Utility dream, bad news for solar or conservation

[Circus]

both We Energies and Alliant Energy asked state regulators Friday to reduce the amount they'll pay for customers' solar power, starting next year.
Madison Gas & Electric Co., this month sought permission to double its fixed charge in 2015, from $10.44 today to nearly $22 a month for a typical residential customer. Over time, the utility initially proposed to boost customers' non-energy charges to $68 by 2017

http://www.jsonline.com/business/gr...isconsin-utilities-b99295581z1-265066971.html

 

[Jags]

When local/home storage becomes a viable and cost effective solution I am going to get a small amount of satisfaction watching these folks wither and die on the vine.

 

[EatenByLimestone]

Home storage is viable now. People just have to decide not to use an average of 900 kilowatt hours each month. The lower the use age, the fewer panels and batteries that need to be bought.

 

[Slow1]

I'm not sure it is financially viable yet once you consider lifetime $/kwh. Paying the utility monthly to maintain the grid is still likely much less expensive than maintaining and periodically replacing batteries. Then again "viable" is perhaps subjective... Rather depends on other alternatives.

I do agree that reduction of monthly usage is the key - conservation is almost always less expensive than adding infrastructure (even if just "local" to the home). IF utilities go to a fixed monthly fee to connect to the grid, those who use less are going to find disconnecting more attractive. I was burning about $100/mo in power prior to solar - right now I have a fixed $4/mo cost to be connected so batteries clearly don't make sense. Raise that connect fee to $68 as being cited by OP and I'll be looking to see what I need to do to get batteries.

I do wonder - are these utilities cutting the $/kwh charges at the same time or are they simply increasing their cost to all? IF they reduce the marginal costs then this will almost certainly make adoption of grid-tied solar production less attractive.

 

[woodgeek]

IF they reduce the marginal costs then this will almost certainly make adoption of grid-tied solar production less attractive.

And that is likely the intent. Rather than adapt their business model to the new reality, they are seeking to insulate themselves from it and forestall the inevitable.

 

[jebatty]

The utilities are seeking a double whammy: by increasing the fixed charges the persons hurt the most are low income users, and the utility can argue that PV is hurting those least able to pay. Therefore, reduce the utility buy back rate and keep the fixed charges low, thus putting the $$ burden on those most able to buy PV. The strategy is perverse. Perhaps short term good for profits, long term hurts everyone, the utility included as the utility business model continues to collapse.

 

[Ehouse]

The next shoe waiting to drop is the "everyone pays" scenario. You can be off grid as far as energy usage but you'll still get the non-energy bill (now conveniently separated from the energy charges) if you live anywhere near a power line. I've seen reference to this having been written into energy regs. but I've been unable to find it again. I think it was at the state level here in NY.

 

[Circus]

Just another example of the corporate argument ignoring the benefits of the non centralized, peak output at peak demand and benign nature of solar. Maybe it's time to break up these powerful monopolies for the sake of national security, the common good and life on earth.

 

[sloeffle]

The next shoe waiting to drop is the "everyone pays" scenario. You can be off grid as far as energy usage but you'll still get the non-energy bill (now conveniently separated from the energy charges) if you live anywhere near a power line. I've seen reference to this having been written into energy regs. but I've been unable to find it again. I think it was at the state level here in NY.

I wonder how they are going to deal with the Amish in this type of scenario ? The Amish I know would probably tell the power company to shove it where the sun doesn't shine.

Scott

 

[woodgeek]

I wonder how they are going to deal with the Amish in this type of scenario ? The Amish I know would probably tell the power company to shove it where the sun doesn't shine.
Scott

If they tried that near me, I might have to decide that I'm Amish and demand an exemption!

 

[Seasoned Oak]

Gas and water Co is doing the same thing. All these companies have been increasing the fixed monthly cost to insulated themselves from market price fluctuations for fuel as well as people who like to conserve.

 

[begreen]

This is not untypical in states that have a majority of their power generated by coal or oil. It is an organized effort by these industries with heavy lobbying to keep their vested interests alive. Florida, where solar should be king is a prime example of this practice. Corporations are often better represented by these congresses than the will of people of the the state.

"John Porter, the former mayor of Cape Canaveral and the managing partner of the solar energy company CleanFootprint, said Workman, R-Melbourne, and others in the Legislature oppose the amendment because voters would likely approve it.

"Nothing polls over 90 percent (among voters), but solar does," he said. "If the people of Florida are given a choice in this issue, they are going to vote yes. … They understand how valuable it is to their air, their water and to the future of Florida."

http://www.tampabay.com/news/busine...-solar-power-blocked-in-florida-house/2173065
http://www.latimes.com/nation/la-na-no-solar-20140810-story.html#page=1

 

[CaptSpiff]

Isn't the discussion in the southwest to add a simple fixed fee ($20 to $60/mo) to the electric bill of any PV customer to cover the cost of "maintaining" the existing T&D infrastructure? The argument being that those PV customers will periodically need that infrastructure capacity, and otherwise only the remaining non-PV customers would get stuck paying for it.

