Should Solar PV owner be able to profit off selling excess power?

[nwdiver]

So, a 10kW system that will save at least $120/month from your electric bill, will now cost an extra $7/month. I'm not seeing where the sky is falling.

Do you guys not agree that PV customers should pay some kind of fee for grid use?

The initial proposal from APS was for $7/kW. That would have been disastrous. Fortunately some of the commission couldn't be bought so they settled on $0.70/kW. ANY fee on production OR capacity is idiotic. It discourages what we want (clean energy) and does little to address the 'problem' (grid payment imbalance). The only sensible plan is to replace net-metering with a Feed-in-Tarrif.

A FiT is likely to be even LESS appealing to utilities since it creates an economic incentive to use their product (the grid) even less through storage and demand response. With a FiT it's possible to avoid paying the utility by not doing what they say you should pay for doing... with a fee on Production or Capacity they get paid no matter how much or how little you use the grid; no wonder they love it so much! In NM we have a 'wonderful' rate structure where if I go on a month-long vacation in July I can save ~$50 by turning my PV system off before I leave.......... what sense does that make?!

This is only the beginning. PLEASE PLEASE PLEASE attend PUC public comment sessions...

http://www.renewableenergyworld.com...3/11/whos-winning-the-net-metering-debate-now

 

[Zythryn]

...
Do you guys not agree that PV customers should pay some kind of fee for grid use?

I am not sure about the billing structure in AZ.
My Utility in MN charges me a flat $11.50 for "basic service".

In my mind, that IS a fee for grid use.
I also get a net metering payment for excess solar credited to my account.
While that rate is about 10% higher than the retail rate, it actually falls short of the actual value of that energy, especially during peak hours.

These extra fees are simply a way to dissuade solar use.
The Koch brothers try to wrap it all up in reasonable sounding policies, but then push specifics that are outrageous.

 

[ItsNotAboutTheMoney]

So, a 10kW system that will save at least $120/month from your electric bill, will now cost an extra $7/month. I'm not seeing where the sky is falling.

Do you guys not agree that PV customers should pay some kind of fee for grid use?

I do agree because PV customers are customers. I agree that ALL customers should pay a fee for their grid use.

We know that the whole pricing system is messed up, and based on outdated assumptions. Like EV-specific fees in lieu of fuel taxes, the fee is a band aid to avoid the ramifications of fixing the pricing model. If the utilities don't want to fix the pricing model, it's because they know that accurate pricing would kill their opportunity for profit, because then they'd end up subject to competitive supply and a fixed/per A/per kW distribution charge which would be highly visible and tightly regulated.

 

[nwdiver]

I am not sure about the billing structure in AZ.
My Utility in MN charges me a flat $11.50 for "basic service".

In my mind, that IS a fee for grid use.

The 'basic service' fee is really meant to simply be an administrative fee... even with that net-metering is in no way sustainable long-term.... but neither are the capacity or production fees becoming popular with utilities. I go over this in my blog;

http://www.teslamotorsclub.com/entr...-reasons-Net-Metering-is-no-longer-our-friend

What's needed is simple... use the grid more you pay more; use the grid less you pay less. The amount of energy you produce with solar should be COMPLETELY irrelevant as far as your bill is concerned. Net-Metering MUST DIE.

 

[wycolo]

Basic to my design is that the new solar system *itself* will be off-grid. That simplifies things immensely, as I enumerated. However my house will retain its grid connections. If I need to charge a Tesla during a cloudy period I'll just plug it into the grid. I envision a lot of double-throw switches, or at least plugs and sockets. Again, with 11 cent kwhs from the grid, there is little financial incentive to grid tie. My interst is just to create the first stand-alone Tesla solar charging station for one or two cars, to see it working and to see how much of the winter months it can actually do some of the heavy EV lifting.

Sorry I did not make this clear upfront.
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[mknox]

We know that the whole pricing system is messed up, and based on outdated assumptions.

Exactly. And I'll get it out of the way up front that I am a VP at a Ontario, Canada electric utility.

