SolarCity Will Eliminate Over 550 Job Due to State’s Anti-Rooftop Solar Decision
solarthermalmagazine.com
solarthermalmagazine.com
http://www.marketwatch.com/story/is-this-sunny-state-trying-...
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A little-understood billing mechanism called net metering is at the heart of the Nevada controversy.
Net metering means that residential and commercial solar customers are billed for their “net” energy consumption. They are allowed to send back to the grid the electricity their solar arrays generate when the supply outstrips demand -- such as during daytime hours, in the case of a home -- and take power from the grid when demand may exceed the system’s output -- such as at nighttime when all the lights are on, or during a cloudy spell.
It’s a system usually based on power-bill credits. How that quid-pro-quo works, varies from state to state and from utility to utility. In Nevada, the utility regulators have decided to pay lower, wholesale prices for that surplus power, not the higher, retail prices they had been paying.
California utility regulators evaluated a similar proposal, but decided against major changes. In Hawaii, regulators approved lower net metering rates, but not higher fees for the most part. Arizona and Wisconsin have imposed higher monthly surcharges for solar customers.
More worrying in Nevada’s case, however, is that regulators made no provision to grandfather in existing customers, said Shayle Kann, a senior vice president at GTM Research, a green-energy consulting firm.
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By removing the incentive for customers to cooperate with the utilities, the utility companies are further incentivizing the installation of residential battery storage, which will further reduce the utilities' influence down the road.
Residential battery storage is just one component is a complex chain that needs to be deployed for every house that could be off the grid, it actually side-steps the need for net metering (because you can simply store your own excess). For those use cases the grid functions exactly like a battery, only one with near infinite capacity.
It also serves as a back-up, in case of system failure, extended lack of power from whatever sources you've got and so on. And that function is far harder to engineer around than the mere energy storage and recovery one.
There is an alternative to this, the equivalent of a credit union but for power where a number of people band together to do their own little grid, but the complexities and dangers involved make this a very difficult thing, especially once you factor in insurance and approval.
Here in the US the NEC says that anything under 50V isn't really regulated because they don't want to get involved in people's path lighting, phone, ethernet, doorbells, thermostats, garage door opener signaling, etc.
The other thing that will help enable going completely off grid are things like inverter AC units (which draw a continuously small amount of power instead of 5 minutes at 3kw and 10-30 minutes at 0kw) and ice "batteries" to store power instead of lead acid or lithium. Ice batteries never really go bad either, at least not the way chemical batteries do.
50V was a fairly arbitrary voltage deemed to be 'safe', however there are cases known of people dying from 50V and even lower (in particular, one very nasty accident involving a Swiss ham in pre-internet times).
A bus made of thick copper wire would be stolen here pretty much on the day that you installed it (copper theft is on the order of the day).
I'm not convinced of the need to have any of this though, I got my power usage down to the point where a fair sized house ran year round from 16 solar panels and a small windmill. The year that we only had the solar panels we still needed the genset with some regularity but the year the windmill went up we used it only twice (when I was running a 12KW plasma cutter from the battery pack they tended to deplete a bit too quickly...).
Not doubting them at all. It's just that I have some experience with burying high current / high voltage cabling and keeping such installations safe.
> Granted, it's harder to steal copper wire that is at 240 V.
Just use VMVK, armored version if you can get it. I got a whole pile of it that was left over after a large construction job on a dam in Canada. Paid pennies on the dollar, basically I just paid the copper market price.
Copper doesn't have these draw-backs which is why it is used a lot more on the 'low power' side of things.
But for the transmission lines the reduced weight more than offsets all the other issues, those are very well taken care of connections with resistances in the milli-Ohms, an expensive connector is not an issue when it comes to power infrastructure.
I'm not saying this is a panacea BTW, just that it might be easier and cheaper for a few neighbors to band together in this kind of a way than for everyone to overbuild their battery banks. If you can go from needing to have 10kW peak of batteries and can instead get down to 5kW peak since you can borrow peak capacity that means your bank can be half as large.
I don't know if you still need to pay the taxes if you're not grid connected though?
