The quiet rise of solar power — and the financial problem that could arise

[Nice Squirrel]

So in other words a flat "grid tax".

In other words, pay for the service you are receiving.

Do you object to this principle or do you not understand that is what is being advocated?

I used 118 kwh last month. Should I pay the same amount as the industrial user?

According to my bill 56% is power plant (production costs) 9% high voltage lines cost 35% local wires.

Looks like I am already paying for infrastructure.

 

[Togo]

So, the simple way to solve this problem is to charge a fee to hook up to the grid, and then buy and sell energy on the grid like any other commodity, rather than having the cost of connection and maintenance buried in the cost of energy.

Why are people so worked up about something that can be solved by accountants?

Because it would be an awful lot of accountants. A household with rooftop solar may become efficient enough to produce more electricity that it consumes, but it produces only during the day, and consumes at least some energy at night. The cost of a few large providers doing this on the interchange level or switching on or off on the scale of entire power plants is one thing, but tracking and switching for millions of households is more of a task. Really you need a technology solution, both for the tracking and the switching, and even then keeping track of everything is expensive.

It's not impossible, but it's not particularly easy either.

 

[dx713]

So, the simple way to solve this problem is to charge a fee to hook up to the grid, and then buy and sell energy on the grid like any other commodity, rather than having the cost of connection and maintenance buried in the cost of energy.

Why are people so worked up about something that can be solved by accountants?

Because it would be an awful lot of accountants. A household with rooftop solar may become efficient enough to produce more electricity that it consumes, but it produces only during the day, and consumes at least some energy at night. The cost of a few large providers doing this on the interchange level or switching on or off on the scale of entire power plants is one thing, but tracking and switching for millions of households is more of a task. Really you need a technology solution, both for the tracking and the switching, and even then keeping track of everything is expensive.

It's not impossible, but it's not particularly easy either.

You don't need an exact solution.
Just estimate infrastructure costs for an area, and split the invoice into two parts: one (fixed) infrastructure part, depending on the max draw you subscribed for, and one consumption part.
That's how we do it here, and have been doing it for a long time, well before automated metering. So it mustn't be that complicated.

 

[dismal]

In other words, pay for the service you are receiving.

Do you object to this principle or do you not understand that is what is being advocated?

I used 118 kwh last month. Should I pay the same amount as the industrial user?

According to my bill 56% is power plant (production costs) 9% high voltage lines cost 35% local wires.

Looks like I am already paying for infrastructure.

You should probably pay more. The wholesale cost of producing the energy is the same for both. You are probably more expensive to connect to the grid on a per kwh basis.

 

[dismal]

Because it would be an awful lot of accountants. A household with rooftop solar may become efficient enough to produce more electricity that it consumes, but it produces only during the day, and consumes at least some energy at night. The cost of a few large providers doing this on the interchange level or switching on or off on the scale of entire power plants is one thing, but tracking and switching for millions of households is more of a task. Really you need a technology solution, both for the tracking and the switching, and even then keeping track of everything is expensive.

It's not impossible, but it's not particularly easy either.

You don't need an exact solution.
Just estimate infrastructure costs for an area, and split the invoice into two parts: one (fixed) infrastructure part, depending on the max draw you subscribed for, and one consumption part.
That's how we do it here, and have been doing it for a long time, well before automated metering. So it mustn't be that complicated.

You don't need real time metering to solve this particular problem. You need real time metering to solve the problem that energy is far more costly to produce at certain times (peak hours) of the day/week.

 

[ksen]

Why is it more costly to produce at certain times? A kwH is a kwH isn't it?

 

[Nice Squirrel]

I used 118 kwh last month. Should I pay the same amount as the industrial user?

According to my bill 56% is power plant (production costs) 9% high voltage lines cost 35% local wires.

Looks like I am already paying for infrastructure.

You should probably pay more. The wholesale cost of producing the energy is the same for both. You are probably more expensive to connect to the grid on a per kwh basis.

Exactly, my bill should be at least $250/mo instead of the measly $25 just because I use less energy.

 

[Jason Harvestdancer]

Libertarians ignoring corporate welfare? Since when?

I said you guys don't ignore it.

Actually I see what you did there. You took a group that is very vocal about it, lumped it in with a group that is not vocal about it, and noticed that the aggregate group isn't very vocal about it.

