AZ regulators adopt $5 a month Solar Fee

[Jags]

I have said it before....IF (and it appears that we are) going to give breaks of any nature to an energy source - I would prefer it to be in the form of renewables. It only makes sense for the long run. Why we aren't doing a JFK shoot to the moon movement is beyond me.

 

[Seasoned Oak]

If im not mistaken i read that solar panels actually save a utility a load of dough by producing power at the peak demand time of day thereby saving them from have to buy very expensive peak demand power costing many times the standard KW rate. Enough solar in the mix and the utility saves even more by not needing all that stand by generating capacity which is only used at the precise time the solar is at its greatest generating potential. The trade off should at least negate any "fees" the utility might be tempted to charge.

 

[Grisu]

If im not mistaken i read that solar panels actually save a utility a load of dough by producing power at the peak demand time of day thereby saving them from have to buy very expensive peak demand power costing many times the standard KW rate. Enough solar in the mix and the utility saves even more by not needing all that stand by generating capacity which is only used at the precise time the solar is at its greatest generating potential. The trade off should at least negate any "fees" the utility might be tempted to charge.

Exactly. Our utility is paying 6 ct per kWh in addition to net metering for solar power in order to avoid paying peak rates in the utility market. (broken link removed to http://www.dsireusa.org/incentives/incentive.cfm?Incentive_Code=VT34F)

 

[Grisu]

But it's not a bad idea if it's a cost to the utility which it is. Solar should stand on its own and if it can't make a value proposition, then why should it be adopted?

Because it preserves valuable non-renewable resources for future generations i. e. our society spends something we can generate unlimited amounts of (money) to save something that is restricted (fossil fuel energy). We are currently drawing down the savings account of mother earth but there is no overdraft or credit. When it is gone it is gone.

 

[Grisu]

The idea that a regulated monopoly is okay is false. Again it reduces innovation, drives up prices, and discourages re-investment and this can be observed in almost any market. Look at the condition of the infrastructure around this country for a prime example.

Funny how a government funded new-deal program was able to enhance the infrastructure of this country by bringing electricity to many rural areas. I will also go out on a limb here and suggest that this enhanced innovation and increased productivity in rural areas. And if we would stop worrying about things like the federal deficit and concentrate on the stuff that really matters we could easily fix the infrastructure and leave our kids with some real "savings".

 

[TMonter]

Funny how a government funded new-deal program was able to enhance the infrastructure of this country by bringing electricity to many rural areas. I will also go out on a limb here and suggest that this enhanced innovation and increased productivity in rural areas. And if we would stop worrying about things like the federal deficit and concentrate on the stuff that really matters we could easily fix the infrastructure and leave our kids with some real "savings".

But you're missing a big point. DG may have been much further along had the government not pushed centralized power in the beginning and creating government controlled monopolies. A lot of resources were used to bring powers to rural areas in a very inefficient means.

 

[Grisu]

But you're missing a big point. DG may have been much further along had the government not pushed centralized power in the beginning and creating government controlled monopolies. A lot of resources were used to bring powers to rural areas in a very inefficient means.

Government pushed centralized power? Sometimes I really would like to know where you get your info from. In the early 20th century utilities started buying up each other thereby creating monopolies without any government involvement. It was FDR who finally put a stop to that and enabled the electrification of rural areas.
http://www.pbs.org/wgbh/pages/frontline/shows/blackout/regulation/timeline.html

 

[TMonter]

Government pushed centralized power? Sometimes I really would like to know where you get your info from. In the early 20th century utilities started buying up each other thereby creating monopolies without any government involvement. It was FDR who finally put a stop to that and enabled the electrification of rural areas.
http://www.pbs.org/wgbh/pages/frontline/shows/blackout/regulation/timeline.html

That doesn't disprove what I said Grisu. Government did in fact push for centralized power and a monopoly on generation.

 

[Grisu]

That doesn't disprove what I said Grisu. Government did in fact push for centralized power and a monopoly on generation.

Too bad you did not proof anything in the first place (as usual).