I've never lived anywhere where I used zero kWh for the month, so I'm not sure... but I have to imagine the cost would be pretty slow... save for getting such a system setup (transfer switches are common enough with backup generator situations so I can't imagine that portion would be very expensive)
Generac is pretty good and they have NG/LPG 'native' models.
It's one of the more sneaky tricks pulled in order to extract more money from people that have managed to successfully reduce their consumption. After all if you paid just a per KWh and per cubic meter price for electricity and gas then your efforts to conserve energy would pay off much more than with the fixed base cost for the hookup.
Short term thinking at its best.
(the not at all rugged township I used to live in had it in their planning documents that there would not be natural gas lines run -- they want to discourage development)
1) https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=W...
How are panels + battery not as reliable ? I think you mean they don't last as long, right ? As in, theoretically you could use up the battery before the sun rises again so it's not as nice as the utility ...
As far as I can tell, panels + battery (properly sized, and admittedly expensive) are all you need. You can just cancel your electric service at that point.
So you install either a wind generator, a genset or both.
> As far as I can tell, panels + battery (properly sized, and admittedly expensive) are all you need.
In some locations this may be true, in most it isn't.
> You can just cancel your electric service at that point.
As soon as you have backup power you can do that anyway.
I might not like the decision, but I am glad to see they aren't grandfathering in anyone. Grandfathering is a definitive unleveling of the field. People/businesses shouldn't be given special treatment just because they have been around longer than others. I feel for those who made investments and haven't seen them come to fruition, but that's politics. Deal with it at the ballot box.
If we take the OP at face value, then, it seems to be declaring that solar energy is completely impractical, and can't survive without life support.
I realize that other forms of energy generation are all subsidized in various ways, so it's clearly not as serious as my above interpretation, but still, it doesn't speak well of solar.
So you need something to do with excess capacity. All by itself, units of power aren't all that expensive. But a solar installation is very expensive. You need to amortize the cost of the installation, the people putting it in, the company developing the technology, over around 30 years before it's really worth it.
Even then, normal consumers won't bother unless it's actually making their net energy expenditures lower. So you also need a finance company to come in and finance everything so the consumer isn't coming out of pocket for the installation.
All of this is viable, only so long as the power companies are paying retail rates for excess electricity. There's enough money so everyone gets paid. What this is all about is the power companies are suddenly deciding they want to pay wholesale for excess power. Why should they pay wholesale? They're not buying in wholesale quantities from each consumer.
This sucks enough profit potential from the industry that it makes more sense for them to go elsewhere to put together a workable business model than to stick around and deal with decimated revenues.
The power companies are using their political muscle to stamp out competition. If they were to play fair, then they'd be forced to compete with solar. They don't want to compete, so they're using lobbyists to warp the political process.
Why should they pay retail? As a consumer thinking about solar, I like that, but it makes no economical sense. What business can afford to buy and sell for the same price? You don't sell a car to the dealership for the price they will sell it for. That would be absurd.
My guess is that they're going to compromise at around 75% of the difference between retail and wholesale. Nobody, except the power companies, really wants to see solar disappear, so the solar side is going to have more political might in this fight.
If they are forced to buy the uncontrollably variable distributed solar energy, it will be at the expense of the peaking plant, and possibly even the baseload plant, if there is a large enough gap between peak solar production and peak energy consumption.
So it should pay, at most, the price it would have otherwise paid from the power plants if distributed small-time solar installations weren't forcing their excess production back onto the grid.
That means paying less than wholesale. So those solar installations end up paying a bit for the service of using the grid a like a storage battery--as they should.
If you're going to demand equal compensation for your solar power as the peaking power plant, you will have to install equipment on your end that allows the grid to control how much power it chooses to buy from you. Otherwise, it's like haggling over the price of a meal that is already eaten.
Locally operated municipal utilities, however, are less likely to be turning a profit, at least not one that benefits shareholders.
Edit: clarifications
I get all of my energy from a roof top solar system but to stay on the grid I have to pay a connection fee which in my mind covers transmission costs and infrastructure. Being that it's a utility I can see them charging for that stuff, some how, either by a fee or by arbitrage between wholesale and retail costs, that seems reasonable. It radically changes the value of solar though.
If you can sell energy at wholesale prices what's the argument for restricting your ability to buy it at wholesale? Could you buy it from a different provider and just use the utility to transmit it?