While it's much more complex than this, electricity can be thought of as the commodity (the actual electricity produced by generators) and delivery (the cost of the poles, wires, meters and billing systems). Historically, the cost of both of these components have largely been recovered through variable charges (i.e. per kWh) along with a nominal monthly account fee or sometimes a minimum charge. That works great when the power flows in one direction.

The problem comes about with the delivery component in the new era of behind-the-meter generation and, to a certain extent, conservation initiatives. The cost for the utility to maintain all those poles, wires and other infrastructure has not changed, but the revenue based on volumetric charges has gone down. What do you do? There have been discussions around "standby charges" (after all, you want the grid power to be there if your solar system fails) or of fixed (not variable) connection charges leaving just the commodity as a variable (per kWh) component.

Neither of these is going to make the consumer very happy. It's easy to think that I've used less, so I should pay the utility less. Thinking of it in terms of the commodity (which you should pay less for) and the delivery (or connection) that really is the same regardless of how much power you purchase may help in the understanding of what's going on here.

If the commodity and delivery revenues both go down as a result of solar and other behind-the-meter generation, utilities are simply going to go to their regulators and ask for rate increases to make up for the lost revenue. The problem with that is consumers who do not have solar end up subsidizing those who do.

 

[NigelM]

^^ good post, but I going to argue with the concluding sentences:

If the commodity and delivery revenues both go down as a result of solar and other behind-the-meter generation, utilities are simply going to go to their regulators and ask for rate increases to make up for the lost revenue. The problem with that is consumers who do not have solar end up subsidizing those who do.

Power companies here in FL have run a series of incentive lotteries partially because of demands from legislators for "greener" production but also because of an expanding customer base (hello snowbirds!) which has caused the PoCos to be pushing up towards capacity levels. The step cost to increase production capacity is huge so it makes sense to try to ease the demand on the grid by incentivising (some) customers to install solar on a net metering contract. In this example I can realistically argue that my installing solar is helping keep rates down for those who don't.


(BTW, further to other comments up-thread in FL we have a monthly admin fee ~$8. Also, if I underproduce over the year I pay full rate per unit ~11c for the difference I draw from the grid, but if I over produce the PoCo only pays me ~4c per unit for my excess)

 

[Johann Koeber]

Here in Germany I pay 0.26 € per kWh. The surplus of my 30 kW garage solar system goes to the grid for 0.13 €.

So there is a huge incentive to use the energy on premises. To that end the three Tesla batteries (2 of them current, one on order) are my way to catch most of the electrons.

We are working on a circuit to prioritize charging the cars, second feeding the house and only any surplus going to the grid. But because my Tesla batteries do not allow use of the power in the house (only for driving), I still end up buying a lot of electricity. As soon as Tesla (or some other reputable source) offers batteries for my home needs, I will be all in.

Interestingly I am selling my power to another entity than the one I am buying my electricity from. The price I can sell electricity is regulated by the government.

 

[nwdiver]

Here in Germany I pay 0.26 € per kWh. The surplus of my 30 kW garage solar system goes to the grid for 0.13 €.

SEE?! What's so hard about this?.... this IS sustainable long-term... this is basically how the grid works in Texas... yes, Texas is more like Europe in this one case than places like California... Mind => Blown :scared:

 

[wycolo]

Planning a ground mounted system lets me dodge all the rooftop system restrictions. Whew!
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[wycolo]

> We are working on a circuit to prioritize charging the cars, second feeding the house and only any surplus going to the grid. [Johann Koeber]

Why bother going to the grid at all considering the extra circuitry, cost, regulations, billing issues etc? I'm guessing because you have already built your system and established the new contracts with the power companies. If you were back to step one (planning) would you do it differently today?
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[green1]

Not much different from here. Electricity purchased from the grid is at $0.15 (they claim $0.08, but that's not what the math says once you account for all the variable priced charges, and that still doesn't count any fixed charges) and you can sell back to the grid for $0.08
Worse yet, you sell back at peak demand times, and buy at low demand times, so they should be happy, but that's just not the case...

 

[nwdiver]

Why bother going to the grid at all considering the extra circuitry, cost, regulations, billing issues etc? I'm guessing because you have already built your system and established the new contracts with the power companies. If you were back to step one (planning) would you do it differently today?
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You're sending somewhat mixed messages.... so you're in favor of remaining tied to the grid for back-up but it's not worth exporting to? The equipment required to export is CHEAPER per kW than the equipment required to be off-grid... what am I missing?

