The Sadness of Solar Power -- USA-only version

A lesson in why for-profit, corporate utilities coupled with weak government rules lead to darkness or little progress.

Solar panels have dropped in price by 80 percent in the past five years and can provide electricity at a cost that is at or below the current retail cost of grid power in 20 states, including many of the Northeast states. So why isn’t there more of a push for this clean, affordable, safe and inexhaustible source of electricity?

First, the investor-owned utilities that depend on the existing system for their profits have little economic interest in promoting a technology that empowers customers to generate their own power. Second, state regulatory agencies and local governments impose burdensome permitting and siting requirements that unnecessarily raise installation costs. Today, navigating the regulatory red tape constitutes 25 percent to 30 percent of the total cost of solar installation in the United States, according to data from the National Renewable Energy Laboratory, and, as such, represents a higher percentage of the overall cost than the solar equipment itself.

In Germany, where sensible federal rules have fast-tracked and streamlined the permit process, the costs are considerably lower. It can take as little as eight days to license and install a solar system on a house in Germany. In the United States, depending on your state, the average ranges from 120 to 180 days. More than one million Germans have installed solar panels on their roofs, enough to provide close to 50 percent of the nation’s power, even though Germany averages the same amount of sunlight as Alaska.[/i]


more here:
http://www.nytimes.com/2012/12/13/opinion/solar-panels-for-every-home.html" onclick="window.open(this.href);return false;

It's not all bad news from the investor-owned utilities. The biggest electricity provider in Florida (Florida Power and Light) offers a very generous rebate ($2,000/kW) and has a very easy method to apply for, and provide supporting documents for, the rebate program. I was really amazed at how easy it was when I went through the process earlier this year. About the only negative is that the program is so popular that the window for submitting an application opens and closes in about sixty seconds. You apply through FPL’s web site and you have to type real fast.

The biggest grief Florida residents seem to put up with, when it comes to solar installs, is dealing with homeowner associations. Fortunately there's a law in place that prevents HOAs from completely denying a homeowner the right to install solar panels, but they do tend to drag the approval process out for as long as they possibly can.

Overall, I'd say it’s fairly easy for Florida residents to install solar panels. Our main disincentive is that electricity is pretty cheap (about 11 cents/kWh, 24-hours a day). On the other hand, the net-metering law allows us to get full retail rates for the electricity we send back to the utility (as long as we don't have a net surplus at the end of the year).

Amen, OB.

As far as I can tell right now, if one wants to move forward faster than the speed of (pick one: []mud []government) in the US they'll have to do it themselves.

I would like to see a low power (1200w?) plug and play model for self install.
Grid tie is the issue to get around.

Germans are hot about the solar because they sell it to the grid at retail. Try that with PG&E. So it's nice to hear you offset the usage, it's what happens once you start feeding your green juice into the grid that royally sucks.

I'd love to sell my excess kWs at or near the price they charge me --which is 9 to 50 cents (summer) per kW --like the Germans get to do. I've read they average 30 cents per kW, we, about 3 cents as far as I remember last time I talked to a solar install salesman.

Once that changes I am putting up a 10 kW system on my roof.

ILETRIC said:

Germans are hot about the solar because they sell it to the grid at retail.

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Technically - in Germany PV gets a Feed-in-Tariff which is currently worth between zero (for projects 10MW+) to 19.5 euro cents/kWh for projects < 10 kW.

http://cleantechnica.com/2012/06/28/sol-invictus-german-government-cuts-solar-fit/" onclick="window.open(this.href);return false;

I assume this payment is on top of wholesale electricity rates, but I'm not sure.

ILETRIC said:

Germans are hot about the solar because they sell it to the grid at retail. Try that with PG&E. So it's nice to hear you offset the usage, it's what happens once you start feeding your green juice into the grid that royally sucks.

I'd love to sell my excess kWs at or near the price they charge me --which is 9 to 50 cents (summer) per kW --like the Germans get to do. I've read they average 30 cents per kW, we, about 3 cents as far as I remember last time I talked to a solar install salesman.

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A number of states in the U.S. have net metering laws, which allow customers to, effectively, sell their excess power back to the utilities at the retail rate. Florida is one of those. But, California doesn't seem to have quite as sweeping a rule.