Obviously under completely free-market conditions, they wouldn't. But under those conditions, power companies would burn nothing but coal and nobody would have any solar. Coal is really cheap. Retail net metering is society actively meddling with the free market to mitigate a societal ill, and forcing big polluters to subsidize cleaner energy. I don't see a problem with that.
From my dominion bill:
Distribution Service 15.73$ followed by "Electricity Supply Svc (ESS)" which is based on usage and then several fees/taxes.
Your phone bill probably does the same thing if your regularly calling other countries your paying a connection fee plus a usage fee.
>>So you need something to do with excess capacity.
The simplest solution is to push it onto the grid. With net metering you can get the energy back later at not cost. It's like using the grid as a battery.
The alternative of course is to up the installation cost a bit and install an actual battery system in the home. Much like those available from Juicebox:
http://www.juiceboxsolar.com/home/
So this whole thing about net metering is really just delaying the problem the power companies are experiencing. Hardware prices will continue to fall, and at some point the solar installation plus battery will cost the same as today's installation and the demand will return.
At that point we're likely to see some fees just for connecting to the grid. And after that, we'll see larger batteries and more panels so that people can unplug from the grid completely.
That's effectively making the power company pay retail.
There is an additional charge for consumers, for 'electric grid distribution' charge. This distorts the symmetry of net metering. The result is that a grid company makes money even at retail prices.
The power companies (normally) have enough power to supply everyone; they buy that power at wholesale prices and sell it to the customer at retail prices. So why, if they can always buy power at wholesale prices, should they deliberately pay retail prices instead? Doing so increases their costs, which then potentially raises rates for others.
So, asking power companies to buy power back at retail rates amounts to having power customers pay to subsidize the solar power generated by other power customers.
Looking at it as a subsidy, though, suggests a useful way to bring it about. Many power companies have a program where you can pay extra per kWh for "green" power, paying for the use of wind, solar, geothermal, hydroelectric, and other renewable zero-pollution power sources. Why not use a program like that to allow customers to subsidize solar power if they want to, and use the resulting funds to pay customers higher-than-wholesale rates for solar power?
And in that same case, the power company is out some infrastructure and maintenance costs.
But either way, you state that as though power grids have some fundamental property that necessitates the same rates for purchase and sale, a property that most other exchanges do not have.
As I understand my bill, PG&E still bills you for that as a separate item.
> But either way, you state that as though power grids have some fundamental property that necessitates the same rates for purchase and sale, a property that most other exchanges do not have.
That property would be "legal monopoly".
Even markets with a legal monopoly have a bid-ask spread.
No. It is paid at the same retail rate that consumers pay. However, because the amount paid is low, the retail rate used is tier 0, which is basically a lifeline rate. But it still isn't wholesale.
The pay-out on the true-up statement is very clear about the 3.xx cent rate.
Our first year we didn't go negative so we had a payment to make at the end of the year. Now that I know the return rate is so low I'll try to stay positive, switching some appliances to electric if I have to.
So there's the whole story. They do not refund your credit balance at the end of the year.
Rates: http://www.pge.com/en/myhome/saveenergymoney/plans/tiers/ind...?
People that drive 'green' cars are inherently rewarded with paying few taxes at the pump, because they are buying less fuel. Though they may be using the roads and travel infrastructure (which are partially funded by gas taxes) as much as 'non-green' drivers..is this fair for all? Not really, but imagine the fallout of charging Prius drivers more per gallon in order to increase their contribution to the infrastructure that they're using.
In many places, people using solar energy ARE charged more per kilowatt, for the exact scenario above--Increase their contribution to the infrastructure they're using--which is the opposite of what you proposed.
In your proposal to punish the folks that haven't jumped on the solar power band wagon--who receives the benefit$ of their 'punishments'?
More than one jurisdiction has actually attempted a hybrid/electric surcharge with that exact purported justification: http://abcnews.go.com/Business/nc-lawmakers-propose-50-100-f...
The money collected from the punishments can be used wherever is needed. Maybe to partially fund the roads, thus benefiting users of roads with lower tolls. Maybe to support free health and education, thus benefiting everyone.
