The California Public Utilities Commission (CPUC) decided to delay the much-maligned Net Energy Metering (NEM) 3.0 proposal indefinitely.
As proposed, it would have slashed the payments made by utility companies to rooftop solar owners for exporting their excess PV production back to the grid. EQ Analysts said the proposal would lead to a 57-71% overall reduction in solar savings across the state.
A provision that was particularly under fire was the grid access charge, an $8/kW solar capacity charge per month, which experts called a “tax on the sun.” The charge would apply to all solar customers, regardless of whether they have grid-supporting technology like battery energy storage. A typical 7kW system owner would pay an additional $56 a month under the proposal.
Pointing to the absurdity of the fixed monthly charge in a ROTH Capital webinar, seasoned grid expert Dr. Ahmad Faruqui said, “Why should someone buying carrots at the grocery store have to pay more because they also grow carrots at home?”
Image: CALSSA
SolarReviews, a residential solar informational site, interviewed about 4,000 active solar shoppers in the state, and showed them what their solar savings potential looked like under the assumptions of NEM 3.0. The results were nothing short of damning for California rooftop solar, as 95% responded they would no longer purchase under the cost assumptions. In many cases payback periods were increased to as much as 20 years, a wait many viewed as unreasonable and too risky.
Working Californians, environmentalists, and clean energy advocates quickly learned of the proposal, and with the help of organization by the California Solar and Storage Association (CALSSA), thousands took to the streets to protest. Over a thousand workers in front of the CPUC and nearly 2000 in Los Angeles demonstrated, calling upon the Commission and Governor Newsom to throw out the proposal and save the state’s distributed solar future.
Now, it appears that the voices of all who opposed the measure have been heard, as the decision is postponed indefinitely.
The CPUC was scheduled to meet and vote on January 27th. Then, it was reported that Governor Newsom said there was still “work to be done” on the proposal, and it was discovered that the proposed decision was not on the docket for the 27th, nor the February 10th meeting. Now, it appears that the voices of all who opposed the measure have been heard, as the decision is postponed indefinitely. Reuters reported CPUC president Alice Reynolds requested more times to consider changes.
“We are glad to hear that the commission is working to get this proposal right,” said Environment California’s state director Laura Deehan. “I’ve walked alongside thousands of concerned citizens who want our state to catch more solar energy from our rooftops. Governor Newsom heard us, and made clear that changes had to be made to the proposal. Now, the commission needs to make sure that California continues its solar leadership.”
PG&E to recoup wildfire costs from ratepayers
In what may be a related move, a new Californian state agency established by the Newsom administration called the Office of Energy Infrastructure Safety announced it granted PG&E a special provision to recoup wildfire costs from electric ratepayers by raising rates.
Image: NSF/Wikimedia Commons/Rennett Stowe
These are some of the same wildfires PG&E were found liable for. In 2017 alone, downed transmission wires from aging infrastructure set fire to a drying state, causes massive wildfires, leaving many Californians without homes, and sticking PG&E with a $7.5 billion bill. The liabilities eventually caused the utility to declare bankruptcy. Now, it appears the ratepayers will be footing the bill.
The steep provisions in NEM 3.0 led many experts to wonder if the proposal was an effort to bail out California utilities who had been so crushed by the cost of wildfires. Now, the Office of Energy Infrastructure Safety will instead grant power to PG&E to, “seek the recovery of the utility to seek recovery of catastrophic wildfire costs from its ratepayers, or from the California Wildfire Fund. . . . It is Energy Safety’s assessment that PG&E has additional work to complete, but is taking steps to improve its operations and culture. This has been documented through the safety certification process.”
The Energy Safety Office’s decision acknowledges PG&E hasn’t eliminated the potential for future wildfire problems. It says, “Issuance of the safety certification does not constitute an affirmation by Energy Safety that PG&E has taken all possible steps to prevent its equipment from causing wildfires. Nor does it shield PG&E from liability or litigation.”
The Environmental Working Group of California said the best solution to prevent future wildfires caused by PG&E and other large utilities is to reform the current model of centralized electricity distribution that centralized power model that sends energy hundreds of miles through often unmaintained and dilapidated power lines over dry, drought-ridden central and Northern California landscape covered in brush and trees that fuel these fires.
In his new book Freeing Energy, venture capitalist Bill Nussey outlines this debate of the traditional structure of centralized power versus the new, distributed, flexible grid many are envisioning.
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NEM-2.0 is still the rule. The Fed still gives homeowners Tax credits. Solar panels installations will never be less expensive than right now with inflation and labor costs going up and now, it appears the ratepayers will be footing the bill for the PG&E bankruptcy and are asking for an across the board 30% increase in electric rates. 2022 is the year to put solar in your roof or buy a new solar glass roof.
