By Robert Bradley Jr. — January 5, 2022
“Since rooftop solar customers pay less on their utility bills, they end up contributing less toward maintaining the grid, which they still use. That has meant the cost burden was shifted to those without rooftop solar, and often those who can’t afford it.” (Wall Street Journal, below)
“For rooftop solar companies, generous incentives were the training wheels that had to come off at some point.” (Wall Street Journal, below)
Solar as a grid source of electricity is uneconomic, from the rooftop to the large solar arrays. So various government interventions pushed by the solar lobby must come to the rescue.
Solar’s Investment Tax Credit (ITC) offers a dollar-for-dollar federal tax credit for 26 percent of the cost of installing solar. Enacted in 2006, it has been extended several times and continue through 2023.
But then comes net metering, a local/state program that requires utilities to buy solar from the same rooftop systems–at inflated prices.
Jinjoo Lee’s recent ‘Heard on the Street’ piece, Solar Starts Year with Long Shadows, in the Wall Street Journal (January 3, 2022) reveals how this subsidy is under fire, making the solar proposition a shaky political bet for the “energy transformation.”
“Rooftop solar companies aren’t exactly starting the new year with the sun shining on their faces,” the article begins.
Shares of residential solar companies Sunrun and Sunnova have fallen 19% and 14%, respectively, since the California Public Utilities Commission put subsidies for rooftop solar—known as net metering— on the chopping block in December. The commission plans to vote on Jan. 27 after taking public comments.
Florida is considering legislation that would cut such subsidies. The shock to their share prices isn’t surprising given that the two rooftop solar companies don’t yet generate a profit; their shares trade largely on growth prospects.
California and Florida–two of the sunniest states. And just imagine if the ITC were to expire too! Then it would be ‘game over’ for rooftops on the grid except for the wealthiest persons wanting to virtue signal.
The Golden State has the highest electric rates in the lower-48. It is mecca of high-cost energies, including solar. Jinjoo Lee continues:
California is a leader in rooftop solar adoption and as of 2020 accounted for roughly a third of all new residential solar installations in the U.S., according to Wood Mackenzie and the Solar Energy Industries Association. The state’s customers account for roughly 40% of Sunrun’s installed base and a quarter of Sunnova’s, according to estimates by RBC Capital Markets.
Much of California’s rooftop solar growth has been fueled by the net-metering system, which allows solar customers to sell the excess electricity they don’t use back to the grid at a pretty generous value, the same retail rate they are charged for their home electricity. That has helped spur solar adoption as intended, but someone else has had to pick up the tab.
Specifically, other ratepayers foot the bill, which has put the issue into play:
Since rooftop solar customers pay less on their utility bills, they end up contributing less toward maintaining the grid, which they still use. That has meant the cost burden was shifted to those without rooftop solar, and often those who can’t afford it. Various groups peg that cost shift at between $1 billion and $3.4 billion a year.
The new rule would cut the rate solar customers get for selling their excess energy by a fair chunk. The rate will decline to 3 to 4 cents per kilowatt-hour during most sunny hours of the day, down from 17 to 44 cents per kWh previously, according to estimates from Pol Lezcano, North America solar analyst at BloombergNEF.
The economics are ruined:
It also adds a carrot in the form of a credit for installations and a stick in the form of a “grid charge” for solar users. The bottom line is that it will take new solar customers about 11 years to make back their upfront investment in their solar panels through reduced electricity bills, a substantial jump from the seven years it currently takes, according to BloombergNEF estimates.
Intermittency, creating the state’s infamous ‘duck curve,’ is a big part of the problem:
Net-metering rules have always been contentious across the country, but an overhaul seemed inevitable in California. Its solar-heavy grid has an abundance of electricity during daylight hours but a steep drop once the sun sets. That creates strains. Hawaii, which saw furious growth in rooftop solar before getting rid of net metering in 2015, had to do so largely out of necessity—parts of its grid were overwhelmed by a surge of solar electricity generated during the day.
“There are some silver linings to this,” Lee adds. (Can’t be too critical to a pillar of the ‘energy transformation.’)
One is that California’s rooftop solar market is no longer at the peak of its growth, which has slowed in recent years … [at] roughly 15% of California households living in single-family detached structures….
That means growth, to some extent, has to come from selling battery storage to those existing solar customers. The new rules create a price incentive for households to add storage to solar systems, according to Mr. Lezcano.
BloombergNEF estimates that with the new rules, the payback period for solar-plus-storage will decline to six years by 2027, down from eight years now.
For rooftop solar companies, generous incentives were the training wheels that had to come off at some point. Expect some wobbles ahead, but not a crash.
Or a crash if batteries are not subsidized, and the ITC withers away.
So, basically, all those who can’t afford these silly things are going to be screwed even more to pay for the useless toys of those who can afford them.
Yes, but these some of these installers also suffer from early adopter syndrome and when new better panels appear they sell off the old and install new. I buy their 2 to 3 year old cast offs, self install, never claim any excess as I divert it to heat water, cost is a fraction of a UK Govt registered and subsidised install and so payback is in my case 4.5 years.
If all you are using the panels for is to heat water then direct thermal solar heaters are far more efficient and lower cost !
You are forgetting maintenance, pumps fail far to often.
Same as electric cars….
Some other rate payers foot the bill and some others without solar don’t. California has multiple rate plans, solar plans, renewable energy plans and low income rate plans. The California legislature forces all utilities wishing to sell electricity to abide by all the laws the legislature enacts.
To discuss changing the plans during an “existential climate crisis” which all the laws were designed to mitigate can only mean the legislature was stupid to begin with, or are corrupt.
There is no other explanation. It’s clearly bait and switch.
I go with corrupt.
I think you repeat yourself. Stupid AND corupt.
“the legislature was stupid to begin with, or are corrupt.”
¿Porque no los dos?
As long as the federal government helps CA with their spending schemes CA can create more lunacy.
And how long if someone monkeys with Sunrun and Sunnova stocks making their market valuation too volatile to invest in with confidence?
Battery storage, for a few days of cloudy weather, costs 10x more than the panels ($1,000/kwh rooftop & $350/kwh for grid scale). The only thing worse than subsidizing solar panels is subsidizing battery storage. The Cali legislature will be more than generous. The only certainty, for us here in Cali, is whatever they do, it will be worse than doing nothing.
Rooftop, turnkey, is $2000/kW of panels, in California, more elsewhere.
Grid-scale, custom-designed, site-specific, battery systems are at least $550/kWh, delivered as AC, more elsewhere. That excludes the cost of financing.
All electricity passing through such a battery system has an A-to-Z loss of about 20%, more with aging.
$350/$550 all the same, too expensive, power people need to give it up. You’re number is probably better, mine is just internet data not real world invoiced project accounting. My understanding is a lot of “battery storage” is more about frequency control than storing electricity for 4 hours or more. How crazy can anyone be too spent $millions for minutes?
From the POV of the grid operator, the battery storage is more to smooth out the duck curve than anything else. That is, store daytime excess power into the batteries rather than put it on the grid, and then sell it later during the evening peak. Potentially they could woo people to do this by giving them better rates during this peak period.
“Potentially they could woo people to do this by giving them better rates during this peak period.”
With net metering and a Demand Time-of-use electricity rate program, customers get hammered with more than double the power rate during peak periods.
I was talking about people selling excess power to the net (from their batteries) getting paid more during peak periods. That could potentially encourage solar PV owners to buy expensive battery storage systems.
Somebody doesn’t understand the term ‘Net Metering’
Certainly originally and UK -wise net metering was the most basic solar arrangement.
The punter installed panels on his house and connected to the grid via a basic grid-tie inverter
But many punters originally had was a ‘spinning disc’ electric meter and those would run, and count, backwards.
Thus if the punter used the solar power directly, fine.
But if the punter didn’t use his own solar, the power went out onto the grid totally free and gratis to the utility supplier but in return for the punter’s meter reading to go down.
(The utility company would then effectively sell that free electricity, at full retail price, to guy next door. What’s not to like?)
