PV1
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Residential Solar Regulations

Thu Oct 27, 2016 1:18 pm

https://insideclimatenews.org/news/2010 ... mendment-1

Reading this article, they mention net metering as a subsidy. Does net metering work differently in other states? My agreement is that the utility will buy my excess kWhs, just like I buy their kWhs. These kWh credits are 1:1 throughout the year, but excess at the end of the energy year is (supposed to be) a dollar true-up at the wholesale rate.

PV equipment isn't free, so why should I have to pay the utility to absorb my excess, aka, give away power I generate that the utility will end up selling to my neighbors? I still pay a line fee every month regardless of energy flow, and any kWhs I consume that I didn't generate credits for, I pay all distribution and generation charges on.

We don't get free power from the grid. Any kWh credits that I take advantage of, I had to generate that power and push it out to the grid in the first place. How is that considered a subsidy?

Thoughts?
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mdbuilder
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Re: Rooftop Solar Regulations

Thu Oct 27, 2016 5:55 pm

The rates were originally set to pay costs, recover capital investment and provide a profit for each Kw sold. If a large percentage of customers generate their own power when the sun is up you've removed the ability to recover capex and make a small profit on those Kw's thereby shifting those costs to the remaining customers.
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PV1
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Re: Rooftop Solar Regulations

Fri Oct 28, 2016 6:15 am

So, they effectively lose a customer when the customer installs solar? How would that be different than if a lot of people left an area, or the city underwent a major efficiency improvement and overall consumption dropped 50%?

(I'm trying not to make this sound snippy, but just have a calm conversation on the matter. I know how interpretation can be skewed on the internet ;) .)
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mdbuilder
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Re: Rooftop Solar Regulations

Fri Oct 28, 2016 10:46 am

There would be no difference. The power company would raise their rates or go bankrupt, it is a monopoly. When the NIMBY's and the state caused the Shorham nuclear plant to shutdown shortly after it's first startup on Long Island NY in the 80's (? might have been late 70's?) the rate payers paid. I'm sure many of them supported the shut down and many of them didn't, the later were subsidizing the former - similar issue.
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mdbuilder
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Re: Rooftop Solar Regulations

Fri Oct 28, 2016 10:50 am

Stranded investment I believe is the term for CAPEX not yet paid back by ongoing revenue when some market force changes. Recovering stranded investment is a valid reason to change rates on current customers of a monopolist to make up the difference.
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Aerowhatt
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Re: Residential Solar Regulations

Sat Oct 29, 2016 4:00 pm

PV1 wrote:https://insideclimatenews.org/news/20102016/florida-solar-ballot-measure-halt-clean-energy-utilities-amendment-1

Reading this article, they mention net metering as a subsidy. Does net metering work differently in other states? My agreement is that the utility will buy my excess kWhs, just like I buy their kWhs. These kWh credits are 1:1 throughout the year, but excess at the end of the energy year is (supposed to be) a dollar true-up at the wholesale rate.

PV equipment isn't free, so why should I have to pay the utility to absorb my excess, aka, give away power I generate that the utility will end up selling to my neighbors? I still pay a line fee every month regardless of energy flow, and any kWhs I consume that I didn't generate credits for, I pay all distribution and generation charges on.

We don't get free power from the grid. Any kWh credits that I take advantage of, I had to generate that power and push it out to the grid in the first place. How is that considered a subsidy?

Thoughts?


One thing power companies never talk about is that residential solar producers give them excess power to sell to your neighbors. Even if they credit you at retail by net metering (which only seems fair . . . not charging you for what you didn't use) they still have the added benefit of selling your excess power at retail to your neighbors with only local transmission costs. They don't pay for equipment or generation so this power is basically nearly 100% profit for them.

In recent hearings here, this never came up. Not even the opposition to a PER SOLAR KW installed proposed monthly fee to solar producers mentioned it! Near as I can tell wholesale generation costs are around $.04 to $.06 per kWh. So when they resell your excess, you have saved them 4 to 6 cents per kWh on the power they delivered to your neighbor. No generation cost for them to provide it.