I realise that might sound "crazy" because lots of well paid PR people are telling you the opposite, but it's true.
The generation is distributed, which saves on distribution and transmission costs.
Planning for expansion is also based on peak loads, which as noted above, solar reduces saving yet more money.
There's some worked examples for Minesota here:
https://www.nrel.gov/tech_deployment/state_local_governments...
It is worse. Wholesale prices vary during the day. If you force them to buy at average price at times when wholesale prices are low and sell at average price when they are high. That will cost them money, potentially lots of it (nowadays, wholesale prices can go negative when there is a lot of supply from wind or solar farms)
By paying wholesale when you have excess yet charging retail when you don't they are effectively charging you _their_ profit margin on _your_ own electricity.
Solar customers already pay the grid maintenance charges. Even if we assumed the utilities were entitled to some compensation for providing this service to solar customers it certainly wouldn't be the spread between wholesale and retail rates.
That is ANCIENT Solar Technology. If you care to read this it actually is
Energy payback estimates for rooftop PV systems are 4, 3, 2, and 1 years: 4 years for systems using current multicrystalline-silicon PV modules, 3 years for current thin-film modules, 2 years for anticipated multicrystalline modules, and 1 year for anticipated thin-film modules
http://www.nrel.gov/docs/fy04osti/35489.pdf
I think you need to re-research solar technology.
Companies like SolarCity can make the math more complicated. And in all fairness they can probably take advantage of various breaks and subsidies I may not have access to as a consumer. However, it's like a car purchase. I'm skeptical that some lease agreement suddenly makes a purchase sensible that wouldn't be with a straightforward cash on the barrel buy.
Doesn't the Tesla home battery change all of that ? Solar on the roof and one or two Tesla batteries in the house and ... no grid usage whatsoever, correct ?
The cheapest power to generate is the base load - long running gas, nuclear, coal, whatever. These are plants that take days or weeks to spin up and down and produce the most cost effective, efficient power. Since supply on the grid must exactly meet, always, these efficient plants can only be used to provide the base load - the amount of load below which the grid never drops.
Any power required beyond the base load comes from generation designed to be used periodically. It's not as efficient. There are stages to this too - you can have generators which take hours to come up which are more efficient than those which take minutes.
Residential power generation can cause the base load to drop, and require more peak load generation, increasing the production cost of power.
The power which customers generate must also go through transformers, rectifiers, and all that good stuff to be usable by others, and that equipment isn't free either.
Whether the company buys in wholesale quantities doesn't really matter, since the costs incurred from supporting residential net-metering aren't zero. It makes sense that they pay less for power they buy than what the sell, otherwise, that cost is shifted to someone else.
As long as it is always above your household needs it would still be OK, but that's not the case, is it?
Build a smaller, energy efficient house, get lots of batteries, and stop wasting so much electricity.
You also don't have to go 100% solar all at once. You can get panels and kits off of Amazon or from Home Depot and incrementally add capacity. Actually I believe with current prices and so many individuals out there that you can hire to help do installs now, at this point you should start small and go incremental rather than getting a loan. Otherwise you are wasting money, and just feeding into the racket that solar installers have set up.
Your information is outdated.
I defy you to find a low-margin business that can actually survive a ten-fold reduction of per-sale revenue.
You have to invest money to install solar panels; the expectation is that you can make that money back either by saving on running costs or by selling back electricity. If your running costs are projected to be the same (not worse, the same) and selling back is not profitable, then the fixed installation costs make the investment overall unprofitable, and the industry dies.
Unless they have to, power companies are not going to buy your excess solar power from you at all. So yes, regulation is required to prevent monopoly (or oligopoly) providers from abusing their position.
The question is more like, why should I be in a privileged position related to these other suppliers, and why should I be able to freely exchange something cheap (off-peak, unpredictable power) for something expensive (peak, on-demand power)? This is of course assuming that my usage of the grid is fully accounted for in fees, otherwise there is a separate issue there.
Ultimately, since public utilities are not exactly an investor goldmine, this comes down to the question of how much other electricity consumers should spend to subsidize those with solar installations.