The end or the ‘net’ result was that the punter with the solar was ONLY billed for the electricity that he consumed FROM the grid.
iow: The solar punter paid for the net amount of electricity that came into his house
THAT was/is = ‘net metering’
Where it all unravelled was that ‘somebody’ didn’t like the idea of customer’s meters running backwards.
So they were changed and an extra meter (the ‘export meter’) was added to record the amount of solar energy the punter exported to the grid.
Enter ‘We’re from the Government and we’re here to help‘ and it all went pear shaped from that moment on
Gov decreed that ‘some amount’ should be paid, by the utility company to the punter, for the electricity that was recorded by the export meter
The utilities didn’t like that and THAT is what this article is actually about
Just to clarify. Does that mean that UK utilities do or don’t buy electricity from homeowners with rooftop solar?
Ben yes they do. The terms keep changing, Typically an energy supplier would pay the owner of the roof top panels for every kWh the panels produce. They also pay a much lower figure for 50% of what you produce, as that is the assumed figure of what you don’t use and goes into the grid, if you don’t have an export meter.
If the meter is running backwards, then the utility is buying that electricity.
A PIK (payment in kind) method would simply ‘pay back’ energy taken out at one time via energy ‘sent back’ (fed into the grid) at a different time.
There is no ‘buy’ to it on the part of the grid (UNLESS an agreement is in place to pay the customer for the excess energy the customer puts onto the grid over some period of time, like what would be noted at the end of a billing period.) OVER the course of a month, things would even out usually, with the customer drawing more energy than ‘putting back in’.
And, in a perfect scenario, _no_ money would ever change hands, given that your ‘meter runs backward’ if the energy flows (in and out of the grid) were equal. Ignoring of course the fixed costs of the grid network (poles, wire, xformers, etc)
Said power at the wrong time of the day is a net loss to the utility. Every watt of solar need to be back up bu infrastructure at a high cost for when the sun does not shine. Regular rate payer pick up the tab. Like most thing today, the poor subsidize the rich, how is that fair.
re: “Said power at the wrong time of the day is a net loss to the utility”
Not my problem; If the agreement btw powerco and customer doesn’t address that its not a concern of mine nor the customer. To consider otherwise is to ‘negotiate against yourself’, and people do that ALL the time.
Maybe you are unfamiliar with typical demand curves of electric power throughout a day? Sans solar, MOST demand would be during daytime hours, again, per the typical electric demand curve. But, again, you seem to want to ‘negotiate against yourself’ on this so why am I concerned? With all this in mind, re-read my post looking for other inconsistencies …
No, it’s the ‘punter’ who is selling by proxy to the guy next door at full price and getting free access to the network including free of all the infrastructure costs.
Aren’t they already paying for access and infrastructure maintenance costs as part of the “Delivery Fee” for the grid sourced energy they use from the utility?
If so, wouldn’t charging them for the power they put back be double charging?
If I drive ten miles across town, I’ve put that much wear on the road surfacing. I DON’T put that back by driving back home – I double it. Same with electricity – whichever way it is flowing, it is using up the service life of the lines, the transformers, the switching stations, etc.
Additionally, if I use surface streets, there is all of the overhead for very complex real time traffic control systems that I don’t incur if I use the freeway. Same for dealing with the very complex real time systems required to balance not just demand for one direction, but highly variable demand and supply coming from multiple directions.
I could be wrong, but I very much doubt that electricity is “using up the service life of the lines, the transformers, [or] the switching stations.” My son just bought a house built in the 1920s or 1930s. The wires and switches were in no way used up by the electrons that had passed through them in all those years (although the insulation might have deteriorated, and the switches were probably messed up from having been pushed by too many fingers over the century or so). No house-internal transformers, but I don’t think electrons use up the wires in transformers any more than they used up the wires in the house. Transformers fail, but not because too many electrons have gone through them.
To Chris and others posting here: Utility bills include a “demand” charge (going by many different names) for a customer’s portion the infrastructure used to supply said customer. It is a fixed charge on customers’ monthly bills applying equally to that class of customer.
Although part of the billing in the UK is a daily standing charge that is really quite small and really only covers things like billing and meter reading. Most of the network charges for transmission and distribution are in fact shared out per kWh.
That practice subsidizes the low-kWh user. He is utilizing the same infrastructure as his neighbor, but pays less of its total cost.
Net metering means customers didn’t pay for every kWh they used from the grid, exports cancelled equivalent import = exports were credited at retail price.
Example grid may have the retail price based on generators paid ~35-45%, grid gets 30 to 40%, retail takes remainder, wholesale price to some biz/gov with smaller margins.
It costs money to have generation on standby during the day to be available for am/pm peaks & some overnight. It costs money to charge batteries or pumped hydro to absorb unwanted excess generation.
If spot prices sometimes go negative but avg $40/MWh then solar during day is worth about the same 4c/kWh generator price. Money doesn’t grow on trees or come from thin air. The value is based on supply & demand not fairness nor reward.
In networks with high penetration of solar rooftop, the price goes negative every sunny day.
Price in South Australia bottomed at -$190/MWh on 6th January – typical for a sunny day. That price level causes grid scale wind and solar to voluntarily curtail.
The rooftop systems do not operate to price signals but they regulate output to a voltage limit. That happens on most sunny days across Australia now. The distribution providers are working on better voltage control to get the rooftop power up the grid but it is expensive to install automatic tap changing transformers in retail networks.
Intermittency of power generators has added enormously to network costs and dispatchable generation costs. Very few people can get their head around the complexity of keeping a network stable in a world of intermittent generators.
The grid operator in Australia has 8 separate elements for stability services that are bid on at 5 minutes intervals:
This is not all the additional charges because there are also “orders” that are issued on a daily basis to keep rotating inertia on line when wholesale price is low.
If the meter readings of said punters are reduced by returning power to the grid, then the power is not free to the supplier. They pay by having reduced income from said punters.
The supplier may have had reduced income, but they also had reduced need to generate power. Or depending on the situation, the power they produced was just used elsewhere (in which case there would have been a brown-out if the punter had not supplied his own electricity). It’s no different from the reduced electricity consumption if punter installed LED bulbs instead of incandescent ones, or a more efficient refrigerator, or if they stored junk in their garage instead of a car, and therefore didn’t need to open the garage door as often (assuming an electric garage door opener).
Interestingly, many people in the UK still have the spinning disc meters, which go backwards when solar panels are generating electricity. The point is that it’s the supplier who is supposed to change the meter, but as this would cost the supplier more than the amount they lose they just don’t bother.
This is yet another example of how insane the energy supply industry has become in the UK, driven by the crazy net-zero target. Trillions of pounds sterling are going to be wasted, with millions plunged into fuel poverty.
Sooner or later the politicians are going to have to face the hard economic facts, which are that renewable energy is far from cheap. In fact this has already started, with many in the UK openly questioning the Government’s green agenda.
re: “But if the punter didn’t use his own solar, the power went out onto the grid totally free and gratis to the utility supplier but in return for the punter’s meter reading to go down.
(The utility company would then effectively sell that free electricity, at full retail price, to guy next door. What’s not to like?)”
– – – – – – – – – – – – – – –
Some posters may be having trouble with this; This is more of a PIK (payment in kind) arrangement, where you ‘pay back’ energy drawn from the grid when you have an ‘excess’. Were you to produce overall for a month MORE than you consume, and the grid provider does not reimburse you, THEN they are selling that ‘free’ electricity to your neighbor.When the time frame considered is a complete month, it makes more sense than considering energy flow minute by minute.
Of course, the cost of lines, transformer, poles, insulators and maintenance personnel is ignored in my simple explanation above. Here in Tejas the cost of infrastructure (excluding actual generators) is covered via a “delivery charge” based on the amount (of electricity) consumed.
If the meter is running backwards, the utility is not getting the electricity for free. They are paying for it at the retail rate.
Yeah … too broad an answer. Most of the electricity in these states with ‘merchant’ electricity suppliers (as opposed to the old-school top-to-bottom utility companies) run a number of ‘retail’ fronts so to speak, who actually act as middleman between the end retail customer and the other parties involved, like the entity that owns the distribution and transmission lines, and the other entities that own the generators (be they nat gas, solar, wind, nuke, whatever).