Now if you look at different production levels it calculates out more or less advantageous to them. But make no mistake it is advantageous to them. If I produce about the same amount I use each month then they effectively loose me as a customer except for my monthly connection charge (which by the way is supposed to be sized to support the distribution system). So they lost a customer at say 50% gross profit. However they also provided the same amount of power (my power) to my neighbors at 100% profit. (poor babies). So who is subsidizing who?? Solar residential producers provide peak power during peak power demand and unless more than 50% of the power the utility sells is customer produced solar they do just fine.

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mdbuilder
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Re: Residential Solar Regulations

Sat Oct 29, 2016 4:25 pm

errr, you used what you 'didn't use' and 'sold them' the excess you over generated so you could time shift it to later in the day not not pay for what you use later.

Additionally, you are avoiding the cost required to avoid this whole issue entirely. Which is, you could install a battery at what, 15K? And replace that every 8-10 years. Much cheaper to avoid all that and use the utilities equipment for free.
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Don
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Re: Residential Solar Regulations

Sat Oct 29, 2016 4:49 pm

Mississippi was the 45th state to pass a net metering law, so obviously they don't have much experience . . . . but at least we weren't 50th as we are in so many other categories

As to what your solar Kw is worth compared to the Kw the utility sells you, I found this discussion

"The economics are simple. The value of a kilowatt-hour produced by a utility is derived, in part, by the fact that such power is guaranteed to be available. The current residential rate for electricity in Mississippi today is about 11¢ per kilowatt-hour. That figure includes all of the costs of producing power, including the fixed costs of the system, as well as the value of knowing that power will be available when customers need it. On the other hand, customers who produce solar power from their rooftops don’t offer a product of equal value. Those customers contribute only a token amount of power to the grid, providing none of the infrastructure and none of the guarantee that utilities do. Power that is not guaranteed to be available doesn’t have the same market value as power that is, but retail net metering treats them equally. That is a market distortion that has real dollars-and-cents consequences."

It does make sense to me that a Kw that I add whenever I want to is not as valuable as a Kw from the power company - When the sun goes down and my Kw is lost to the grid, somebody must pick up the slack and that means generating a reserve all the time (which costs money) so that the grid can absorb fluctuations. I would consider a 75% value to be fair . . . . if you can get them to agree to pay you that much. On the other hand, a value of only 50% doesn't seem fair to me at all - It is a usable Kw, for as long as it's there, though I suppose it may well be 'lost' in the reserve and effectively go unused - Still, it has value

Don
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mdbuilder
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Re: Residential Solar Regulations

Sat Oct 29, 2016 5:27 pm

Well said.

Look, when it cost 50k+ and hardly anyone could do it to install solar on your house net metering was great idea that provided some incentive for the early adopters. It won't last forever because it is not fair. At some point it will change, maybe soon or maybe in 10 years but it will change.

If you think about it and look at one of those graphs showing the parabolic increase in installed solar, ask yourself why? That is not happening because millions of fellow Americans have become evangelicals for solar. It is happening because of the invention of purchase power agreements by Wall street. The PPA allows a very profitable business for the installer and a big cut of profit for the banker TODAY all coming from what you the customer will pay over the next 20 years.

When the salesman for the solar company shows up at your house in a $50,000 <2 or 3 year old shiny crew cab pickup and the installation crew arrives in shiny new cargo vans there is something making the whole system a little too profitable. Tax credits and net metering.
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PV1
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Re: Residential Solar Regulations

Sat Oct 29, 2016 6:27 pm

Cost of batteries have come down considerably. Tesla's new Powerwall holds 14 kWh and can output 5 kW and costs $5,000. Used Model S battery modules are about $5,000 for 21 kWh, but you'll need to add a $3,000 watt inverter. So, $5,000-$8,000 for a battery system that should be able to float a small house indefinitely.

Even if solar isn't (yet) dispatchable power, it does provide power during on-peak hours, which collectively over a region would negate the need to ramp up base load generation or fire up peaker plants. Between solar and EVs, demand should flatten out, and that should benefit the utilities.
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