If solar had even a tenth the subsidies that coal and oil have gotten for the past decades, it'd be on every rooftop by now (especially the nice flat commercial rooftops) and we'd have as many concentrated-solar facilities as coal plants.
In any of these anti-solar positions about grid costs I've never seen a factual statement of what it actually costs the power providers.
How much power you typically use and when has almost no impact on how much grid connection costs. All that matters is the peak they must be able to deliver. That is why billing transfer together with consumption makes no sense.
They should be completely split into two bills paid to two different companies like in Finland.
I've yet to see any concrete numbers but I see a lot of justification of minimum fees using grid costs as the primary reason.
If these costs are so visible and important, why is it hard to find actual costs? Is it $2k per year per household? $400? $100? Does it match up with some of these $50/mo minimum fees?
This, however, is a myth (reinforced at every turn by the incumbent monopolies). Rooftop solar tends to overproduce on the hottest days, which also happens to be the time when the grid is overloaded by air conditioners running at full throttle. In effect, rooftop solar is at maximum production exactly when the grid needs it the most, thus providing very valuable demand smoothing. This greatly benefits utilities, since they don’t have to spend as much on peak-generation capacity.
There is ample evidence that utilities vastly underpay for these benefits [1], while their profits rapidly increase. Three major Nevada casino operators “have expressed vocal criticism of NV Energy for generating huge profits over the past years and not lowering rates for customers of Nevada Power. [...] NV Energy’s profits increased 27.7% in 2014, yet the supplier has not introduced any electricity rates breaks to its customers since it was acquired by Berkshire Hathaway.“ [2]
Over the short term, the incumbents will get their way by flexing their political muscle, but this will only delay the inevitable. Electricity spot prices are at their highest during daytime, while people are at work and their solar generators put power into the grid. Utilities will now pay wholesale for this power, then turn around and sell it to non-solar consumers at the top rate. People return from work as their solar generators become inactive, so they will have to buy power at retail rates. For now, utilities will win both ways.
But what this means is that as storage prices drop, it will be more economical to invest in storage capacity in order to capture the valuable power during the day and use it during the night. This will deny utilities the demand-smoothing services that they currently enjoy, so they will have to increase their capex for peak generation, leading to higher rates for everyone else, which in turn will encourage _more_ customers to install solar and storage, etc. Soon after, people will start disconnecting from the grid altogether; welcome to Uber Energy.
Tectonic plates move slowly, but they rearrange quickly.
[1] http://cleantechnica.com/2015/09/01/review-of-net-metering-s... [2] http://www.casinonewsdaily.com/2015/11/26/major-casino-opera...
Utilities are still buying back power, just at wholesale rates. You can still use the power yourself and buy less at retail rates. Or you can get some of Tesla's batteries and store it for nighttime use. If your solar panel output matches your air conditioning load, this shouldn't affect you.
For those who are not local, California is, of course, the high-population, high-employment, high-tax neighbor that sparsely populated mostly-desert Nevada likes to try to poach jobs from by claiming California is "anti-business".
Energy is the 5th most subsidized sector, counting both grants and tax expenditures (exemptions), with $34.5b in total federal subsidies. Compared to the $743.5b we subsidized healthcare, this is pretty small stuff.
Energy makes up the 2nd largest share of direct federal loans at $48.4b, behind education at $87.8b:
The energy sector contained the second largest number of loans, with $48.4 billion in loans, about half of the amount of education loans. These loans were administered by the U.S. Department of Energy to promote advanced technology vehicles and energy efficiency through innovative technologies and by the U.S. Department of Agriculture, for the purpose of improving electricity transmission in rural areas. The energy sector’s loans made up 31 percent of all loans in the nine sectors in FY2010.
Good breakdown of competed vs non-competed contracts by sector as well, with transportation and national defense coming out on top in terms of nominal size of contracts as well as ratio non-compete to compete, unsurprisingly.
It's the tacit approval of and ignorance towards externalities energy companies cause, mostly pollution in any number of forms, from those carcinogenic to those crushing the climate (CO2) and finally things like nuclear waste (and possibly decontamination) that will be with us for many thousand years to come. These massive costs are not being accounted for, and they sum up to subsidies vastly exceeding the puny $50b cited here.
Not to mention the implicit subsidy of the rest of us picking up the tab for the damage they are doing to the environment.