So, without specificity as to ‘who is paying what’, broad general statements just confuse the issue further.
It all a scam, first the power the solar produces at the time of day it not need most, and then they get paid for it and when they need power they get it free. All electricity must be consumed at the point and time it produced. If the utility has to dump power to keep the grid stable(they do) due to solar how is that a wind for anyone other then the owner of the solar panels. Utilities cannot survive paying retail for power they don’t need. It us people that don’t game the system that pay. Lastly if we all gamed the system the system would fail. That the future no 24/7 electricity for anyone.
As a Cali ratepayer the end of net-metering means the Cali legislature will find something worse to replace it. It’s what they do. Subsidizing battery storage isn’t the only thing they can do to make matters worse.
Green hydrogen, under the liberal business model, here in sunny Cali, is already “looking good” (almost).
Midday sunny moderate temperature days find too much electricity on the grid and solar companies need to be paid to “curtail”. In other words, the electricity has negative value, it’s worth less than nothing and the more that’s added, the worse it gets. The liberal answer is use that “even better than free” price for electricity as the input cost to a green hydrogen plant.
The real world answer is end the solar incentives and quit paying retail for this scrap power which is, because of time of day and time of year pricing, worth about a penny per kilo-watt instead of a dime. End the scam, N2N, Natural Gas to Nuclear (see NuScale and TerraPower).
Any amount of intermittent power in a network adds cost. There is no level where it actually lowers the cost. Intermittent generators should be paying ALL THE TIME to export power to the grid. They burden the grid at any level of output.
The are only two common networks where intermittent generators provide value:
I have mixed feelings on this one. As CA ratepayer, I’ve been getting screwed in this state for years by ridiculously overpriced electricity. My brother in PA pays something like 6 cents a kwh while our rates are 30-50 cents a kwh. So I finally bit the bullet on home solar to beat upcoming NEM 3 prices. On the other hand, what makes sense for the individual makes little sense in the big picture, as is so often the case with subsidies. But in a state as screwed up as CA, which is closing nuclear plants, banning gas, mandating solar on new construction and erecting massive wind farms, installing rooftop solar now may be the only way to “opt out” of the massive energy problems our brilliant politicians are creating.
Where I am (Ontario, Canada), electricity is priced based on the time of day. It’s most expensive on weekdays during working hours and gets cheaper at night and on weekends.
If I have just enough solar to run my air conditioner, I will save enough money to pay for the solar panels. So, net metering isn’t involved because I’m not putting anything back into the grid.
Of course it makes no sense to do a major project just to break even. On the other hand, if the price of electricity were to double …
Thing 1 – I wonder if, in California, solar can save you enough money that you don’t have to worry about net metering.
Thing 2 – The original plan for electricity in Ontario was to have it cheap so it would allow the growth of industry and jobs. (as far as I can tell, the theory worked well) The obvious corollary is that making electricity expensive will cost jobs.
Thing 3 – The greenies will tell us that green energy will create jobs. That’s no good if they’re low value, inefficient jobs. I am reminded of the following:
Carrying the logic to its ridiculous extreme, everyone could be subsistence farmers using sticks and stones instead of steel tools of any kind. I am reminded of this cartoon, the caption of which is:
Net Metering as it stands today in CA I think is nearly a requirement to make these systems pencil out. The upcoming change to it is going to make many of these systems non-economic at the individual level. So getting a system in place to be grandfathered into the existing rates is key. I’m not saying the macroeconomics make sense, but the microeconomics do for many homeowners.
In Nevada I got purposefully got my solar in ahead of the net metering (paid for energy at retail rates) cutoff date. Of course, Leftist politicians can change that at whim. Absent a revolution there is no escaping once socialism has a grip on you.
“So getting a system in place to be grandfathered into the existing rates is key. ” sorry no don’t make the regular rate payer pay for the solar panel owner stupidity. When I moved to Arizona I penciled it out and knew solar was a joke, on to be bought by the stupid, the worst part is the stupid are being subsidize by those of who aren’t.
LMAO. Yes, they’ll “create jobs” – that nobody can make a living doing because their worth will be so small.
Early on, Ontario passed laws requiring the solar systems and components to be locally sourced which drove away the low-cost leaders in the industry who don’t build large, expensive robotic plants because of every protectionist green that pops up. You over-paid to support those non-market jobs.
That’d be an enormous job building a solar system. First, you’d need a light-years-wide cold dust cloud collapsing on itself…. 🙂 🙂
It’s a big Keep Out sign.
Here are a few questions for solar rooftop owners.
1) Did you have to do roof replacement or significant repair work prior to the solar install?
2) Do roofing companies in CA require the homeowner to remove all the panels in order to conduct roof repairs?
3) Do birds and other critters nest under the panels?
4) What was the total and per watt cost to install?
5) Did you get a guarantee that the panels were not made with slave labor?
Just asking a homeowner, thanks
1) Required no. Considered yes. Having to replace a roof with Solar already installed is not impossible but adds to the total cost/benefit calculation for the owner.
2) Depends on the roof repair and where the repair is located compared to panel location. . To fully repair, as in a new roof, yes.
3) Yes. Critter guards are available for purchase aftermarket or made available as add-on to new installations.
4) For me, 5.5 kilowatt system, 20 panels. $14,000(tax incentive already deducted). $2.50/watt.
5) No guarantee. My panels are made by a Canadian Company. I do not know the original source of the components of the panels themselves.
I’ve always been curious how much more it takes to replace an asphalt shingled roof when said roof is covered with solar panels? And when people quote “payback times” of like 8 years or whatever for solar does that also take into account such extra roof maintenance costs?
Also if the roofer drops a panel or two and ruins it, who pays for the replacement?
The roofer does not do such things for you. They tell you what must be done before they come back.
okay so you have to get a specialist to remove them the day before the roofer comes and then reinstall them the day after…
so what does that end up costing out of pocket?
That depends on your quotes and their schedules. I hope you’re not assuming electricians are easy to find either.
In Arizona it is about $2K to remove and reinstall a typical rooftop solar array so a roof can get repaired or recoated. All done by a licensed electrician. The roofing company will not do it.
That over three years of my electrical cost here in Arizona. How that suppose to pay.
Payback time of eight years is because California is la la land. In a normal rate state there is no pay back time. By the time you get close to payback time your maintenance cost will eat that up. If we had an honest payment for what the power produced is worth there would be no payback time anyplace. Add in solar panel have an environmental cost due to the material they are made of that exceed any real of imaginary problem CO2 causes. All carbon atom in my body are from CO2! CO2 is life, heavy metal are forever and are death.
Not everyone understands that.
If the panels in question are from “Canadian Solar” they are from CHINA and made with SLAVE LABOR!!!
1) yes, partial reroofing where panels are
2) don’t know
3)I have not heard or seen critter nests to be a problem… probably gets too hot
4)$17k after the tax credit for 4.35 kwh worth of panels
5)panels were USA made
Here are a few questions for solar rooftop owners.
1) Did you have to do roof replacement or significant repair work prior to the solar install? No our roof was replaced a few years previous, but they did inspect it and if found wanting that would be required.
2) Do roofing companies in CA require the homeowner to remove all the panels in order to conduct roof repairs? I suppose they would have to temporarily remove the panels over the effected roof.
3) Do birds and other critters nest under the panels? No
4) What was the total and per watt cost to install? About $2900/rated kW before the tax write off. Even here in sunny CA, we are only able to see a peak output of about 88% of rated due mainly to placement. Not all panels are facing the same or optimum direction. During the winter we see a peak nearer 50% and of course, for a shorter duration.
5) Did you get a guarantee that the panels were not made with slave labor? What do you think? Of course not.
Just asking a homeowner, thanks
We bought them to get us out of tier 2 and tier 3 price gouging and protect us from the yearly rate increases. They will pay them selves off in savings after approx. 6 to 7 years thanks to the ridiculous power rates here in CA. We started year 4 in October. I just wish we had stayed with gas for heat, the heat pump sucks the juice even in mild CA.
5) Of course not
Do you really know the supply chain that well?
