help balance all the production and consumption. But your greed will be your undoing. It's really sad actually though, because it would be better for everyone if the grid could be useful, having my house producing at a time when the electricity is most needed, only to store it for later is horribly inefficient compared with me feeding those who need it, and using other production when I need it. It's too bad that the greed of the utilities will ruin it for everyone.

Lol. Do the time series simulation to see how big your system will have to be in order to completely go off the grid. Do an entire year. Imagine one overcast week. If you only produce 20% of rated during that whole week, how big does your system need to be. Assuming 12 kW max power and 30 kWh/day and 10 hours of sunlight, you'll need 15 kW solar with 12 kW/15 kWh battery. But you're in Alberta, so in the winter say you only get 6 full hours of sunlight. Then you'll need a 30 kW PV system. Go price that. I'd say $30 k for the PV another $10-15k for the battery. So how many years to break even. What if you have a week where it's snowing and you only get 10% production. Then you need a 60 kW system, now you're around $70 k for your power needs. Do you even have that much space? I didn't even do round trip efficiency losses in this calculation.