 

[GaryGary]

If im not mistaken i read that solar panels actually save a utility a load of dough by producing power at the peak demand time of day thereby saving them from have to buy very expensive peak demand power costing many times the standard KW rate. Enough solar in the mix and the utility saves even more by not needing all that stand by generating capacity which is only used at the precise time the solar is at its greatest generating potential. The trade off should at least negate any "fees" the utility might be tempted to charge.

I think this is open to some debate. In CA, I think you can make the argument that they pay a premium for power in the late afternoon, and that solar PV may be a good deal for the utility even though they are paying full retail for it. But, from what I've read a lot of utilities can buy power wholesale at about about a nickel a KWH any time of day, and paying full retail to customers with PV arrays is genuinely a bad deal for them. It seems like its also a bad deal in that the utility has to take the power from the customer PV arrays whether they need it or not and don't have much control over how much they get or when they get it -- not exactly the ideal supplier to deal with.

I'm all for net metering and the utility paying full retail to customers with PV as an incentive to get the industry going, and its not really much of a problem for the utility when PV is only supplying a couple percent of the power, but clearly it will become a big problem as the percentage increases. When the percentage of PV owners gets up there, then paying PV owners full retail for the power they generate is effectively a subsidy to them from their neighbors who don't have PV.

Gary

 

[jebatty]

When the percentage of PV owners gets up there, then paying PV owners full retail for the power they generate is effectively a subsidy to them from their neighbors who don't have PV.

Not exactly correct, and in fact the opposite may be true. Measuring the cost or value of solar just by the $$$ paid by the utility for wholesale power is only a small part of the value of solar.

If you add all this up, (an economically optimal price on carbon, savings from transmission losses, and a wholesale price consistent with the 5-year peak average), you get a value of solar energy
between 9.5 and 13 cents per kWh.
...
Keep in mind there are other values of solar energy I haven’t considered in my calculus. [... must also include] the savings from delaying capital investments in distribution infrastructure, savings from not having to build more generation, fuel price hedge value savings (not having to bet on fuel costs), and the value of local employment generated by manufacture and installation of solar energy.

http://netdensity.net/2013/04/24/3051/

 

[Where2]

Where2 is outraged about 10% profits. 10%! What is 10% of your electric bill? Maybe $5?

Since you asked: 10% would have been $3.45 last month. However, an additional $5 fee would exceed the ~$4 in profit the PoCo would have made if I had no PV system providing 400kWh of distributed generation last month. However, 400kWh isn't what I sent back to the grid... I'm already time shifting my third largest energy consumer in the house (the electric water heater). It runs during the typical window of my peak production. If we really boil it down to what I consider might be fair, lets talk about the 275kWh I sent back to the grid last month (through my net meter). 10% of 275kWh at my typical electric rates isn't $5, it's $2.80.

 

[TMonter]

Too bad you did not proof anything in the first place (as usual).

What you posted supports what I said.

 

[TMonter]

Not exactly correct, and in fact the opposite may be true. Measuring the cost or value of solar just by the $$$ paid by the utility for wholesale power is only a small part of the value of solar.

http://netdensity.net/2013/04/24/3051/

If there were that much advantage to distributed solar it would be more widespread. However the advantages are minimal and it has a lot of pitfalls.

 

[Grisu]

What you posted supports what I said.

What I posted supports the fact that power generation was centralized and monopolized before government involvement. This paragraph explains it nicely that not government created centralized power (as you claim) but tried to regulate it once it was established:

"By 1907, Insull had acquired 20 other utility companies and renamed his firm Commonwealth Edison.[1] He and others argued that electric utilities were a "natural monopoly" because it would be inefficient to build multiple transmission and distribution systems due to the great expense of capital investment. Therefore it was inherent that only one company would dominate the market. The emerging utility monopolies were vertically integrated, meaning they controlled the generation of electric power, its transmission in real time across high-voltage wires, and its low-voltage distribution to homes and businesses. Reformers of the Progressive Era tried to govern these emerging utility monopolies through state regulation. By 1914, 43 states had established regulatory polices governing electric utilities.[2]"

In addition, rural electrification would not have happened as fast and as thorough as it did during the New Deal during FDR's administration if it would even happened at all. You seem to think business owners are mere idiots that would try to connect a few hundred customers in rural area with miles of transmission lines when they can have several thousands customers with less effort in an urban area. Which business owner in his right mind would be willing to chase such a low profit business with such high risks unless someone made him to?