Solar Energy Industry Supplied by China’s Forced Labor | National Review
The U.S. solar industry has a Chinese problem (solarpowerworldonline.com)
So if you did not have stupid politicians and stupid voter they would be no use for solar and the associated heavy metal poising? Have you consider disposal and what it will cost you in the end when they figure solar panel have toxic metals in them?
There’s another way to opt out – leave California. I did and it was the best decision I ever made. Not only did I get a far lower cost of living (lower utility bills by ~2, lower housing costs by ~2, lower gasoline price, lower insurance etc.) I got lower crime (my car was never stolen again after I left), better air and water quality, less crowding, and better roads and traffic. I only gave up the nice climate.
I live near people who moved from CA after the Paradise fire. They had a nice climate also.
It never rains in California, but girl don’t they warn you, it pours, man it pours.
Albert Hammond, 1973
This was my experience too. I left when my nuke plant closed.
Let me add good schools and family values to the list.
Still have friends and family in California.
Solar incentives for net metering only work if the solar panels work.
There are two kinds of solar panels. Smoke emitting diodes and panels that have not caused a fire or stopped working yet.
Family that moved back to California and bought a house with existing solar panels. They were surprised with a hefty bill because the panels did not produce enough power.
Just asked what the bill was. $2400 for the last year above the electric bill.
My last two houses were all electric in climates not as mild as their California location. Annual cost of electricity was less than $2400.
In Leftist systems where laws and regulations are constantly changing, the individual and business owner has no rational basis for decisionmaking. Recognizing that problem, our Founders created a Senate controlled by the States. All checks and balances were lost when we went to direct popular election of Senators; it is now mob rule with Senators preening before the takers.
Possibly the worst amendment. Certainly in the top 3.
a pertinent question to ask you is whether your local electric utility company allows rooftop solar panels that are not connected to their grid, as it sounds like you want to take the option to go off-the-grid and consume what you produce at your home.
we live in LA and our city utility – infamous DWP – has an ordinance prohibiting install of solar without connecting it to the city grid; if you attempt to do so you will not be given an operating permit to flick the switch on.
WE have just put on solar and added a battery because I reckon our grid is going to crash at some point in the next few years. The battery means that we can largely live off the grid. Our state governments here in Australia also subsidize close to 50% of the cost. Having paid everyone else’s subsidy for years, I am not feeling guilty about that and it gets quite cold here in winter where we live so this means we can afford to heat our house even as the tariffs for power rise. . If we need to, a small generator is the only thing we need add.
But it infuriates me that it has come to this. We resisted for a long time but as we age, we recognise keeping ourselves warm in winter is an issue. The contempt I have for our government leaders that have let our grid be eaten away from within is profound. And jobs disappear too as the unreliables encourage industry to move elsewhere.
I’m curious. Just how big is this battery and how long is it supposed to last?
Hope you never need more than 4 hours of storage. If your battery can store more than that you paid too much. Plan “B” would surely have been better no matter what it was.
To enable you to truly live off-grid without using generators, you would need a really big battery system and solar array. And you would never pay it off within the system’s lifetime. On a hiding to nothing.
I suspect Quilter really means survive off-grid than live off-grid. The difference being that availability of some electricity each and every day after a sustained grid failure would allow some lighting and communication, and even refrigerated food to be maintained. You need a battery system to provide that off-grid capability, but are not planning to live off-grid continuously. A step up from that would be to construct an off-grid system aimed at providing basic daily usage, but to maintain a grid connection as the low-cost backup and peaker plant. Sacrificing being able to run the washing machine is trivial when your less prepared neighbours have no light, heat, food, or radio.
Quilter, I understand your decision and I have addressed the issues raised in this post with my local Liberal Party MP twice. The first response completely avoided addressing the cost of being connected to the grid and amounted to a sales pitch for subsidized solar but included clueless comments that made me think my MP just doesn’t understand anything about electrical power and its integral, energy The 2nd attempt at getting a response to the same questions presented in the most lucid way I could muster drew a blank. Zippo. Too hard obviously. And my MP is a conservative and part of the Govt of South Australia.
I don’t know if someone brought this up already, but doesn’t california require new housing to have solar on the roofs, since they have changed things I assume they dropped the requirement for the mandatory solar panels on the roofs
I believe they do still require rooftop solar on new construction. Just because it would make sense to drop the requirement if ITC goes away, doesn’t mean it’s going to happen. After all, this is California we’re talking about!
Since it is required, they don’t have to worry about justification with ROI terms. Just because the initial justification for the requirement included limiting future costs, doesn’t mean that the basic justification for keeping it will not shift to a different talking point.
And you can be damn certain the construction companies use the cheapest materials they can get their hands on. In about 15-20 years there’s going to be a bunch of 15-20 year old PV systems that are just sitting on roofs doing nothing.
Not at all, Cali is probably Biden’s business model for Build Back Broke.
The good news is if anyone wants to examine how well wind and solar work, Germany has proved all the answers. Energie Wende (transition to renewables) is a bright shinning display of the failed experiment:
It is estimated that so-called grid stabilizing measures due to excess wind power supply in 2020 could cost consumers a total of €4 billion ($4.5 billion) in extra bills for electricity that is sold at a negative price or even never produced.
Under Germany’s renewable energy law, which is designed to help support green power, wind turbine operators also receive compensation for every kilowatt-hour of electricity not produced if wind power surpasses peak grid capacity. Added to this, power grid operators must accept and distribute electricity from renewable sources even when there’s no demand for it.
The price of electricity can therefore turn negative, meaning that grid operators have to sell at a loss or pass the costs on to customers.
Just crazy! Hopefully the wind turbine operations in the future will face a penalty when they fail to produce when required. In a sane world the wind turbine operations should be forced to include storage.
Of course, in a sane world power grids are designed by engineers not politicians who only know tech when it involves getting their face in the media.
“ In a sane world the wind turbine operations should be forced to include storage.”
I think a better way is to demand unreliables provide reliable power at a specific time. That way they can come up with any scheme needed to supply a specific amount of power at a specific time.
Yes. That would mean that farm operators would need to contract in energy for when the wind aint blowing and throw away surplus when it was.
Negative prices are often misrepresented as bringing the cost of electricty down. They don’t. Negative prices drive the cost of electricty up even further. That is because negative prices are only ever paid for negative electricty, and a negative price times a negative amount is a positive cost. This is how it works:
“Under Germany’s renewable energy law, which is designed to help support green power, wind turbine operators also receive compensation for every kilowatt-hour of electricity not produced if wind power surpasses peak grid capacity.”. Whenever wind power exceeds grid capacity, the solar providers bid negative unit prices for the excess electricity, which the successful bids get paid for NOT producing. ie, the negative unit price applies to (wind capacity minus grid capacity) which is a negative amount of electricity.
So long-suffering ordinary consumers pay for the electricity they do use, and they also pay for the electricity they don’t use, while people with solar panels are still subsidised every single step along the way.
Dennis, In Australia they have the nerve to call the equivalent of the German experiment a market. The word market is Newspeak for the complete opposite, namely a contrivance.
Is there nothing that utopian central planning can’t wreck?
Can I have some of your money?
In the UK an EV pays no road tax. EVs are far heavier than ice cars and do more damage
One day they will have to cough up
Or point fingers with lobbyists
I recently did this. Solar panels got hooked up about a month ago. I’m not using any tax credits. The system is designed to produce 105% of my house’s demand so over the course of a year, my cost for Kw-Hr will be zero. There is a small fixed charge which I will still have to pay. I have always been aware of the problem with fixed cost shedding to other customers and I assume that at some point they would no longer be able to offer net metering, or the cost of power would have to go up (what I think will happen). They might also raise that fixed charge, in which case I will have made a bad deal. I have a low interest loan ($32k) to pay for the system and the monthly payments are about the same as what I’ve been paying for electricity. No out of pocket cost. I did not do this to save the planet, but out of curiosity, and because there was no up front cost and no increase in monthly cost. The local utility has plans to be at net zero in the very near future. I don’t see how, but that is what they’ve announced. There are two meters. One measures what the solar panels produce. The other measures how much comes to me from the grid, and how much is exported to the grid. Since it is December, the solar is not keeping up with demand, even though it’s quite sunny here. My yearly average demand is about 7.5 Kw.