An interesting article on the subject has the following quote:

"But the affected utilities, the three large investor-owned companies operating in the state [California], say solar customers have been getting a free ride on the backs of regular ratepayers. They use the grid essentially as “a big battery” without covering the cost to maintain it, said Steven E. Malnight, a vice president at Pacific Gas and Electric."

http://www.nytimes.com/2012/06/05/business/solar-payments-set-off-a-fairness-debate.html?pagewanted=all&_r=0" onclick="window.open(this.href);return false;

ILETRIC said:

Germans are hot about the solar because they sell it to the grid at retail. Try that with PG&E. So it's nice to hear you offset the usage, it's what happens once you start feeding your green juice into the grid that royally sucks. I'd love to sell my excess kWs at or near the price they charge me --which is 9 to 50 cents (summer) per kW --like the Germans get to do. I've read they average 30 cents per kW, we, about 3 cents as far as I remember last time I talked to a solar install salesman.

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I wish I knew what you are talking about. That's certainly not my experience. I sell electricity to PG&E every spring, and part of the summer, at the high summer rates. Then I buy it back in the winter, at the low winter rates. That strikes me as an unbeatable deal. I am getting more than a "free ride" as the NY Times article Weatherman quoted says.

Now, I suppose you must be talking about the case where you are a net producer over a twelve month period. i.e. you want to make money by generating electricity and selling it to other people. At that point you are effectively a manufacturing company, rather than a consumer. Since you are not handling distribution, billing, and service for the ultimate consumers, you can't possibly expect to get everything they are paying for their electricity.

I consume more than I produce, so I haven't experienced that side of the picture, but based on the PG&E NEM tariff it doesn't look like it could be nearly as bad as you say.

Net Surplus Electricity Compensation (NSC):
(b) The NSC Rate – The NSC Rate is defined as the simple rolling average of PG&E’s default load aggregation point (DLAP) price from 7 a.m. to 5 p.m., for a 12-month period. PG&E shall use the NSC Rate as the value of the electricity portion of its net surplus compensation rate. PG&E will calculate the NSC Rate each month. It will be effective on the first day of that month and PG&E will use it in the NSC Calculation for any Net Surplus Generators with a Relevant Period completed in that month (True-Up Month).

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I couldn't find a definition of LDAP on their website, but even if they are paying you just the generation component of the rate, that is going to be way more than 3 cents/kWh over that time period.

The real point, though, is that you shouldn't be trying to start a solar generation business at your home. So long as you are generating no more than you use, net over the year, I consider that PG&E provides an excellent deal for adding solar to your home.

Ray

All I know is what the solar salesman told me (3 cents) and what I read about German residential solar (30 cents) -- state sponsored.

PG&E is not exactly a wonderful company. They are in my book on par with Comcast. That's despite the picture-perfect heroics of their crews in the news after the storm (or during). I mean, it is a company that needs to be supervised by a public entity (PUC) to make sure it stays straight.

The fact that I feed juice into the grid (if I owned a solar) is NO SKIN OFF THEIR NOSE in terms of the use of their infrastructure. Juice does not eat up their copper, in other words. I make more damage to PG&E (their transformer) by plugging in my Leaf then trickle feed juice into the grid.

The problem is that, in my humble opinion, deep down PG&E doesn't like solar. It clearly nibbles on the most importnat aspect of their bread and butter business which is generating power. Imagine there was a solar on every roof in Ca.

What would PG&E do then?

I know...sell it to other states at a handsome profit... :lol:

ILETRIC said:

PG&E is not exactly a wonderful company. They are in my book on par with Comcast. That's despite the picture-perfect heroics of their crews in the news after the storm (or during). I mean, it is a company that needs to be supervised by a public entity (PUC) to make sure it stays straight.

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AFAIK every investor-owned utility is supervised by the government, and most of the others are run by the government. Hey, I'm no PG&E fanboy. Their rates appear to be among the highest in the country, though I do like their power mix. All I said was that their payback to folks with solar seems more than fair, at least until those folks get greedy.

Ray

I read that article a few days ago. I guess we are lucky here, it took just a few days to get the permitting together for our install in WA state. another friend just pulled the trigger a few days ago, the install will be complete next week. From our experience here, it's far from sadness, in fact it seems like we are witnessing a boom!

ILETRIC said:

The problem is that, in my humble opinion, deep down PG&E doesn't like solar. It clearly nibbles on the most importnat aspect of their bread and butter business which is generating power. Imagine there was a solar on every roof in Ca.

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Utilities in California (I am not certain of other states) do not generate power for profit.

Utilities are solely in the business of electricity distribution. Their profits on distribution are regulated by the PUC. Utilities generally sign long-term contracts for electricity generation contracts, the cost of which is passed directly on to the consumer with no additional markup.