It would be as if I said "ksen and conservatives aren't very vocal about it."

Technically your point is true. Technically mine would be as well.

 

[ksen]

jesus, see if I stick up for you again.

 

[Jimmy Higgins]

I used 118 kwh last month. Should I pay the same amount as the industrial user?

According to my bill 56% is power plant (production costs) 9% high voltage lines cost 35% local wires.

Looks like I am already paying for infrastructure.

You should probably pay more.

There you have it. The problem isn't that we aren't paying specifically for the infrastructure, the bills are already doing that. It is that dismal doesn't think we are paying enough.

 

[Sarpedon]

Why is it more costly to produce at certain times? A kwH is a kwH isn't it?

Its not so much that the production cost is different: its that the demand is different at certain times. A kwh is more in demand if the hour in question is 7:00-8:00pm rather than 2:00-3:00am. I saw an article recently that new batteries using molten metal might finally provide economical storage at a large scale, which would make this less of a problem.

 

[Jimmy Higgins]

I said you guys don't ignore it.

Actually I see what you did there. You took a group that is very vocal about it, lumped it in with a group that is not vocal about it, and noticed that the aggregate group isn't very vocal about it.

It would be as if I said "ksen and conservatives aren't very vocal about it."

Technically your point is true. Technically mine would be as well.

I'll take post fails for $400 Alex.

That isn't what ksen said at all.

 

[SimpleDon]

This is the problem with solar and wind power, they are intermittant sources of power and require 100% back up when the sun doesn't shine and the wind doesn't blow. As there gets to be more of it the utilities will have to recover their investment in their generation stations in the demand charge.

Solar is better than wind in that it better tracks with demand. I.e. there is much more demand during the day than at night and AC loads are higher on sunny days. But backup and storage are still going to be needed.
Large flow batteries operated by utilities (paid for by grid fee and spread on buying/selling power) or solar hydrogen generation (for example by using the new perovskite cells) are two possible solutions to the intermittency/storage problem.

I have now seven solar panels on my backyard roof and plans for four more. That will be over 7 kW of panels. But I have no storage batteries specifically for the solar panels. The DC current from the panels is converted by a surprisingly efficient set of invertors into the 120 VAC current that is used in the house. Any load in the house that is on at the time will consume it. If there isn't enough loads to consume the solar power it goes onto the grid running my meter backwards. At night I consume power from the grid.

My panels are pointed to about 145° or about 35° to the east from due South. This gives them a morning to early afternoon bias, when here in the South you would prefer a peak generation in the mid to late afternoon. I want to put four panels on the roof of my garage that is aimed to the southwest and pitched well enough for afternoon, summer sun. But Mrs. Simple doesn't want the panels on the roof where they can be seen a little from the street above our side entry garage. But only a little bit. From the side. (I am practicing my arguments to her here.)

 

[Loren Pechtel]

The state regulates the utility industry. What it can charge, whom it must serve.

The problem with solar is that the largely fixed cost of constructing and maintaining grid is currently amortized across units of power sold. People who maintain a grid connection but don't consume power are exploiting the model. They are free riding.

The common-sensical non-ideological solution to this would be to have a fixed grid charge and a variable power charge that is more in line with the marginal cost of power. If someone want to completely disconnect from the grid they can avoid the grid charge.

It's actually worse than that. Not only are they free riding on the grid but they are placing an unreasonable load on the production facilities.

The problem is that solar (and wind, although that's normally not something generated at home) power is erratic. The sun goes behind a cloud, your power drops and you draw from the grid instead. That means the grid must quickly ramp up the power production to match.

The only generators capable of such quick ramp-ups are oil and natural gas--the most expensive sources of power.


Furthermore, in Hawaii they're facing another problem that has caused the utilities to forbid any new grid-tied solar in many areas. Due to the fact the fuel must be shipped in power is expensive there which has led to very high solar penetration. The grid was designed to distribute power from the plants to the people, not the other way around. When you have one solar house on the wire that's feeding power to the neighbor's non-solar house the grid doesn't care. When you have a bunch of solar houses on the wire that are pushing more than enough power for their non-solar neighbors you have a problem--while in theory a transformer is bidirectional it doesn't work so well when you're dealing with that high a power level. Not to mention one of the basic rules of electric design is that you have the safety device on the upstream side--but now the power is flowing backwards.