“The system is designed to produce 105% of my house’s demand so over the course of a year, my cost for Kw-Hr will be zero.”
EXCEPT of course at night or when it’s foggy or cloudy.
Does that ever occur to you?
Maybe where the poster lives it’s always sunny and nightfall never occurs 🤔
Maybe he lives in Philadelphia. ;-D
I don’t think you understand how it works. If over the course of a month, the exported Kw-Hr exceeds in the imported Kw-Hr, then my net demand is zero, and I will not be charged for any Kw-Hr. Any excess exported Kw-Hr are carried over from month to month and year to year. When there is insufficient sun, which obviously happens every day, power is taken from the grid, but when there is enough sun, and produced power exceeds the demand, the excess is exported and used to offset any demand from when there is insufficient sun.
Is the system designed to be 105% in winter or summer? What happens when it rains more than average?
No, the 105% is an annual average, so over the course of a year so your exported power should slightly exceed your total demand for the year, so your net cost should be about zero, excluding the fixed fee. If the weather were to be unusually cloudy for the entire year, then you might not make it. Seems unlikely.
You realize if everyone signed on to such a plan the grid would become unsustainable. During day utility would have to buy power nobody uses. Then during night it would have to ramp up fossil fuel generation resources to fill in the massive production gaps.
End user rates of course would have to reflect supply/demand for it to make any economic sense. So the utilities would place no value on daytime electricity generated by the end users (really they would probably just cut off at the sources i.e. cease buying power) and at night the end user rates would skyrocket (to like up to $1 per kWh or more) to provide the “rescue power”. And of course such a system would not be net zero.
The utilities also would need to be allowed to reward people and industries who don’t use power intermittently by discounting their rates to a more fair price. I.e. rightfully shifting the system inefficiency costs to the intermittent users.
The only way such a scheme works at all is if few people adopt it.
There are plenty of places other than homes that use electricity, and not all can be net producers of electricity during the day–they just don’t have sufficient roof space. This includes most factories, server farms, smelters (especially for aluminum), hospitals, offices (the ones that are still in use), stores, etc. Oh, and Bitcoin miners :).
Biden has just signed an executive order that will encourage all Federal agencies to set up renewable energy auctions to do exactly that.
They will look at their annual electricity usage and set up contracts with intermittent generators to supply approximately that amount over a year. All output is locked in at the contract price no matter when it occurs.
You state, “the utilities would place no value on daytime electricity generated by the end users (really they would probably just cut off at the sources i.e. cease buying power”.
Nope. The utilities in Cali are required to pay the average annual retail price. A dime for something they can’t sell for a penny. (Solar farms aren’t owned by the utilities, they’re owned by investment firms). It’s not a hoax, it’s outright fraud IMHO.
Presumably the electric company normally buys electricity from generators at wholesale and sells it to customers at retail, the difference covering their operating costs and profits. Do you sell your excess back to the supplier at retail, the same as you pay for it? If so, you buy $1 of electricity in the night and return it for $1 in the day you have effectively received an interest-free loan. Not only that, the company can only re-sell your electricity at the price they purchased from you, in effect you have sold your electricity to another customer using the electric company as an unpaid intermediary (who has attendant overhead costs). Every customer that takes this up is a customer lost in profit terms, even if they covered their share of grid overheads the electric company is losing the paying customers that are funding the whole scheme, those remaining are also buying less electricity each from the company because they are getting it in part from solar customer/suppliers. Unless they pay you the wholesale price of electricity, plus charge a realistic fee for grid maintenence, it looks like a system that will collapse if too many customers take it up.
this is precisely why CA is choosing to end net-metering as-we-know-it so that the excess solar is sold back at a wholesale price that is yet to be determined, but I’d guess it will be substantially less than the wholesale rate of the grid scale generators. The buck that Tom is getting will likely drop to a fraction of a cent.
That’s what should happen, but so far it’s just a recommendation to the legislature. If they do that, they’ll do something else to “offset it”, that’ll just make matters worse. Cali is a one party liberal State.
Whoa, I’m sure no accountant could ever figure out how to deal with that!
I could buy batteries so that I never need to take power from the grid, but as long as there is net metering, there would be no point to this. Batteries make a little more sense if you have an EV, but still not economical. None of it is economical, really.
After several weeks of operation, I collected some data on the system and made this diagram. This is December, so there isn’t enough sun to cover the average demand.
What voltage you are talking about ?
The residential supply voltage here is 220 vac. The solar panel breaker is 30 amp, and sits in the breaker panel along with all the others. You’d never know what was for if it wasn’t labeled. The main is 200 amp.
The arrow between House and net metering box should point the other way.
For the period in question, the arrow is in the right direction. However, there are other times when it would be the other way.
If the grid supplied a net of 119kWh and the solar 399kWh, hasn’t the house consumption been 518kWh?
These are the panels I have ($246 ea): Mission Solar MSE345SX5T 345W Panel All-Black | Webo Solar
“I have a low interest loan ($32k)”
I paid cash for my house. It was a foreclosure sale. Unlike the previous owner, the bank can not take my house because of an unplanned misfortune.
Sure I have had house and car loans but I never risked losing my home hoping to ‘break even’.
Not everyone is as wealthy as you.
What is the term of the loan?
If I figure 15 years (typical life of home solar installation), and a 3% APR on $32K, then the numbers are $221/month payment, so ~$40,000 in a total of 180 payments with $7,777 of that paid as interest.
In 15 years, you’ll have to replace the system and start over if you want to keep on solar.
$221/month x 12 months = $2,652/yr. That’s more than my anuual electric bill (with a large pool consuming about $70/month in electricity for the filter pump).
What you cannot solely consider is your yearly average demand. You must consider your peak demand when you’ll be pulling electricity from the grid and what you’ll pay for that on top of your monthly loan payment. That additional electricity of course would come on top of the fixed $221/month loan payment.
The other huge issue in your plan is if you ever get an EV (or forced to get an EV is more likely) and how and when you’d charge that thing. You won’t charge an EV at night with your $32K solar array. If you charge it during the day, you have nothing for the house.
You’ve done a fine job but as you know the reality of renewables are far far worse than you layout if some thought is put into it , especially regarding compulsory EV by at least 2030 and certainly by 2050 (total ban on FF s) The math is so obvious and ridiculous and so very rarely done by these twits! Wind and solar will just NOT DO IT for many very very expensive and impractical reasons . Ultimately as we all know and have done for years Nuclear , Fission and hopefully Fusion , is the only way for the future.
“consumers pay for the electricity they do use, and they also pay for the electricity they don’t use,”
The definition of insanity.
No wonder Griff understands SFA about supply and demand!
It’s also the definition of forced selling which is illegal in most EU countries…
“”you will buy what I produce whether you need it or not and whether you like it or not”!
This is the end goal:
Australians with rooftop solar panels could soon be charged for exporting power into the grid, under proposed changes
I can’t wait to see what happens with EVs. Obviously owners paying a highway fee will surface to cover the lost fuel tax revenue. Then we will see the most progressive cities turn toward “night economies” so workers vehicles can be charged during the day when there is a surfeit of renewable power to spare. And on an on it will go….
Renewables aren’t dead.
They just smell that way.
Rooftop solar has a powerful lobby effort with Dems. How powerful? 1) It can even get them to drop tariffs on rooftop solar panels made with components derived from slave labor. 2) It can get them to look the other way with subsidies being applied to rooftop solar applications at 4x the LCOE cost of utility scale solar. Both are disgusting.
It is evident that some people have a problem understanding the folly of net metering. Here is an easy way to make it self evident. Just bring it to an extreme case.
Utopiaville is a town of 100,000 private homes with no industry. Seeing the cost advantages, they ALL put solar panels on their roofs and wind up with a zero electric bill at the end of the month.
Who is left to support the electric company that supplies power at night and maintains the grid.
That’s called the fallacy of composition and it’s Econ101. Econ101a then talks about dumping.