On a tangent, my power co used to place a "power limiter" on the house meter pan if you were severely late on your payments. It consisted of a 20 amp per leg breaker that fit between the pan & meter, preventing the homeowner from using more than about 5Kw at any one time. If it popped, the homeowner would need to walk outside to his meter and reset (press back in) the popped breaker.

Perhaps the future will allow PV customers this option, rather than to go completely off grid, and thereby forego the "fixed PV monthly charge". I think that argument could win because those customers would not need the present & expensive "robust/overbuilt" T&D infrastructure.

 

[begreen]

I had a couple meetings with our regional power company as the WA state solar initiative plan was coming together. They were very supportive for a couple reasons. The first was because there is one remaining coal plant in WA state and it is being phased out in about 10 years. New power plants are very expensive. And the second was the increase in electric cars. They are very concerned about having enough power for charging cars in the state 10-20 yrs for now. If nothing else, WA states rapid embracing of solar buys them time.

 

[woodgeek]

Isn't the discussion in the southwest to add a simple fixed fee ($20 to $60/mo) to the electric bill of any PV customer to cover the cost of "maintaining" the existing T&D infrastructure? The argument being that those PV customers will periodically need that infrastructure capacity, and otherwise only the remaining non-PV customers would get stuck paying for it.

The higher fixed rates are for ALL customers, not just PV.

The power a residential PV array pushes into the grid all gets used by your immediate neighbors, and the utility is getting paid full retail by the neighbors for the power you put in, without straining the long distance transmission of the utility, or its transformers at all. The only utility equipment being used is 100' of low voltage wire and a couple power meters.

So, the true value/price of the solar power would be slightly less than the average retail rate during the day. Since wholesale power prices peak during sunny days, this is above the residential retail rate they are currently getting under most net-metering arrangements. IOW, distribution companies are making money on existing net meter arrangements and low PV penetration. Generation companies are selling slightly less power, but at the same price as before.

The worry is all about the future when the time of use rates get inverted by big solar, which renders a lot of the utilities generation capacity stranded and a lot less profitable. This is not about 'PV owners not paying for the transmission grid they use', it is about utilities making bad investments in non-throttle-able generation equipment, and now wanting us to bail them out.

 

[Where2]

Nice to see someone understands how the system is "rigged", thank you WG. I recognize most days of the week my neighbors purchase my excess from the power company at full retail rate paying T&D fees for the energy that moved all the way from my roof to their A/C or refrigerator.

My retired parents are fed off the same neighborhood transformer as my PV system feeds into. My excess energy isn't getting stepped up and shipped across town, it's getting used in my neighborhood, probably by the retired folks down the street who won't put in solar because it won't pay back in their lifetime (dad's own words as he helped me install my PV system).

 

[CaptSpiff]

Nice to see someone understands how the system is "rigged", thank you WG. I recognize most days of the week my neighbors purchase my excess from the power company at full retail rate paying T&D fees for the energy that moved all the way from my roof to their A/C or refrigerator.

Aren't you net metered, and getting a full retail price credit for each kw you send out?
If so, that seems like they are buying it from you at full retail.

I wish I had PV. Right now my power company is buying energy wholesale at 3.6 cents/kw, but my bills this year have averaged 10 cents for the energy portion.
(broken link removed to http://www.nyiso.com/public/markets_operations/market_data/maps/index.jsp)

I just dug up my two monthly bill sets, one for LI,NY and the other for Poconos, PA:
LI,NY: April: Meter Charge = $11/month, Delivery T&D = 10 cents/kwh, Generator Supply = 11 cents/kwh
Poconos,PA: April: Meter = $14/month, Delivery T&D = 4.1 cents/kwh, Generator Supply = 9.1 cents/kwh

I think we must be using gold wires on Long Island.

***EDIT: just 5 minutes after posting this i noticed that the wholesale price of energy jumped to 11.4 cents/kwh. Maybe I'll just leave that coaster ride to them and shut my mouth.

 

[Where2]

Aren't you net metered, and getting a full retail price credit for each kw you send out?
If so, that seems like they are buying it from you at full retail.

Yes, I am net metering, but I realize there is a drastic push away from net metering as evidenced by the Edison Institute's infomercial that tries to portray PV system owners who net meter as free riders who don't help pay to maintain the grid. I also have watched closely what the utilities have been doing in states where they have been challenging net metering.

My 4.4kW PV array only took out 66% of my home energy needs. I still have an electric bill, anywhere from 50-550kWh per month. I have automated energy hogs like my electric water heater to run during my peak PV output to use the most of my surplus. I usually only "net meter" 250-400kWh per month. I was limited to a 4.4kW array by the physical size of my southerly facing second floor roof. To utilize more PV, I'll have to dedicate space in the backyard for a ground mount system. The challenge for me is that a ground mount needs to be capable of surviving a 3-second gust of 160mph to get approval from my local building department. The cost of that mount system is substantial and begins to outweigh the fact that inverters and panels are pretty cheap these days.