Juice that you feed into the grid definitely uses their infrastructure. For large customers, in general over 20 kW of load, for every kW of load (or generation if you are net metered), the utility will charge you a demand fee based on the highest 15 minute average kW load every billing period.

This demand charge is supposed to reflect the utilities cost of installing and maintaining sufficient electrical capacity for your load (or generation).

As a residential net-metered customer - your demand fees are rolled into your distribution charges so you aren't able to see this cost directly.

But you can be sure that utilities are trying to figure out how to get this by the PUC (SDG&E has already tried unsuccessfully) so that net-metered customers with high demand but low net-usage pay their "fair share".

Drees, it sounds well funded, but the way I understand it the demand fee means 2 things:

1. when I turn on my hair dryer, or for that matter plug in the Leaf it actually creates a "situation" for PG&E;

2. It requires PG&E to start driving around my neighborhood to make sure the infrastructure is holding up to my usage and keep a constant watch on that infrastructure.

All I know is that no one, whether it's the utility company or even the state are not interested in promoting the green juice by subsidizing it (30 cent per kW level) while the oceans are getting more and more acidic and the Arctic is melting (king tides anyone)?

Net metering does not mean that the Utility has to pay you the usage rate. We have net metering, but they only pay .03kW h once every year for any surplus.

I'm in Michigan, so I would imagine the payoff period for installing solar panels exceeds the life expectancy of the panels.

ILETRIC said:

the way I understand it the demand fee means 2 things:

1. when I turn on my hair dryer, or for that matter plug in the Leaf it actually creates a "situation" for PG&E;

2. It requires PG&E to start driving around my neighborhood to make sure the infrastructure is holding up to my usage and keep a constant watch on that infrastructure.

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A single hair dryer or LEAF isn't much of a situation. But a neighborhood of "situations" does create a real situation.

ILETRIC said:

All I know is that no one, whether it's the utility company or even the state are not interested in promoting the green juice by subsidizing it (30 cent per kW level) while the oceans are getting more and more acidic and the Arctic is melting (king tides anyone)?

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The state (California) has already subsidized nearly 2 GW of PV through the CSI Program. Only a fraction of that was subsidized at $0.30/kWh though. My PV system was subsidized - without the subsidy I might not yet have a PV system.

In addition to the CSI Program, the state is mandating the utility companies to obtain at least 33% of their energy from renewable sources like solar PV. That mandate has directly resulted in a huge amount of solar and wind farms in the last couple years.

Could more be done? For sure. I think that one big area for growth will be community solar type projects which will make virtual-net-metering possible for customers who either don't own or don't own suitable space for a PV. Imagine if you could with a click of a button add 1 kW of local solar PV to offset your electricity usage.

kubel said:

I'm in Michigan, so I would imagine the payoff period for installing solar panels exceeds the life expectancy of the panels.

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That may well be a wrong assumption. A good idea would be to start here
http://www.dsireusa.org/incentives/index.cfm?State=MI" onclick="window.open(this.href);return false;
to see if anything applies to you. If not, there is always the federal tax credit. If you have a halfway decent solar resource and can DIY the system, you are almost guaranteed to come out ahead.
You might want to follow this thread as well. http://www.mynissanleaf.com/viewtopic.php?f=27&t=10521" onclick="window.open(this.href);return false;

drees said:

...Could more be done? For sure. I think that one big area for growth will be community solar type projects which will make virtual-net-metering possible for customers who either don't own or don't own suitable space for a PV. Imagine if you could with a click of a button add 1 kW of local solar PV to offset your electricity usage.

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Interesting that you mention that. My local power co-op is building just such a project in one of the sunniest parts of their territory (Paradox Valley). Panels can be purchased by customers and the power generated will offset their home usage at a rate slightly less than the normal power rate, with the difference used to maintain and replace panels as needed for the next fifty years. The area municipalities have already purchased large chunks of the project, so the panels are going fast. Payback is about fifteen years I believe, and there is no hassle with installing and maintaining a home solar array.

Since my local electric utility is a non-profit rural co-op they are sensitive to how costs are distributed among customers/owners. Lately they have been raising the service charge paid by all customers to help support the maintenance of the grid. Power is purchased from a much larger entity that supplies electricity to dozens of co-ops in four states; those are the costs that lead to the metered rate. While the co-op encourages solar (and micro-hydro) because the customer base here generally supports it, they are sensitive to the difficulty in distributing the costs of running the system fairly among the ratepayers. It is a surprisingly difficult balancing act.

45 cents per share?? wow... guess it all depends on the share price and if its a few hundred, then ok i guess