Where is the fallacy of composition? In CA the government has mandated that *ALL* new homes will have solar panels. Sooner or later that will force older homes to go with solar panels as well as grid electricity costs soar. It’s actually almost like an inverse tragedy of the commons. As it gets cheaper and cheaper to use private property as compared to the commons, the maintenance of the commons eventually fades away. Do you let the commons just disappear or tax everyone for its maintenance?
Just because “everybody” will not adopt net metering solar that does not change the fact that it’s true costs are being subsidized the general public and that as more people adopt net metering costs to those who do not increase proportionally.
Golly, I bet no one ever thought of communities that are all homes and no industry, and the fact that they’re not connected to any larger electric grid.
BTW, where is the generator in Utopiaville? The one that supplies their electricity at night.
The simple economic fact is rooftop solar owners should use it themselves or lose it rather than engage in state sponsored dumping. The most economic way to do that is storage hot water with a solar diverter- Energy Efficient | Power Diverter Australia Pty Ltd | Australia
If the premise is also fitted with a smart meter that allows any excess fed into the grid IF required then and only then should a FIT be applied at its true wholesale value. The current reward system for dumping is inequitable and defies all economic rationale.
One advantage of solar to the utility is that its peak output is during the day when demand is also going to be peaking. It might allow them to avoid or defer capital outlays for new generation capacity.
That is incorrect Tom, demand peaks in the evening whereas generation peaks at noon, this is the base of the problem so i’m not sure how you missed that. there have been many posts on that
Where I live, in the summer, the peak demand is in the afternoon, so for me the peak solar is not that far from the peak demand. That’s what I was thinking anyway. And, of course, the July peak demand is much higher than the January peak demand, which in the evening.
The exception to that pattern is the summertime in Texas. Here, because of air conditioning demand, the peak demand is about 3 p.m., while peak generation is about 1 p.m.
That’s fine Tom PROVIDED the grid wants your guaranteed frequency and voltage power when the smart meter that you paid for allows it and you receive its true wholesale worth. The problem for starters is your inverter is reactive and not proactive with FCAS so your system like all the others is bludging typically off coal gas and nuke generation in that regard.
That could be fixed by you installing battery storage but you know perfectly well that’s utterly uneconomic and if you did you’d have none spare to sell anyway. Besides if the grid needs to go solar and batteries to change the climate (I don’t make that mindboggle up) then large scale solar and batteries is where it’s at just like we don’t all have home generators with fossil fuels.
And there’s the whole story. if someone wants solar then they have a right to buy it and use it but without any subsidies or mandates. It’s of no concern to Mother Nature, she could care less, it won’t effect her climate “adjustments” one way or the other.
Intermittent energy is NEVER required. It is a blight on any dispatchable network that inevitably increase cost.
There are very few networks where intermittent generation adds value. They have the illusion of value that most people are lured by.
On the other hand government fiddling has incentivised the illusion and is the only choice for pragmatists in many locations.
Net metering is also a great way for the private home owners to suck $$$ away from renters. I love it when the poor are made to subsidize the rich by government programs.
Just beat me by seconds to making this point. If the less wealthy were ever to become educated enough to realize what their Progressive betters were really doing to them…
Which explains why to install socialism, it is necessary to first take over the education system.
“Net metering is also a great way for the private home owners to suck $$$ away from renters. I love it when the poor are made to subsidize the rich by government programs.”
Government programs supported by the democrats – the supposed champions of the poor. But then the poor are just tools to the democrats, they don’t have any money to feed political campaigns.
Nope just have to keep giving them enough OTM to keep them voting their way.
oops meant OPM (other people’s money)
Lower income earners get money from the government through a suite of programs so they’ll vote liberal no matter how much wind, solar, batteries, and EV’s increase their power bills. This RE blight isn’t going away. Terrible for the economy, but nothing that can’t be handled by increasing the National Debt (a very short little bit longer) IMHO.
I installed integrated solar panels in 2006 in northern California. The investment did not pencil out then but I thought I would benefit from a rising dividend as electricity rates rose.
Last month our house used 568 kilowatt hours. We have a two-tiered rate with a break point at 500 KWH. The bill for electricity was $56.
What the article leaves out is the fixed cost I pay for access to electricity. Every month we pay a “Basic Service Charge” of $26, in addition to the variable costs for actual electricity usage.
What would your bill be without the solar?
Bait and switch and everyone should have seen this coming. So now batteries are being touted because in reality rooftop solar hasn’t displaced the increase in grid electricity use through population growth because daytime use of electricity when the panels are active is low in homes and EVs are charged at night. Now what’s the payback time when batteries will be lucky to go 10 years before needing replacement? Just guessing…… 20 years on PV panels, two sets of batteries during that time, plus normal upkeep/maintenance costs, plus grid attachments fees and taxes, and add reduced to no reverse generation payback. I’m guessing there is just barely a break even point for the consumer.
There’s never been and never will be a break even point for the consumer, if the comparison is with grid power sourced from reliable power sources without any government subsidies and meddling. The consumer will just pay, pay, pay while the rich who have money laying around to “invest” in government sponsored boondoggles like wind and solar “power” rake in government manufactured “income” via transfer from the suckers, er, consumers.
There are so many variants of net metering that any discussion of the subject is bound to bog down in confusion. My comments here apply only to California and the city of Azusa’s electrical utility.
Much of California’s rooftop solar growth has been fueled by the net-metering system, which allows solar customers to sell the excess electricity they don’t use back to the grid at a pretty generous value, the same retail rate they are charged for their home electricity.
I think this is incorrect. I have before me my electric bill from 29 October to 30 November of last year, which, serendipitously shows that I returned to the grid exactly the same number of KWhs that I drew from it (198), for a net usage of 0. So my monthly bill should be 0, right? Well, no.
There are other charges:
State energy tax: .06
Electric users tax: .40
Public benefit charge: .80
Power cost adjustment: 4.21
Flat monthly fee, “Customer charge”: 5.80
These charges are based on the power I drew from the grid, and are not reduced by the fact that I returned an equivalent amount, which the utility sold at retail rates to my neighbors.
In California, net metering is subject to annual “true up,” I think starting with the date the system was first connected. I have the option of paying my monthly bills as they come in, or waiting for the next true up. These (one-way) “other” charges don’t go away until they are paid, either by my check or by any power that the utility actually pays me for. That payment occurs at the true-up.
I have here the city’s true-up statement for last June, which reads in part:
The annual true-up for your account is the only period that the account is eligible for the credit balance to be refunded. If you elect to receive a mailed check for the credit balance of -$1.99 please contact our office….
A note on the bottom of the monthly bill tells me what I want to know: You…have been credited $19.20 for net energy produced. Dividing $19.20 by 176, I find that the city is paying me 10.9c per KWh. Which is the city’s retail rate. But they are not refunding the power cost adjustments, which have been deducted from the credit balance.
I leave it to others to figure out who actually gets the power cost adjustment and whether it’s fair for the city to keep it when the power has been returned to the grid and sold at full retail to other users
I guess the taxes and perhaps the ‘public benefit charge’ (whatever that is) go to the state authorities and are not kept by the electric company. The other items have to cover infrastructure maitenence, I have no idea how the amount charged compares to that needed for such. Domestic generation reduces the gross income of the company but some overheads are fixed, they need to be covered regardless of the number of customers, so I guess that as more customers go for domestic solar, the more these costs will have to rise per customer.
Flat monthly fee, “Customer charge”: 5.80
Is $5.80 enough to pay capital and maintenance costs for the grid you’re still tied to? Probably not.
I tend to agree with probably not. However I’m not sure. The largest capital and mutaintenance costs lie with the generation and cross country transmission, and those costs are already baked into the KWh rate charged to Azusa Light & Power, which is passed on to me. Azusa Light has about 17,000 customers with varying rates for different classes of users. It appears that most residential accounts pay the $5.80, but some commercial pay more. I’ve got other things to do today beside working through the various user classes to get an exact figure, but it looks to me like the income to the utility would exceed a million dollars a year. How big a dent this would make in local grid maintenance costs, I can’t say.