California lets lead in the fight against climate change and high utility rates that you should not have to pay for bailing out corporate criminals.
“Now, it appears that the voices of all who opposed the measure have been heard, as the decision is postponed indefinitely.”
What of the overwhelming majority who are being ignored? The 3.5 billion dollar cost shift is going to be 4 billion by the end of the year. This whole rich declaring themselves poor thing has really gotten old. I don’t think the rooftop solar folks realize just how big a hole you’re digging for yourselves. This subject is a lot more likely to go national now and organizations like the AARP and possibly NAACP are going to get involved. The tone-deaf arguments from people like Ruffalo, Norton and Schwarzenegger will wither under the harsh light of economic reality. The current support you’re seeing is likely to evaporate once Grandma Millie gets to talking about her fixed income. Once the NAACP starts pointing out the ethnic disparities with rooftop solar you’re in for a messy fight. All they need to do is send out a few mailers and the Dear Senator letters will start to fly.
How you guys have managed to take a “tax the rich” situation and turn it into a “taxing the sun” situation is beyond me. Carrots? What kind of silly argument is this? The grid is the most complicated and expensive machine on the planet. The costs of maintaining it should be shared by all of us. Currently, the cost-sharing is getting more and more regressive thanks in part to roof-top solar. The typical solar home in California consumes over twice as much electricity as the average home. These rich households should be paying $300 for electricity but they’re only paying $50. Meanwhile, poor Grandma Millie is snipping coupons. The CPUC may have delayed the decision but I can’t imagine they’ll be able to sit on this for long.
“Poor Grandma Millie is snipping coupons.” Poor grandma Millie is getting her electrical power, natural gas and water for HALF PRICE if she signed up for “CARE” with any of her California utilities. The utilities do not pay full value for electricity produced from rooftop solar because of the tiered and time of day rates they impose on Solar customers, plus the original connection fees they charge to hook up. The solar panel system costs more than a new car and generates needed electricity to get homeowners out of the expensive tiers the utilities charge. Cities are imposing 5% utility taxes but except those on the CARE program or for citizens over age 70. I wish the utility would cost share my solar panel system and batteries. Cost shifting is a lie dreamt up by utilities about rooftop solar customers. Only 10% of homes have solar in California and it was limited to the previous year’s electrical bill plus 15%. Rooftop solar only accounts for 3% of all the electricity used in California Industry and commercial usage is 70%. 16% of California residential Rate payers are on the “CARE” system that is the real “cost shifting” program along with tiered rates that larger homes pay more on.
AARP has filed an official brief against California’s NEM policy. The California Alliance for Retired Americans has also come out against the policy.
This link lists a ton of groups that have come out against the policy. You’ll notice the opposition is
coming from a diverse set of parties and not just IOUs. The IBEW is among them.
https://fixthecostshift.com/september-letter-to-cpuc/
“The grid is the most complicated and expensive machine on the planet. The costs of maintaining it should be shared by all of us. Currently, the cost-sharing is getting more and more regressive thanks in part to roof-top solar. ”
I don’t question that the grid is complicated and expensive to maintain. The cost to provide service across the state is already shared by all of us, but it’s not being shared proportionately. Customers in urban cities are subsidizing the bill for those in secluded rural areas, especially mountain regions. The cost to provide electricity to a suburban home in urban area with no risk of fire is substantially lower than providing service to a single rural home in the middle of nowhere in the mountains. If you want everyone to pay their fair share, mountain folks will not be able to afford to live in the mountains anymore.
On top of the minimum charge I already pay PG&E to cover the cost of providing me service, they get to use my net generation to provide energy to net users and to also power the pumps that fill reservoirs by day with millions of gallons of Potential energy ready to get all Kinetic at night. PG&E requesting that I pay 500% more in fees is not the answer. The combination of the State forcing PG&E to provide electric service to everyone and PG&E neglecting to maintain their property while swimming in profits for decades has create a really F’d up situation and I won’t stand to be the one to pay for it. Nuclear will rise from the ashes sooner than you think.
I’ve lived in the mountains and I think that’s a bit of an over-reach. You may be right about some small percentage of mountain dwellers not being able to afford to pay their full share but I think we’re talking about a few thousand at most. The cost shift of keeping this tiny sliver of people in their mountain homes is de minimis. It’s several orders of magnitude lower than the 3.5 billion dollar cost shift NEM is causing. As an aside, I think escalating insurance costs are far more likely to convert mountain dwellers into flatlanders.
To your larger point, should we subsidize the repopulation of places like Paradise by undergrounding 40 billion in transmission when the vast majority of fires are started by lightning, cigarettes and tail pipes? HECK NO… It’s pure madness. This makes about as much sense as subsidizing sandbags so people can live in floodplains.