 

[wycolo]

You're ahead of me, what with the parts lists and prices. This is what I'm intersted in seeing to compare the two systems.
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[mknox]

Power companies here in FL have run a series of incentive lotteries partially because of demands from legislators for "greener" production but also because of an expanding customer base (hello snowbirds!) which has caused the PoCos to be pushing up towards capacity levels. The step cost to increase production capacity is huge so it makes sense to try to ease the demand on the grid by incentivising (some) customers to install solar on a net metering contract. In this example I can realistically argue that my installing solar is helping keep rates down for those who don't.

Ontario has done something similar. Here, Feed in Tariffs for solar have been created to entice customers to install solar and be paid a significant amount above the wholesale cost of power for doing so. A much better deal than simple net metering for the customer. The problem is that Ontario utilities are not vertically integrated (generation, transmission and distribution are, by and large, handled by different entities). So while the FIT solar program addresses a generation capacity issue, it can create headaches for local distribution companies trying to accommodate these installations which are often installed at the "skinny end" of a distribution line. Further, the goal here in Ontario is to consider "green" before economics, so the difference between these FIT contract prices paid and the wholesale cost of power get dumped into a bucket and are "socialized" across all customers in the form of another line item on the bill (or, in some cases, hidden in the regulated cost of power rate). Also dumped into this bucket are the costs associated with an ambitious Conservation program, although it is easy to argue that capacity made available through conservation is cheaper than capacity through new build. One irony of this renewables strategy is that Ontario has had to beef up its fleet of gas peaker plants to deal with the irregularities inherent with renewables like wind and solar.

 

[Ampster]

Basic to my design is that the new solar system *itself* will be off-grid. That simplifies things immensely, as I enumerated........
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Maybe I didn't go back far enough in this thread, but I didn't see where you enumerated a simplified system. You will still need an inverter, but a different inverter than a grid tie inverter. So it will be almost the same as a gridtie system which has panels and an inverter. In my mind the complexity will come trying to match the panel output to the draw of the cars onboard charger.

 

[nwdiver]

You're ahead of me, what with the parts lists and prices. This is what I'm intersted in seeing to compare the two systems.
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Do you have your inverters yet? You're looking at Radians right? Do some research on AC coupling. Grid-Tie inverters are usually ~50% less than off-grid inverters and Radians are designed to play nice with them. If your goal is 64kW you could tie ~32kW of Grid-tie to ~32kW of off-grid. This would be cheaper AND give you the ability to export once your batteries are charged. The disadvantage is that you would 'only' have ~32kW available without peak sun but the grid can supplement in those rare events.... and 32KW is still A LOT of power. I don't think I could hit that charging my car @20kW AND turning on everything I own...

 

[Cosmacelf]

Ontario has done something similar. Here, Feed in Tariffs for solar have been created to entice customers to install solar and be paid a significant amount above the wholesale cost of power for doing so. A much better deal than simple net metering for the customer.

Hmm, here in California, it would seem that net metering would be a much better deal than feed in tarrifs. Net metering here works with time of use rates, so when the sun is shining you get a really good slice off your payments. Not sure how feed in tarrifs would be better...

 

[PeterW]

Do you guys not agree that PV customers should pay some kind of fee for grid use?

The answer to that question is NO.

All customers should pay a fee to maintain the grid (they do here), it should not matter if you have PV or not.

 

[mknox]

Hmm, here in California, it would seem that net metering would be a much better deal than feed in tarrifs. Net metering here works with time of use rates, so when the sun is shining you get a really good slice off your payments. Not sure how feed in tarrifs would be better...

Here's why: The commodity cost (exclusive of regulatory and delivery costs which are non-TOU based) are 7.7 cents/kWh off peak, 11.4 cents mid-peak and 14 cents on-peak. The Ontario microFIT rate (for renewable installation under 10 kW) is currently paid out at 38.4 cents/kWh.

So for every kWh you use during Peak, you pay 14 cents while for every kWh you generate, you're paid 38.4 cents.