If you're really curious there's tons of information out there.
No, I was genuinely curious.
The power supply curve from solar is going to correlate highly with the air-conditioning load that'll drive the peaks in Nevada. Peak shaving is a big business because the energy at the peak is (by far) the costliest to generate. Just a customer supplying their own household power from solar power will be saving the utility money at peaks, sharing the excess with nearby customers even more so.
You are of course correct that they wouldn't get this deal if they where unregulated. The way you say it might fool people into thinking that minus regulation a utility would be a great example of free market competition, rather than a Monopoly (or a Monopsony in this particular case). So I'm confused why you bring it up? That's like talking about a business deal and saying if this was a Mad Max style post-apocalytic wasteland then you wouldn't offer as much. Of course not, you'd just take it from them at the point of a gun. What does this say about its actually value though?
http://www.fool.com/investing/general/2014/04/18/what-i-lear...
http://marketrealist.com/2015/08/solarcitys-business-model-r...
It is actually unfortunate such an innovative company is seeing the negative effects of policy changes.
We don't need to sponsor the most economical form of energy, we need one that is renewable and does not pollute on a mammoth scale. This is more economic in the long-run.
Fixed fees can significantly affect the cost of solar and some reports have this fee as high as $40/month[1]. The fact that they have also made this retroactive to existing solar customers adds a lot of uncertainty to the market as well. That can't help from a sales perspective.
[1] http://cleantechnica.com/2015/12/28/nevada-solar-fee-retroac...
I've predicted rising fixed fees for solar customers before [1] and I think it's just the beginning. When a significant amount of households have a solar installation they're not really providing a service to the grid anymore. Everyone sends a lot of power into the grid when nobody else needs it during the day, and then wants power from the grid at night.
So what you're basically doing is using the grid as a giant battery. The grid doesn't really need your energy most of the time, but has high fixed costs to maintain the infrastructure. I think it's just fair that you pay them for this service. If you don't want it, you need to get off the grid and install your own batteries.
If having a bunch of household solar saves the power company from spinning up expensive peaking plants, you're saving them a ton of money and performing a great service.
Of course, if enough households have solar then you'll exceed what the system needs even at peak times. But we're so far away from that point that there's no reason to discuss it in the context of current policy.
The big question to me in this case is, when the power company buys back solar power at wholesale rates, are they paying average wholesale rates, or are they actually paying the marginal wholesale rates at the time in question? How well do their retail rates reflect their peak marginal costs?
In many places, residential rates can end up below cost at peak times, even with time of use metering. In a situation like that, switching from net metering to paying true wholesale rates could be a net gain for homeowners with solar. But I have a feeling the setup here is not quite so fair.
The ideal market for net metering is where the population is spread out and surrounded by mountains. That makes transmission tricky/expensive. Generation of power locally via small rigs bypasses those transmission difficulties, allowing the small provider to perhaps demand something higher than wholesale rates.
I still think the idea of local solar power is good idea but should still be done in larger sites. There are certainly more sites that much more optimal than individual homes. Set up a co-op system where you buy shares in the installation and derive benefits from it
The change isn't a ban on rooftop solar. It's a change in the metering for selling power back to the grid.
It's pretty rare that political corruption is this transparent. Normally at least some attempt is made to cloak it. In Nevada, this is apparently not necessary.
[1] http://www.reviewjournal.com/business/casinos-gaming/3-strip...
[2] http://www.reviewjournal.com/business/energy/casino-companie...
Lots of state rebates are starting to go away and utility companies are pulling back on credits.
We worked with over 50 solar companies in 2013 to 2014. It was a gold rush during that time. 2015 was a completely different story and I think 2016 will continue in that downward spiral.
Solar companies really need to figure out a way to survive without state & federal rebates and utility company credits.
EDIT: It behooves you to install a solar system on your dwelling sooner than later.
I get that it is a trade magazine, but wow... that is some sensationalism. It makes it sound like he is literally shutting down the industry, not just the rates that drove the market's rapid growth.
[1] http://www.greensunnj.com/resource/1430381659000/Bad_Princet...
[2] http://watchdog.org/212170/surprise-solar-liens/
[3] http://cleantechnica.com/2015/02/08/solar-shingles-renewable...