PG&E or any of the other IOUs for that matter wouldn’t be raising your bill 500%. They’d simply make it so 75% of your bill was a grid access charge and about 25% was energy charges. This is far more reflective of what the true costs of providing electricity are. Some folks would see a bump up, some down but the total revenue would be the same. Rooftop solar will continue to be a viable industry at a deployment rate of perhaps 500 MW per year. This certainly isn’t the dystopian future folks like Faruqui are complaining about.
I’ve read through this entire comment section and I have to respectfully disagree with many of your points. Many of which have already been commented on by other people so I won’t add to those, but I do want to comment on a few specific things.
The first is your comment on the price coming back down to $0.05/kW. There is no way that is ever going to happen. On top of that, I’d be willing to bet the farm that if NEM 3.0 passes, the price doesn’t come down even one penny from where it’s at right now! NEM 3.0 is just a way for the utilities to protect their profits because the customer usage is shrinking.
The second issue is one that no one has commented on so I’ll take a stab at it. There is 100% no doubt in my mind that once NEM 3.0 passes, solar is going to take a dramatic, but temporary, nose dive. I am a prime example, as are two of my co-workers. I’m looking to get solar right now, but I 100% will not get it if I’m forced onto NEM 3.0. NEM 3.0 makes it way too expensive and the payback period is way too long. The closer the payback period comes to the warranty period of the equipment, the more and more it is less attractive. There are many studies out there that claim NEM 3.0 will push the payback period out to 15-20 years. It’s simply not worth it! The point of solar is to get ahead, not just break even. So in the short term, NEM 3.0 will absolutely kill solar. However, the battery technology, pushed also by EV’s, is advancing very fast. Solid state batteries have over three times the capacity, are smaller, lighter, are cheaper to produce, and can sustain higher recycle rates. Some reports have solid state batteries hitting the EV and solar markets in as little as 2 years. Once the battery capacity increases and the price decreases, solar sales will start to take off again. Only this time, people won’t care about NEM 3.0 because they’ll be going 100% off grid.
So the whole argument that electrical prices are going up because solar people aren’t paying their fair share of the grid absolutely falls apart. If the utilities are complaining now, even though under NEM 2.0 they’re getting $12/month for the connection fee and they’re collecting $0.02/kW in hourly NBC’s, what are they going to do when solar people start disconnecting from the grid left and right? The utilities won’t be collecting a single penny from the off-grid people. If you think the prices for non-solar people are bad now under NEM 2.0, then by the very same logic, the electrical prices are going to skyrocket once people start going completely off-grid, thus further hurting the poor.
So the question becomes, would the utilities rather have me paying NEM 2.0 prices towards the infrastructure or would they rather me go off grid and not pay a dime into their system? This is the reality of things and what NEM 3.0 is going to do! It’s basic economics. At some point in the not too distant future it will be cheaper to buy batteries and go off-grid than it will be to stay connected to the grid and pay the super insane NEM 3.0 utility fees.
I mean, under one version of NEM 3.0 the utilities wanted to charge a connection fee of $10/month per kW system size. So if you had a 10kW system, then you’d be paying a connection fee of $100/month. Just to connect to the grid! That’s absolutely insane! For reference, $100/month * 12 months * 20 years is $24,000. Even using current battery technology, that’s enough to pay for two, possibly three Tesla power walls. And that’s without the 26% rebate. Plus, on top of the insane connection fees, NEM 3.0 is also seeking to increase the cost of the NBC’s (Non-bypassable Charges) as well. You add that into the equation and going off-grid looks more and more attractive.
Also, isn’t California is supposed to be the leader in “Green” technology? If NEM 3.0 passes and people start going off-grid, California will lose out on all the free excess energy people are over-producing; which means more coal, nuclear, etc to fill the needs during the day. That is a HUGE step backwards, not forwards! At least under NEM 2.0, anything I’d be over-producing would go back to the grid for others to use and thus saving resources, pollution, and the planet.
Like I said, all these poor people the utilities are trying to protect are exactly who is going to suffer if NEM 3.0 passes and people start going off-grid. If the utilities are really trying to protect the poor, the utilities should be trying to keep the solar people connected to the grid as cheaply as possibly to prevent them from going off-grid!
I don’t see how we can make the electrification of heating and transportation affordable without reducing the unit price of electricity. In markets with high solar penetrations, we’ve seen a steady movement away from traditional rate structures towards time-of-use. I don’t know if you’ve looked at wholesale electricity prices lately but there’s a lot of electricity that’s being sold for 5 cents/kWh and under. Utilities have a very clear incentive to communicate these low prices to their customers. Differentiated electricity pricing has been used since the early days of electrification to encourage more electricity consumption at night. In grids with lots of wind and solar, we need to show customers that electricity is cheap when it’s windy or sunny. Price signals have a solid trackrecord and I believe this time-tested solution will be a key ingredient in the electrification process. If you know of an alternate way to encourage the electrification of heating I’d love to hear it.