But electricity billing is a puzzlement. As I remarked above, the city seems to have paid me the full retail value of the net surplus I provided. But we also find this on the city’s web site:
Net Generator Payment Amount Effective July 1, 2021 thru June 30, 2022:
Net Generator Payment per kWh: $0.0690
This is well below the current retail rate.
What you’re saying is the utility is paying you a dime/kwh and selling it to your neighbors for a dime. How long can they stay in business with that business model? Time of day and time of year pricing makes the electricity you’re providing worth more like a penny/kwh
You have to be careful what you write here. If people don’t like it they will try to minus you to death.
Heh. “Hold my beer” if you really wanna see some downvotes …
Let’s look at the latest projected component costs for a 150 kW (150,000 Watt) Hydrino-reactor based SunCell-operating-principle generator.
This unit would be suitable for powering 5 homes with 125 A 240V service at 30 kW each with more ‘peak’ power available intermittently since most heavy loads (excepting maybe electric heat) don’t run continuously:
Solar does not save carbon. It creates carbon mining, manufacturing and installing the panels, electronics and batteries.
Only if the entire process uses solar energy do you save carbon. In the meanwhile we are increasing carbon pollution via solar, using subsidies to hide the faulty carbon accounting.
Are you considering the life cycle total electrical production of the solar panels?
are you aware how little electricity they actually produce?
a grounding lug for a single panel costs $5. that’s 2 months of the electric value it will produce.
Arizona is prime rooftop solar country. It doesn’t get any better in the US than Tucson AZ for solar where I have a decent size home (2,730 sf) and swimming pool. Plus, putting a solar array on the roof is a major hassle with my flat, built up roof that needs a fresh reflective coating applied every 5 years. You basically have pay an electrican $2,000 to remove and then re-install the array panels every time (5 years or so) the roof needs to get recoated. That extra charge in itself destroys the cost of solar electricity economics of a rooftop solar for my home. I do have plenty of open ground cover on my half acre lot to put the rooftop array not on the roof but on a separate elevated ground mount, but that elevated mount would be a major cost I’d have to front. All in all, totally not worth it.
Tucson Electric (TEP) installed smart meters some dozen years ago on all homes and rolled out several customer select-able programs of ‘Demand Time of Use‘ that varies how much each Kwh costs depending on the time of day and, which varies across the heating and cooling year, i.e. summer (May-Sept) and winter (October-April). TEP tried mightily to encourage customers take that varying price plans so they would not have to keep building out fossil fuel generating capacity to cover the peak demands of early evenings in the summer when the demand is high and solar power is zero. On-peak and off-peak usage for customers enrolled in Demand Time of Use rates also vary depending on the season.
From the TEP description:
So the on-peak times are changing by season and if you are on this varying plan and inadvertently forget and use a lot of electricity (like have the audacity to run your home’s A/C from 3pm to 7pm in June, July and August) during your on-peak period of 3pm to 7pm, you get hammered on the monthly bill. The Power supply on-peak charge is currently $0.0594 per kWh, and the off-peak charge is $0.0235 per kWh in the Demand Time of Use program, more than double. While in the basic plan (the I’m on) there is only one Power supply charge rate of $0.0320 per kWh in the summer period. TEP is in the business to sell electricty at a profit for its share holders, and losing money is clearly not in this plan structure.
I rejected them all after I did a hard cost analysis of my own on how much I’d save versus the hassle of constantly changing when I use electricity on heat and A/C thermostats and pool pump motor. It was paltry savings at best, may be $5/month because they apply and would only happen if I carefully managed when I used electricity throughout the day, and would necessitate changing the pool pump schedule several times during the year. Any oversight on my opart of forgetting to change the pool pump schedule or deciding to keep my house cooler during higher rate periods would cost me dearly. I decided the the few dollars it might save each month wasn’t worth the hassle and constantly worrying about when I was using electricity and adjust the thermostats program times accordingly.
Thanks for sharing your experience and reasoning. My late mom had a house in Sierra Vista (Sulpher Springs Coop territory). About 8 years ago, based on what seems a good experience in our California residence, we paid to install solar on her house. I think it was a good deal economically, but only over a long period of time. Our panels (Sunpower) do not seem to have noticeably degraded in the last 10 years, so I am optimistic about the overall benefit.
But I do have a question about your roofing. Our Sierra Vista house has a composition roof (not shingles) that got ripped up by a really big wind a few years ago. I suspect it may be the same type of roof you have. The current repaired roof is now protected by the panels themselves, and also shaded by them. It seems to me that there would be no reason to put fresh reflective coatings under the panels. So how would your figures come out if it didn’t include that $2K maintenance cost every 5 years?
Have you ever done a roof recoating? or watched workers applying it? I wouldn’t even consider allowing the roof to be recoated without first removing the $20,000 solar array (if I had one, I don’t).
The coating will always start incurring shrinkage cracking at some point due to temperatures and the rain water standing under the panels are issues, along with the multiple support penetrations through the roof to support the panel structure, all of which have to be sealed- resealed. A leak you do not want.
These lightly sloped, flat-top, composite roofs are basic designs from the 1950’s thru mid-1970’s, long before anyone considered the engineering and maintenance issues of putting a solar array on them. They work quite well if used as they were intended.
We live on a boat and we have two electrical systems, 110V and 12, so we pay for power from the grid through the marina shore power. I have converted the boat to an inverter system. The shore power is 30a, 110v. Normally this would be connected directly to the 110 system through a panel. Now the shore power is connected directly to a small panel for heavy draw usage, shop vac etc, and to the battery charger. The battery bank runs through an inverter which supplies 110 to all the plugs in the boat and also supplies 12v for lighting, instrumentation and such. Were I to add wind or solar to this system it would go directly to the batteries reducing the draw on shore power by the battery charger, no power would be fed back into the grid. Even without installing solar etc our electricity bills have gone down.
Solar PV in a salt water marine environment is quite harsh on the service life of the panels and their supporting structure, a structure that has to be storm/wind capable. You might be better to put a small wind turbine up on a mast. At least it could operate a night too.
My boat atually has the system you describe. Two 120w solar panels, one 150w windmill, a solar controller connected to 4 golf cart batteries which are the main source of ship service 12v loads.
Also, a 6.5kw diesel genset, using diesel from the main engine tank, with a starting battery, a high output alternator on the main engine with a smart voltage retulator to charge the main engine starting battery, the house loads battery, and the bow thruster/anchor windlass battery up forward. Total of 7 batteries on one 43 ft boat. An inverter to make 110v AC from the house batteries, a battery charger to charge everything if plugged into shore power, and a bunch of separate switches, relays, automatic battery combiners, an exhaust fan for the battery compartment, and an ENORMOUS amount of wiring.
On a cruising boat, it makes sense, if you are sailing offshore or to far away places. But my wife has no idea how to make it work properly, so when I die I don’t know what she is going to do with it.
Oh, and I have an extra connection to feedback from the boat back into my house (the boat is parked behind the house, in Florida), so that if we lose power to the house, I can run the genset and power some equipment inside the house.
“..dollar-for-dollar federal tax credit for 26 percent of the cost…”
That would a 100% tax credit.
You spend one dollar, you get one dollar. Dollar for dollar. I hand someone a dollar. I get a dollar.
Virginia will now be exiting RGGI, which is the scam of buying and selling carbon credits, which various states along the east coast into the northeast have idiotically signed onto. It in part helps pay for things like solar and wind projects, and the cost gets passed onto ratepayers. With any luck, they will start a trend. Ratepayers are getting taken to the cleaners all for the sake of Big Green, and for uber virtue signaling.
COST SHIFTING IS THE NAME OF THE GAME REGARDING WIND AND SOLAR
Regarding wind and solar, cost shifting is rarely mentioned, identified or quantified. Those costs, as c/kWh, could be quantified, but it is politically expedient, using various, often far-fetched reasons, to charge them to:
– Directly to ratepayers, via electric rate schedules, and/or added taxes, fees and surcharges on electric bills
– Directly to taxpayers, such as carbon taxes, user fees and surcharges.
– Directly to federal and state budgets and debts
Per Economics 101, no cost ever disappears.
Eventually, the various shifted wind and solar costs, plus direct and indirect wind and solar subsidies, would increase the prices of energy and of other goods and services.