Rooftop owners that buy their systems outright are still im good shape, with a different payback period. Leases have been pushed bc theyre more lucrative for installers and homeowners have avoided the upfront cost of buying. Leases were a gateway financial model to expand rooftop solar but I think we'll see a shift to system ownership, which will reduce the impact of net metering. And it will be further reduced as storage tech ramps up.
[1] http://www.bloomberg.com/news/articles/2015-09-24/batteries-...
[2] http://rameznaam.com/2015/04/14/energy-storage-about-to-get-...
In the states where they investigated how much value was provided by the rooftop solar, the value was higher again than net metering (e.g. it might save money on uprating grid connection). This means Nevada was effectively taxing rooftop solar and wasn't getting the optimum amount installed. With this change they've raised that tax and destroyed even more value.
Another specific angle is the retro-activity, this means no consumer in the US can commit to rooftop solar without worrying that all their calculations will be rendered moot, after the install. This puts a big cloud over things.
It also doesn't make a lot of sense to me that they charge higher fees to connect to the grid.
Definitely seems like a big win, short term, for the power companies. It seems like a big lose for renewables. Everyone seems to focused on whether it's perfectly fair or not - whereas I would say the goal of getting to environmentally friendly energy must weigh into the discuss - but hey, that's me.
Side note: I would be curious how much grid maintenance costs the power companies relative to their other costs.
Effectively, they're deleting load from close to the end user from the utility's books. If that load hadn't been deleted, the utility would have charged retail pricing in order to generate it.
The small negative adjustment from retail would come from the fact that the utility is still servicing the solar user as a retail user. So still needs to charge a set amount for admin costs & transmission (NOT generation) infrastructure.
Paying them wholesale is pretty ridiculous, and is a blatant abuse of the fact that they're a monopoly enshrined in law. If the state decides that you can't sell your electricity to anyone else because they anoint a utility, then that utility should absolutely be banned from exploiting that position to compensate solar generation less than it could.
If utilities can't balance their long-term amortizations of recent/new plants, then the state government can step in an reimburse them over the top for the disruption.
Remember that capacity is sized for peak utilization: the gap between average load and peak is load is extremely expensive, as it's by definition low-utilization compared to base load generation.
Sure but they would have only paid to wholesale rate to generate the power.
It's like going to the gas station and trying to sell them gasoline at their retail price. Why would they do that when they buy it at a cheaper price from someone else.
This arbitrage shows that only crediting wholesale prices is the wrong price.
(disclaimer: I'm co-founder of the linked news site)
Where I live the electric energy company has separate rates for energy and for distribution. I think it's like that everywhere.
In the most naive pricing model net metering ignores that distinction and simply run the meter backwards when local production exceeds local consumption.
In the second most naive pricing model, the local customer would credit for energy cost, but not distribution, when local production exceeds consumption.
Neither of those are completely fair: the first doesn't gain the utility a return on their distribution infrastructure investment, and the second pays the utility too much. Why too much? Around here we pay a level distribution fee that covers both the long-haul lines from Georgian Bay and the shorter haul from the local coal plant. Locally generated electricity doesn't use the long-haul distribution system.
What's needed is a pricing model that ...
a) maintains incentives to build out new generation (rooftop, etc.)
b) makes incentives to create a new "smart grid" distribution system.
But naive models, in a world that can have companies like Enron disrupting those models, are also not good enough.
For example, naive net metering -- backward running meters -- is not as favorable to Tesla's battery business as a dual-rate system. The return on a battery investment needs to come from that margin.
When a utility adds wind and solar to their portfolio they also have to hire experts to analyze the weather. These experts need to estimate how much power the wind and solar are going to provide every day. There are times when entire wind farms are shut off because they will be generating too much power! There are other times when they are shut off because of concern that the weather could damage them. This is not easy.
Imagine adding tens of thousands of tiny solar arrays to your grid and then having no knowledge of how well they are going to operate. You can't possibly begin to estimate what the cloud cover is going to be like for all of these installations over your territory. You don't know how well they are maintained. You don't have any clue if they're kept clean. You might not have the infrastructure to accept electricity back into the grid (substation upgrades are not cheap).