 

[DBoon]

Not true at all. The grid can only take so much intermittent power before it starts causing major issues. 15% is about the maximum. As you approach this limit the problems caused by DG becomes greater and requires much more management.

The grid can take the amount of intermittent power it is designed to take. As it is designed today, it may be around 15-20%. It could be a lot more if different grid management strategies were adopted, different power buying models integrated into the utility purchasing system, and different billing incentives were incorporated. In general, utilities want none of this - just status quo. That may be good for them, but it is bad for everyone else.

This has nothing to do with killing green power but making green power producers pay the same costs any other independent power producer would be required to pay. Realistically solar power customers should be compensated at the utility's avoided cost rate, not at the retail rate.

The problem with this is that a utility calculating avoided cost rate is about as transparent as a Hollywood movie studio calculating how much profit they made on their last movie so they know what profit sharing percentage to pay out. Utilities always seem to end up with 2 cents per kWh - regardless of time of day, and Hollywood movie studios always seem to lose money on every movie they make.

After all if you are not producing power and the utility decided only to give you a fraction of the power you needed to run your home you'd scream bloody murder.

This just make no sense at all...I have no idea what your point is here.

If you are net metering you're getting paid retail pricing. The premiums on hot summer days would be premiums on wholesale pricing, so I think you're coming out ahead.

If they metered my home to 1) tell me what the hourly price they were paying for electricity was, 2) what the price was they were selling that electricity to me was, 3) let me control my usage to buy or sell electricity based on the data I am getting, then I am sure that within 1 year some Silicon Valley company would offer me a system for $1000 that would assess this info and turn on/off discretionary use items in my home in a way that would allow me to profit from this situation. But the utility doesn't offer this capability. My guess is that likely because there is no money in it for them - I am sure I could come out ahead with this model. Here is how high tech most utilties are - my utility was still sending a guy out every other month to read a meter with analog dials on it. They can't do this remotely? And if they could, why not make that info available in real-time to me? And then supply a complete demand management kit to go with it? It boggles the mind.

The power company has to keep a full reserve for every single house regardless of the 5-6kW of power you may or may not produce. Are you willing to limit your usage to the difference should your solar system be offline or the sun isn't shining? I doubt it. As for not having to run transmission lines to move the power, yes they do, and they have to maintain those lines.

Very few power companies generate anything anymore. They are arranging for capacity, but others supply it. There may be base-load contracts, which incidentally, can result in more nighttime availability of electricity that utilities can get rid of. The result is near-zero or negative rates to get rid of the power - a completely ridiculous situation. Other contracts are for peaking demand, at higher cost, with quick-firing natural gas turbine generation. Peaking operation is expensive in the summer and also can be in the winter if natural gas supplies run short.

 

[TMonter]

What I posted supports the fact that power generation was centralized and monopolized before government involvement. This paragraph explains it nicely that not government created centralized power (as you claim) but tried to regulate it once it was established:

"By 1907, Insull had acquired 20 other utility companies and renamed his firm Commonwealth Edison.[1] He and others argued that electric utilities were a "natural monopoly" because it would be inefficient to build multiple transmission and distribution systems due to the great expense of capital investment. Therefore it was inherent that only one company would dominate the market. The emerging utility monopolies were vertically integrated, meaning they controlled the generation of electric power, its transmission in real time across high-voltage wires, and its low-voltage distribution to homes and businesses. Reformers of the Progressive Era tried to govern these emerging utility monopolies through state regulation. By 1914, 43 states had established regulatory polices governing electric utilities.[2]"

In addition, rural electrification would not have happened as fast and as thorough as it did during the New Deal during FDR's administration if it would even happened at all. You seem to think business owners are mere idiots that would try to connect a few hundred customers in rural area with miles of transmission lines when they can have several thousands customers with less effort in an urban area. Which business owner in his right mind would be willing to chase such a low profit business with such high risks unless someone made him to?

Which illustrates my point. That creates a market for someone to come up with a innovative DG solution for areas where grid power was not available.

What you fail to mention Grisu, that was before centralization by government, there were many more companies around that were distributing power. The claim that it was inherent that only one company would dominate a market doesn't hold a lot of water when you look at the number of utilities before and after regulation.