Efficiency and productivity improvements elsewhere in the energy sector, and other sectors of the economy, may partially, or completely, offset such increases.
However, wind and solar subsidies would divert capital from other sectors of the economy, which likely would result in fewer improvements in efficiency and productivity in these sectors.
LIFECYCLE COST ANALYSIS OF EXISTING AND NE ELECTRICITY SOURCES
This report uses publicly available data to estimate the average levelized cost of electricity from existing generation resources (LCOE-Existing), as compared to the levelized cost of electricity from new generation resources (LCOE-New) that might replace them.
The additional information provided by LCOE-Existing presents a more complete picture of the generation choices available to the electric utility industry, policymakers, regulators and consumers.
Existing coal-fired power plants can generate electricity at an average LCOE of $41 per megawatt-hour, whereas the LCOE of a new coal plant, operating at a similar duty cycle, would be $71 per MWh.
Similarly, existing combined-cycle gas power plants (CCGTs) can generate electricity at an average LCOE of $36 per MWh, whereas the LCOE of a new CCGT gas plant would be $50 per MWh.
Non-dispatchable wind and solar impose a cost on the dispatchable generators which are required to remain in service for peaking, filling in and balancing, 24/7/365, to ensure reliable electricity service.
Non-dispatchable means the output of wind and solar depends on factors beyond our control (the wind blowing and the sun shining) and cannot be relied upon for peaking, filling in and balancing.
Wind and solar increase the LCOE of dispatchable resources by reducing their utilization rates without reducing their fixed costs, resulting in a levelized fixed cost increase, i.e., higher c/kWh.
This report estimates the “imposed cost” of wind generation at about $24 per MWh, or 2.4 c/kWh, if CCGT gas generation performs the peaking, filling in and balancing.
The CCGT plants compensate for the erratic outputs of wind and solar by inefficiently ramping up and down their outputs at part load, and inefficiently making more frequent starts and stops.
All that decreases annual production of CCGT plants, adversely affects their economic viability, increases Btu/kWh and CO2/kWh, and increases wear and tear, all at no cost to the wind and solar multi-millionaires.
This report estimates the “imposed cost” of wind generation at about $24 per MWh, or 2.4 c/kWh, if CCGT gas generation performs the peaking, filling in and balancing.
This report estimates the “imposed cost” of solar generation at about $21 per MWh, or 2.1 c/kWh, if CCGT gas generation performs the peaking, filling in and balancing.
As a result, existing coal ($41), CCGT gas ($36), nuclear ($33) and hydro ($38) are less than half the cost of new wind ($90) or new PV solar ($88.7), if imposed costs were included.
NOTE: The imposed cost on ratepayers and taxpayers of various direct and indirect wind and solar subsidies are an entirely separate issue.
HIGH COSTS OF WIND, SOLAR, AND BATTERY SYSTEMS IN US NORTHEAST
Any transition from fossil fuels to low-CO2 sources, such as wind, solar, nuclear, hydro and biomass, could occur only when the low-CO2 sources are: 1) abundantly available everywhere, and 2) at low-cost, say 5 to 6 c/kWh, wholesale, and 3) as reliable as fossil fuels, 24/7/365, year after year.
This article presents the all-in cost of wind, solar and battery systems in the US Northeast.
Table 1 shows the all-in cost of wind and solar are much greater than reported by the Media, etc.
Much of the cost is shifted from Owners of these systems to taxpayers and ratepayers, and added to government debts
MINIMUM ANNUAL CARRYING COST OF ANY ENERGY SYSTEM
Simplified Mortgage Method
This method can be applied to Electric Vehicles, Heat Pumps, Electric Buses, Wind Systems, Solar Systems, Battery Systems, etc.
The minimum annual carrying cost of a house, or an energy system, is “paying the mortgage”.
With regard to a house, all other costs, such as real estate taxes, heating, cooling, maintenance, etc., are in addition.
An energy system must have annual revenues = “Paying the mortgage” + “All other costs”
Any shortage of revenues must be made up by subsidies.
The less an energy system is able to “pay for itself”, the more the subsidies.
Subsidies can be reductions in the upfront turnkey capital costs
Subsidies can be reductions of some items of “All other costs”
Subsidies can be paying for the electricity production in excess of market prices
A house, after paying the mortgage, likely is worth more than in Year 1.
However, wind, solar, and battery systems have useful service lives of about 20, 25, and 15 years, respectively.
Thereafter, they still perform at lesser outputs for some time, but their financial value is near zero.
Complicated Spreadsheet Method
A more exact analysis of the economics of an energy system would involve a spreadsheet with many rows and at least 25 columns (for solar), one for each year. It would involve Present Values, Internal Rates of Return, Levelized Costs of Energy, etc.
GMP, VT-DPS, VT-PUC, etc., have such spreadsheets, as do I. They would be much too complicated to present here.
Cost Shifting from Owners to Ratepayers and Taxpayers
It all gets cost shifted away from the unreliables and added to the poor folks service charges-
Synchronous condensers to lift constraints on renewables in South Australia – pv magazine International (pv-magazine.com)
It’s the great lie the climate changers promulgate with solar and wind and why that correlation large penetration has with expensive power bills.
Thanks, Observa, I read your Synchronous link, but no mention of cost. Do you have data or even a personal guesstimate? Could be fun shooting holes in the 1gw plan:
System strength-boosting syncons, batteries to super-soak up peak variable renewable generation, and judicious network upgrades are also being combined in Victoria as a more flexible alternative to massive investment in transmission and distribution networks. In May, Victorian distribution provider Powercor announced a plan to position 16 syncons, 20 batteries adjacent to substations in its network
This is not new ! get rid of all the “tricks” and “incentives” , do some basic math and financial projections and solar is laid bare ! It used to be ludicrous ! now It’s just extremely marginal which is useless for the future (maintenance, replacement ,disposal ,upgrading ,endless! And no matter what the price of installation will come down to , does anyone really believe that local government or federal for that matter is going to allow every Tom Dick and Harry to make significant profit on your installation without taxing it in some way ?
“BloombergNEF estimates that with the new rules, the payback period for solar-plus-storage will decline to six years by 2027, down from eight years now.” Don’t know where they go their numbers, the payback in In Arizona is 16 years. on second though when you electricity cost three times as much as Arizona the payback would be shorter. I live in Arizona and the payback figures even at sixteen years is in la la land. Even worse I had some idiot call me trying to sell me solar telling me I would only use the power I produced I ask him why he lied since the power I produced has to be use at that point and time, it not stored and since the sun does not shine 24/7 where does that other power I use come from. The idiot had no clue of was just a lair.
I have a 7.32kW system in North Phoenix – comparing the first year costs with solar to the last year without solar, and taking away the solar payment, I saved $800/year. Part of it is attributable to the solar array, the other is the PID controller that limits the current draw and cycles the power to each 4 ton air conditioner. Once the system is paid for, I will save about $3k year as compared to not having solar.
System was around $30k but that included some roofing work, $9k was subsidized. Without the incentive, it’s a non-starter.
APS has ON peak (3pm to 8pm) summer rate of $0.08615/kWh and Off peak of $0.05146.
However APS has a multiplier for max kW used during any peak time during the month that is punitive. I’ve set the controller to 5.5kW max – so as the solar panel output decreases, and it’s still not yet 8pm, the house will warm by a few degrees, but still comfortable when it’s 115F outside.
APS pays $0.09045 kWh for the excess power sold to them.
Last month I used 504kWh and sold 428kWh – bill was $40. The list of charges, fees, taxes is fairly long. For me, it’s working out, because it’s sunny 300 days a year here.
Just my $.02 – hope someone finds it useful.
An instant paid up $30K annuity at 5% yields $1500/yr ($125/mo),That’s what keeps me from putting solar panels on my brand new roof…one little leak…
The interest rate is less than that 3% and the length is only 12 years.
Start digging Califorlorny-
Renewable: Lithium promises revival for dying California inland sea (msn.com)
The price of lithium was $6,000/tonne just over a year ago. Now it’s above $43,000/tonne. What price batteries? Are they economic?