The grid would gladly accept your power if they knew it was safe to do so. The fact is that it isn't. If too little power is generated, brownouts or blackouts occur. If too much is generated equipment is damaged and shit starts on fire.
What we need is a SMART grid. It does not exist yet. It will take many years. Large battery installations may be a good stop-gap. But to vilify the utilities is ignorance when you don't really understand how the grid works.
edit: I actually know of a giant private wind farm that was built on the idea that they could sell access to it back to a utility. Unfortunately it has been sitting dormant for a couple years because the cost to get the backhaul to the windfarm was too much, and the private investor had no idea the windfarm couldn't just be hooked up.
http://www.technologyreview.com/news/545146/battles-over-net...
I still have the impression that the incumbent monopolists (power companies) are protecting their interests at the expense of the public, not unlike taxi drivers blocking uber operations within a city.
I hope we get to a non monopolist system asap.
http://www.technologyreview.com/news/544471/renewable-energy...
Hopefully this will encourage energy storage systems. Using the grid that already has enough energy as virtual storage is a pretty shady way to enhance your business. If you cannot store energy yourself than accept that you are going to pay for someone else to do it for you.
I would also argue, if you do not take care of the externalities of your energy production yourself, than accept that you are going to have to subsidize people that are reducing the demand for it. Why is it on the solar owners to pay for all of their energy storage but not on the coal power plants to capture and store their CO2 emissions?
Because those are two separate issues. One has nothing to do with the other.
The story here is that a solar customer wants the government to force the power company to store his/her energy for them and the grid is not designed for that. The power company pays a wholesale rate to all its suppliers.
I see this as a push to get better storage technology developed which will benefit far more people. The solar company is being disingenuous and I bet there books are not quite as positive before this event as they let on.
I like home solar and will probably install it when I decide to buy a home, but I will install a storage system and a cut off so I can use my panels without the backfeed to the grid incase of power outage.
I think it is. That's not how businesses are supposed to operate (at the whim of the state's budget dole-outs)
Politicians need to be taught that they serve at the pleasure of the people, and when they stop doing what they are told, they will no longer be employed. Nevada has been one of the most pro-solar states in the US, and what he is doing is political suicide.
edit: woops that's what I get for skimming too fast, thanks :)
His Wikipedia page currently has one section which is a long hit piece written by pro-solar flacks, but that seems likely to be cleaned up as soon as other Wikipedia editors take notice. Other than that, I don’t see much evidence that he’s in any particular trouble.
“Political suicide” seems like a fairly dramatic exaggeration, unless you’re sitting on some information the rest of us don’t know about.
(Note: I think the Nevada Republican party is crazy, and am strongly pro-solar myself... but let’s not kid ourselves here.)
Edit: Sandoval’s statement about the SolarCity announcement, http://www.news3lv.com/media/lib/166/0/e/8/0e8f2127-0e76-464...
I have seen very little evidence that this is true, at least in the last 50 years or so. Sure, there are isolated recalls here and there, but the vast majority suffer no repercussions regardless of how they act.
A single vote every few years is a piss-poor way of making your voice heard, but it's what we have. The current state of affairs makes it seem clear that our system does not work well, regardless of what we were taught in Civics class.
I was under the impression that impeachment is not a "I didn't get my way, I'm going to remove you from office" card. It's not for validating the whims of the electorate because some of them think they're not being served. It's for bringing official charges to an elected official and putting them on trial. What charges can you file against the governor based on this short article and actually bring to trial?
You just entirely destroyed the EPA.
While in some sense that corresponds to the words I used (by which I mean, I see why you mention it as relevant), it definitely doesn't come close to applying here, as that is international law.
> would allow foreign corporations to sue the United States government for actions that undermine their investment “expectations” and hurt their business
http://www.nytimes.com/2015/03/26/business/trans-pacific-par...
Yeah, but there's probably bad consequences to it also.
https://www.fas.org/sgp/crs/misc/R42635.pdf
Additionally, states generally can't impair existing contracts through legislation due to the contracts clause.
See https://en.wikipedia.org/wiki/Contract_Clause (mainly because i'm too lazy to write it all up here).
I can't be the only one.