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Energy Utilities Trying To Stifle Growth of Solar Power
An anonymous reader writes: Incremental improvements have been slowly but surely pushing solar power toward mainstream viability for a few decades now. It's getting to the point where the established utilities are worried about the financial hit they're likely to take — and they're working to prevent it. "These solar households are now buying less and less electricity, but the utilities still have to manage the costs of connecting them to the grid. Indeed, a new study from Lawrence Berkeley National Laboratory argues that this trend could put utilities in dire financial straits. If rooftop solar were to grab 10 percent of the market over the next decade, utility earnings could decline as much as 41 percent." The utilities are throwing their weight behind political groups seeking to end subsidies for solar and make "net metering" policies go away. Studies suggest that if solar adoption continues growing at its current rate, incumbents will be forced to raise their prices, which will only persuade more people to switch to solar (PDF).
Electric companies don't like being forced to pay far above their normal cost for something they have to throw away by shunting it to ground. That's net metering, when done on a large scale. The light outside might LOOK ten times brighter than the lighting inside Walmart, but it's actually 10,000 times brighter. Your eyes are very good at seeing in a wide range of light - from candlelight to full sun, a million times brighter. They do so by using a logarithmic, rather than linear, scale for brightness. For the same reason, although the noon sun may APPEAR to be only twice as bright as the sun at 9:00 AM, it's actually much, much brighter. Virtually all of the solar electric is generated when the sun is bright, from about 10:00-2:00.
What that means is that if most people had solar panels, from 10:00-2:00 they could generate as much power as they use the rest of the day. Their electric bill under net metering would be zero. However, the power company still has to provide power to them the other 20 hours per day - for free. See how that could be a problem for the utility, having to provide power for everyone, but nobody has to pay for it?
The utility can't give them back the power generated ten hours earlier, because there is no effective way to store power at utility scale. I know someone who heard a stock tip about some cool new company with magic storage will want to argue with me on that, but I've looked into all of the options and nome of them work at scale. You can try to argue with me, but I'll make you look very, very foolish when I apply some arithmetic to your idea.
Net metering is survivable if only 1% of people do it, because their neighbors can use their noon power. If everyone is doing net metering, you need a magic free energy source the other 20 hours per day. If you decide that solar electric implies net metering, you only end up proving solar electric to be impractical, because net metering absolutely, positively cannot ever possibly work for more than a small fraction of the population.
On a related note, if your argument for solar power assumes that solar means solar electric, you're probably shooting yourself in the foot too. There are several varieties of solar power that work well. Solar water heaters are a no-brainer. Solar electric is probably the silliest approach that anyone seriously suggests, as shown by the trillions of dollars we've wasted on utter fail so far.
The problem the utilities have here is that solar is dropping so fast in cost that it's now cost effective on a 10 year ROI to install. You can put panels on your roof with a loan right now where the monthly loan cost will be cheaper than the cost of the electricity it offsets. That's true right now in almost every state in the union. The utilities see this and see a death spiral because their entire business is built around making money generating power from dirty central hydrocarbon based power plants.
So the power companies do the natural thing, they try to get tariffs raised on the solar panels to make them more expensive and halt the installations. But the problem is the panel prices are dropping so fast that anything they do is just going to be temporary. The problem with chasing the "raise the cost of solar" method of competing is that at some point those increased costs make homeowner owned storage viable. Because of the screwing around with Tariffs that happened in Hawaii they now have a booming power storage market and people are beginning to disconnect from the grid entirely.
The power companies are scared that they'll sell less power to customers with solar panels and make less money (which will hit their dividends badly) but what they should really be worried about is customers disconnecting from the grid entirely. Every customer that disconnects from the grid raises the fixed cost transfer to everyone else, which raises power prices and makes solar more attractive. You end up with a self feeding harmonics that starts a slide into a situation that doesn't just destroy the power companies dividend but destroys the company all together.
The companies need to be evolving to be that backup power supply. They need to be shifting generation strategy and bringing online storage so they can displace the gaps so customers don't do it themselves. That's their future business, moving power around and storing it for use when the sun isn't shining. It's going to mean smaller companies and less revenue but that's better than no company at all. Forward looking states realize that the games the companies are playing with the solar tariffs right now are just that games, these states are mandating the companies invest in renewables and storage so they are ready for the change. The states without foresight are allowing the companies to put a big tariff on solar customers thereby driving them towards disconnecting from the grid entirely.
I think centrally managed storage and distribution is better than everyone running their own storage array. These companies are public utilities, that is government granted monopolies that the taxpayer has control over. We should be encouraging solar installation and investing in the grid changes necessary to support it because no matter what the solar is coming. The costs are dropping rapidly and have reached the mass acceptance pricing. Solar is already cheaper without any subsidies than nuclear power. In a few years it's going to be cheaper than coal with the subsidies and within the decade it'll be cheaper than coal without. If we don't make the changes to the grid right now we won't be ready for that colossal shift in generation and everyone will be installing their own backup systems and disconnecting from the grid (which is going to hurt the poor and those living in apartments very hard). I'd be willing to bet that by 2050 half of the homes in the US will have solar arrays on the roof and solar will comprise nearly 50% of the generation capacity.
I wouldn't be investing long term in residential power companies with heavy carbon assets right now.
That's [the electric power distribution companies'] future business, moving power around and storing it for use when the sun isn't shining.
"Are you generating more solar power than you can use? We'll give you somewhere to stick it when the sun don't shine." That'll go over nicely. :p
It'll be interesting once we hit that balancing point of there being enough EV cars on the road today that gov't wakes up and restructures road funding so that every pays their fair share
If we do end up with a system involving paying a fair share, it would need to involve the weight of the vehicle, in which case the share of the cost by cars, electric or not, would be quite small considering the nonlinear effects on a road by heavier vehicles. Alternatively, one could just realize that many government fees are not about proportionately recovering costs, but influencing certain behaviors that have a variety of costs and benefits elsewhere.
Take away the government subsidies on solar purchase & installation and this problem doesn't even exist.
Take away the USA's $70 billion + fossil fuel subsidies at the same time. And drop a few of the wars they're fighting to ensure supply while you're at it.
Let me know if they'll save enough to put some cheap rooftop solar in.
And [one in a hundred thousand, owns own house free and clear, grossing $70+k/yr] solar home owner says, but it works for me
A million homes in Australia have solar panels on their roofs as of right now. That's about one home in ten. Workers, pensioners, the unemployed, everyone - rich or poor, all benefiting from free energy. The installation pays for itself in five years, and comes with a twenty five year warranty. You Americans need to crawl out from under the dead hand of capitalism and join the free world.
you said "These companies are public utilities, that is government granted monopolies that the taxpayer has control over."
Here is the problem in my (USA) area- ... they get it! The public is ignored. We once had a strong consumer advocate to counter the powerful utility lobby, but they have been emasculated. The utility is owned by a for-profit company with great resources. They can manipulate the media as well as elected and unelected officials. The taxpayer has no control over them.
The government and the profit-seeking utility are in collusion. The utility wants a rate increase
Roads are built by government (taxpayers); utilities should be run by government (taxpayers) including water, power, communications and internet. These alliances with profit making companies who have the means to manipulate government cost everyone dearly.
...omphaloskepsis often...