The utilities have a method to charge net meter users for their grid tie use by simply looking at how many kWh each user sends to the grid every month. My single Landis & Gyr electric meter tracks "delivered" and "net" in one meter. If I'm generating more than my house needs, the meter adds to the "net" value. All the schemes I've heard to charge PV owners for the privilege of net metering seem to revolve around a ridiculous fixed monthly base charge which could potentially be higher than what I used to pay in T&D fees before I ever had a PV system.

 

[begreen]

Don't most electric utilities charge a flat fee regardless of usage for the first xxx KWh? Isn't that supposed to cover their fixed costs? This whole deal smells like someone burning Koch coal.

 

[jebatty]

Our utility has changed its marketing regarding the fixed monthly amount, currently $14/mo, recently raised from $12/mo. Now the marketing says that fixed and variable are balanced in some way to cover the costs of the electric service. I look at this as a move to protect profits by raising the guaranteed income stream as more and more customers go PV.

I live rural, and generally each residence is supplied from a separate transformer off what I believe to be a 2400v distribution line. That would mean my net metered PV is stepped up as it leaves my property and then again stepped down when it arrives at the neighbor. Regardless, I doubt that my net metered PV makes it even a mile before being used by neighbors, since none of my neighbors have any PV.

Different question: what portion of the grid is commercial/industrial vs homeowner? I would estimate that about 2/3 of electricity is to meet these non-residential needs. Therefore, shouldn't the bulk of the cost of the very high capacity and expensive grid should be paid by non-residential customers? On the other side is residential vs commercial/industrial distribution. What is the cost of providing and maintaining each?

 

[EatenByLimestone]

You mean, should the grid costs be charged to corporations which in turn pass the costs on to you?

They do.

 

[woodgeek]

Ok. In my PA market, we have a flat generation cost, a flat distribution cost and a fixed mo payment. Today, the fixed cost is $6/mo, the generation is 8-9 cents, and the distribution is 4 cents. You could argue that PV should only get paid for generation, 8-9 cents, since one is still 'using the grid' to sell PV electricity. I am arguing since my (hypothetical) power goes to my next-door neighbor, and they are paying the utility generation+distribution (and doing nothing to make that power and v little to deliver it 100') then they are basically 'even' if they pay me generation+distribution in my net-meter arrangement.

Realistically, the wholesale market price (for generation) varies with time of day, being most expensive during the day. Some utilities are just distributors, who are passing on a time average generation cost to customers. Any PV fed into the grid during the day, and bought back at night at the same price actually makes those distributor utilities a tidy profit, the difference in daytime and nighttime rates. OF course, generators are different....they have fixed and variable costs, which are packaged into those variable wholesale rates we don't see. A generator who built a lot of 'peakers' for daytime use, assuming they could charge a bundle for peak power (wholesale) are now SOL due to PV. Utilities with baseline generation (usually nukes) are currently selling power below cost at night and above cost during the day, and will lose money if peak daytime rates fall (until the nighttime rates get increased, as they will).

IOW, the current economics of solar have **nothing** to do with PV owners being 'free riders' on grid services. That's just easily understood propaganda. It has everything to do with PV power rocking the shaky boat of generator profitability, and that varies immensely with the specific choices that the different generators made over the last decade or more....some are well positioned to alter their business model, some others are totally screw-geed with huge sunk costs that look like they will be effectively stranded in a few more years.

 

[jebatty]

You mean, should the grid costs be charged to corporations which in turn pass the costs on to you?

Absolutely, yes. Failure to include costs in the production of a product distort the market and result in non-producers of the product paying that cost. The cost has to be paid by someone, and I see no reason why that cost should not be paid by the business that incurs the cost.

For example, if I choose to use walk for transportation, why through my electric rates should I be required to subsidize the electrical costs incurred by an auto factory? People who buy cars should pay those costs.

 

[Circus]

I see no reason why that cost should not be paid by the business that incurs the cost.

Ever wonder why white collar crime go's unpunished? It's difficult to do. Residental customers are easy targets.

 

[Seasoned Oak]

Don't most electric utilities charge a flat fee regardless of usage for the first xxx KWh? Isn't that supposed to cover their fixed costs? This whole deal smells like someone burning Koch coal.

My power CO (PP&L)was granted a major increase in fixed minimum bill charges last year. My bills went from about $8.50 a month minimum ch to around $16.50 before any charges for any usage was figured in. Pretty much a 100 percent increase. Gas and water utilities have been doing the same although a bit more gradually. Water is the worst cuz when you figure in the fixed sewer fee you will pay about $70.00 a month even if your usage is ZERO.