 

[Grisu]

Which illustrates my point. That creates a market for someone to come up with a innovative DG solution for areas where grid power was not available.

Solutions like homeowner PV? Or wind power?

What you fail to mention Grisu, that was before centralization by government, there were many more companies around that were distributing power.

And what you fail to mention is that this was a necessity with DC power distribution.

The claim that it was inherent that only one company would dominate a market doesn't hold a lot of water when you look at the number of utilities before and after regulation.

Numbers? Or are those again "facts" taken out of the "Austrian thin air"?

 

[jebatty]

My power company supplies off-peak at a rate which is 60% less than the general service rate. Off-peak is controlled by a device installed at the house which reads a signal sent by the power company over the grid. Off-peak is generally 11:00pm - 7:00am, and also whenever the power company wants to turn it on, which happens fairly frequently based on the loud bang from a switch/relay on our power panel.

In my simple mind approach, it seems to me that because our power company sells off-peak at a rate which is 60% less than the general service rate, the power company has bought a lot of expensive (base load ?) power to meet day time demand and needs to dump that expensive power at night at a reduced rate in an attempt to get some return on power that otherwise is paid for and would have been wasted. To me this looks like a business decision built on a business model of remote, large generating plants, very expensive, inefficient and large transmission losses, rather than on a flexible model of DG using foreseeable alternative energy, and on a model of giving incentives to encourage customer efficiency and reduced daytime demand so that it could sell off-peak power at a higher rate, or maybe even eliminate off-peak rate power, and thereby increase overall profits by evening out demand.

It also could be a business model built on the bright bulbs at the power company entering into a long term contract for remote generation using "cheap" and dirty Wyoming and Dakota coal, thinking that coal was the energy of the future. Kind of like buying stock in the horseshoe company around the turn into the 20th century thinking that horseshoes were a secure bet. Also makes a person think that the bright bulbs were about 99 watts short of 100.

What? A power company that encourages a customer not to use them so it will be more efficient and economical? Might it be that traditional Big Power is a fossilized dinosaur that thrives on consuming fossilized fuel? Perhaps it is time to dim the lights on a fossilized business and move electrical power generation into the 21st century.

 

[woodgeek]

Why can't we say that their baseload (coal) is 'cheap' and they are selling you that at their cost+markup overnight. And then they charge you 160% of that rate during the day, to cover more expensive peak generation.

Are you getting the daytime retail rate for you solar backfed PV? You could put your DHW on a nighttime timer and sell expensive kWh to them during the day, and take back cheap kWh at night for the tank. Of course, you would have net CO2 emissions with this plan. Conversely, if you wanted to minimize your backfeed (and CO2) you would put your DHW on a daytime timer to run during peak sun hours.

 

[jebatty]

Why can't we say that their baseload (coal) is 'cheap' and they are selling you that at their cost+markup overnight. And then they charge you 160% of that rate during the day, to cover more expensive peak generation.

It's could be somewhere between because the off-peak meter/electric supply is kicked in from time to time during non-peak hours, and I doubt that the power company would want to sell us expensive peak power at the off-peak rate, unless the peak power available was in excess of demand.

We get daytime retail rate for backfed PV. The electric heat and dhw are on a separate meter that gets charged the lower rate regardless of the time of day, provided that the off-peak power is available.

 

[TMonter]

Solutions like homeowner PV? Or wind power?



And what you fail to mention is that this was a necessity with DC power distribution.



Numbers? Or are those again "facts" taken out of the "Austrian thin air"?

http://www.cato.org/pubs/pas/pa-301.html

(broken link removed)

The idea that there was ever a "natural monopoly" doesn't seem to fit with the fact Grisu. Consolidation was done to some extent to take advantage of economy of scale, but prior to government regulation there was very healthy competition in the electric power market.

 

[Laszlo]

I'm just gonna leave this here:

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Surprisingly catchy criticism of the APS decision, set to the tune of Total Eclipse of the Heart. Even more surprisingly, it's the work of Barry Goldwater Jr. and his group TUSK, some dissenting conservatives who are opposed to the new solar "tax" and argue energy choice and competition is the real conservative way.