Electric Utilities vs. Rooftop Solar
Here’s an article that suggests our power utilities don’t really want to see more rooftop solar. While that’s not really news to anyone, it certainly does raise a good question: what are the changes we need to make in our relationship with our utilities such that we, collectively as a society, keep our power prices low, while making sure we don’t cook our planet?
The answer lies in completely rethinking the mandate we give the utilities. 100 years ago, we said, sell us all the cheap and reliable power you can, and we’ll reward you with a defined profit. Now we have a new set of requests. (Can’t we reset the rules every century?)
At this point, we need to encourage anyone with a sunny roof to put solar on it. This means no pushback against net metering. The argument that this will raise prices for those for whom solar PV is not an option has merit, but there are lots of good ideas to implement here:
• Charge net-metering customers a lease fee for the service the grid provides, i.e., backup power.
• As load shifts more to daylight hours, more PV means less cost of building expensive peaker plants with dismally low capacity factors. Share that cost reduction with the people who can’t install solar and need to stay beholden to the utilities.
• As more solar is being used to charge electric vehicles, tax EV drivers. This is going to have to happen anyway, as the costs of building and maintaining road, which has historically been derived from taxes on gasoline and diesel, needs to come from somewhere. (In turn, pay EV drivers what they’re due if they participate in vehicle-to-grid programs, and provide power as required to facilitate voltage and wave-form correction.)
• Price in the externalities. Solar means less environmental damage and reduced healthcare costs. Electric transportation means less war, which, among its own catastrophic externalities, it comes with a U.S. military budget that’s approaching a trillion dollars per year. If we tax fossil fuel consumption and channel this back into keeping electricity prices low, everyone (but the power companies) wins.
We need to make this happen while there is still time.
From the original post:
“• As load shifts more to daylight hours, more PV means less cost of building expensive peaker plants with dismally low capacity factors. Share that cost reduction with the people who can’t install solar and need to stay beholden to the utilities.”
Would roof-top solar systems actually reduce the need for peaker plants?
The amount of cloudiness can change very quickly. It could be that some time when the sun is causing roof-top PV systems to deliver full output, within a few minutes clouds would quickly and drastically reduce their output. At that point, the peaker plants would be needed. Thus, it is unclear to what degree, if any, roof top PV systems would reduce the need for peaker plants although it would reduce the frequency with which they would need to be fired up.
I recall reading something about a company in California that was bundling rooftop solar into large blocks and then selling it to a utility.
The utility would be dealing with one customer and a large amount of power not many small power providers.
The accumulation of many sources of distributed power (over a large area) would tend to make the average power available a bit more regular and predictable.
“A BIT more regular and predictable” is right.
Solar is more predictable than wind. It is a generally known fact that before the sun rises and after it sets there is no direct solar power available. And, because clouds can be seen, the peaking plants can be started and prepared to compensate for shading. But the utilities still have to have the capability of delivering full power when wind and solar power are not available. Thus, the investment required in reliable sources of power cannot be reduced just because wind and solar power are connected to the grid.
In slightly earlier times, the fuel used to generate power was only slightly more than 10% of the cost. The rest of the cost was in employee payrolls, interest, return on the investment, and taxes. That has changed; now the fuel can account for more than 50% of the cost, but the other costs are still very significant and are not reduced by having solar and wind systems connected to the grid.
Craig,
As I see your proposition you are still arguing for a reorganization of society to suit the problems of an ideologically preferable, but inadequate technology.
This type of approach is always suggested by those who have become so impassioned by a “solution” , that they must redefine the “problem” to overcome the “solutions” deficiencies or shortcomings.
In a little publicized report to shareholders in 2014, Warren Buffett was amazingly candid, explaining. “I will do anything that is basically covered by the law to reduce Berkshire’s tax rate. We get a tax credit if we build a lot of wind farms. That’s the only reason to build them. They don’t make sense without the tax credit.” !
It doesn’t stop there, energy mandates at both the state and federal level compel utilities to generate a percentage of their electricity from wind and solar. After Warren Buffet and Wind/ Solar lobbyists made a series of large donations to the Democrats, Federal agencies began a campaign shutter many traditional power plants, leaving wind farms to take their place.
It’s the US taxpayers and consumers who pay for those huge guaranteed profits reaped by Wind and Solar investors. The production tax credit for wind is estimated to cost taxpayers $13.8 billion between 2014 and 2018.
Both Wind and solar installations have a limited lifespan. Both require massive investment in distribution infrastructure and increase the likelihood of damage and wear to the existing grid.
All this is not driven by considered evaluation of energy generation and distribution technology, or even commonsense. Instead,these inappropriate and inadequate technologies are being imposed for ideological and political reasons, and enriching a relatively small group of wealthy corporations and individuals at the expense of taxpayers and consumers.
All this is justified in the name of averting the threat of imminent climate change. Those voices who dare to suggest that making decisions in a panic may not produce a long term benefit, become are subjected to a torrent of outrage and cries of ” Burn the heretic” !
How may decades have fossil fuel companies received incentives to drill baby drill or dig buddy dig how many have vanished leaving the taxpayer the mess to clean up.
Hi Roy,
Yesteryear’s bad practices can’t be used to justify today and tomorrow’s equally disastrous policies.
Many resource incentives were granted during time of war and to encourage development of depressed or under-productive areas suffering from poverty and deprivation.
These industries created the modern world and vast wealth, they created the civilization we all enjoy today.
As we start to phase out fossil fuel energy, it must be for truly superior replacements. If the disastrous debacle of Corn based ethanol has shown, alternate energy technologies must be carefully monitored and continually assessed impartially and unemotionally.
The planet, and certainly the US, can’t afford to fritter away billions on inadequate technologies. The US simply can’t afford more white elephants that, like ethanol, grow too large to be replaced without massive political backlash from vested interests.
I recently read an article where Provo Utah approved a law to charge solar customers a fee based on the amount of solar they owned. While this was under the guise of the whole grid maintenance argument in the beginning of the article, reading further brought to light that Provo derives a substantial amount of revenue for services such as police, fire, trash and other public services buy charging a tax on the electric power used by each house and if some were using little or no power the town would not be getting the amount of revenue they needed to keep operating. So the brunt of the problem here is that the town failed to charge taxes for services rendered as other towns do with property or per capita tax and tied it to power usage. Of course what happens when people just make their houses more efficient and start using much less power as I did at my house or no power at all but do not have a grid tied PV system? Are they to be charged a fee also because they are not contributing to the revenue for town operations? THis basically punishes them for being efficient. I wonder how many other places this is also the case.
Good questions. In any case, there is no doubt that our tax strategy should reward virtuous behavior, not punish it.