 

[Loren Pechtel]

The common-sensical non-ideological solution to this would be to have a fixed grid charge and a variable power charge that is more in line with the marginal cost of power. If someone want to completely disconnect from the grid they can avoid the grid charge.

Isn't there this charge for the gas utilities? You pay for the infrastructure (one fee) and you pay for the gas (another fee). Now that I think of it, I thought that was how my electric bill was chopped up too. IE, when you get these wonderful options to save oodles on the cost of electricity, it only applies to a very specific portion of the bill. Or is this all state by state?

The basic fee you see on your utility bills isn't the cost of the distribution network, it's the cost of maintaining an account--billing, payment, your meter, reading it etc. (Like the day they replaced our water meter with a fancier version--and failed to tighten a nut adequately. I ended up getting them to eat the $40 in water they dumped into the ground that way.)

 

[Loren Pechtel]

In other words, pay for the service you are receiving.

Do you object to this principle or do you not understand that is what is being advocated?

I used 118 kwh last month. Should I pay the same amount as the industrial user?

According to my bill 56% is power plant (production costs) 9% high voltage lines cost 35% local wires.

Looks like I am already paying for infrastructure.

But what happens when you put solar panels on your roof that generate 100 kwh?

You're paying for 18 kwh but you're using just as much high voltage line and local wire and a good portion of the powerplants. Your hypothetical solar panels take no peak demand at all off the grid, they only cut the fuel consumption at the powerplant.

 

[Nice Squirrel]

I used 118 kwh last month. Should I pay the same amount as the industrial user?

According to my bill 56% is power plant (production costs) 9% high voltage lines cost 35% local wires.

Looks like I am already paying for infrastructure.

But what happens when you put solar panels on your roof that generate 100 kwh?

You're paying for 18 kwh but you're using just as much high voltage line and local wire and a good portion of the powerplants. Your hypothetical solar panels take no peak demand at all off the grid, they only cut the fuel consumption at the powerplant.

It is in violation of my lease to place solar panels on the roof.

 

[Clivedurdle]

There are many comments here that are basically justifying the status quo, including discriminatory legal structures!

And there are fascinating storage possibilities - pumping water up hill as at Dinorwic, charging car batteries, and various salts.

If you need to change a business model it is very good idea to prepare for it, not avoid it!

 

[Jimmy Higgins]

Isn't there this charge for the gas utilities? You pay for the infrastructure (one fee) and you pay for the gas (another fee). Now that I think of it, I thought that was how my electric bill was chopped up too. IE, when you get these wonderful options to save oodles on the cost of electricity, it only applies to a very specific portion of the bill. Or is this all state by state?

The basic fee you see on your utility bills isn't the cost of the distribution network, it's the cost of maintaining an account--billing, payment, your meter, reading it etc. (Like the day they replaced our water meter with a fancier version--and failed to tighten a nut adequately. I ended up getting them to eat the $40 in water they dumped into the ground that way.)

Actually my bill says:

Basic service charge - ... covers the fixed cost for delivering gas, plus associated riders.

There is also a usage based charges, which is for "delivering gas to the meter".
And here is a bit more evidence to lump onto the pile.

Yet its fixed-system costs are about the same whether or not consumers buy gas. So the PUCO decided the utility ought to be collecting more revenue with fixed monthly charges and less with volume-based rates.

In an order that commissioners tinkered with until the last minute, the PUCO:
• Immediately increased Dominion's monthly service charge from $5.70 to $12.50 per month while decreasing the volume-based rate by about 59 cents per 1,000 cubic feet. That reduction lowers the total delivery rate, including taxes and special riders, from $2.90 per Mcf to about $2.31 per Mcf.
• Set a second increase in the monthly service charge in 2009, boosting it from $12.50 to $15.40, while decreasing the volume rate by about 27 cents more to about $2.04 per Mcf.

Ohio Edison is similar. There is a cost for the electricity, for the distribution, for the metering equipment and maintenance of the local line. Dominion's price is fixed, Ohio Edison is based on usage.

 

[Clivedurdle]

And on isnt a kwh price the same, this is the base load issue.

Production must cope with factory shifts starting in the morning, kettles going on, various peaks like breaks in the superbowl, and not needing much overnight. Economy 7 was introduced in UK for this.

What are needed are models that can cope with very significant fluctuations on both production and consumption sides.