“There are many studies out there that claim NEM 3.0 will push the payback period out to 15-20 years. It’s simply not worth it! ”
A 15 to 20 year payback translates to 3.5 to 5% returns. People happily accept these sorts of returns from their mutual funds. Germany has a healthy rooftop solar market despite the fact that solar has a 20 year payback period in that ever so cloudy country. As you say, the rooftop solar market will take a hit when we finally abolish NEM. I’m confident it will recover just like we’ve seen in Germany, Italy, Spain and other places where they rolled back over-generous subsidies.
If you read the whole thread you’ll know that the utilities aren’t the only ones pushing to get rid of NEM. This is becoming an issue for retirees, ratepayer advocacy groups, minority advocacy groups and utility solar and wind interests. The rooftop solar supporters want to keep the focus on just the utilities but there’s a much larger advocacy effort. 3.5 billion dollars is a lot of money to be shifting from low and medium-income homes over to higher-income homes. The optics on this are really bad.
Solar has gotten 80% cheaper than it was 20 years ago. If there was going to be an exodus off the grid I think we’d have seen some clear signs by now. It’s not that hard to over-size your PV systems, add batteries and install a backup generator. I could see a few thousand rural homes trying this but I don’t see it becoming a significant number. Nothing like the 1,000,000 homes that aren’t paying anywhere near their fair share for accessing the grid. I view this argument as an empty threat. A far less funny version of, “If you don’t buy this magazine, we’ll kill this dog.”
We can build a 100% clean grid without any rooftop solar at all. The key ingredients are utility wind and solar, the grid, dynamic electricity pricing and a renewably sourced backup fuel. This is the shared objective we should be focusing on. I think coddling to wealthy households is holding us back. The longer we entertain these selfish arguments the bigger the cost shift gets. The situation is akin to stretching a rubber band that you have on your wrist. The longer this goes on the more painful the snap back to reality process is going to be.
Sure, if you want to look at just the price for the generation of electricity all by itself, then sure, it may get down to $0.05/kW. But that means nothing if you can’t deliver the power to the customer. Thus, the grid and PG&E’s super high transmission and distribution fees that are tacked on top of that.
I can’t comment on how other countries work, but I live in California and the local communities have already switched over to using green energy generation (Solar, Wind, and Hydro). My bill is broken up into two main parts. One is the generation of energy (which is outside of PG&E). For that I’m paying a flat rate of $0.08/kW for the generation of power no matter how much energy I use. However, the other section of my bill is the transmission and distribution of that energy via PG&E. This is also a tiered system, where it’s $0.16/kW if you’re under your baseline and if you hit the 3rd tier, it’s just over $0.36/kW. So when you combine these two together, I’m paying a $0.24/kW if I stay under their baseline allotment and $0.44/kW when I hit the 3rd tier.
So I stand by my statement, while it could be argued that we may get the generation of power down $0.05/kW, that’s also the smallest part of the equation and your bill. The transmission and distribution fees are many magnitudes higher than the generation costs. I don’t see those prices budging at all because those represent the physical grid infrastructure itself which is unrelated to how power is generated. Wire, transformers, etc, are not decreasing in price. Labor to work on the lines is also not decreasing. So I stand by my point that the over-all price of electricity delivered to your house is never going to be even close to $0.05/kW.
And yes, I am quite familiar with the time-of-use plans. If you go solar, you’re automatically switched over to a time-of-use plan. I’ve downloaded PG&E’s price sheet for four different Time-of-Use plans, and the cheapest the energy ever gets between the 4 plans is $0.26/kW which is at night in the middle of winter. Its significantly more expensive at peak times during the summer. So switching to those plans might save you a little money, but they’re not going to be life altering either.
Solar however, over the course of a 20 year period under NEM 2.0, averages out to be about $0.11/kW right now. NEM 3.0 will double the time it takes to recoup your investment, meaning the price per solar kW basically doubles and goes up to about $0.22/kW. Sure, technically solar is still cheaper than pulling from the grid, but not much.
I’m not familiar with the 3.5-5% returns that Germany is enjoying on their power so I can’t comment on that, however, I for one would not be happy with those returns! The S&P 500 has averaged over 10% per year since the mid 1920’s. If you’re not getting a return that’s at least equal to the S&P 500, then it’s not a good investment! We’re obviously getting off topic here, but my returns over the last 20 years have significantly beaten the S&P 500 as well. So if you’re telling me solar is going to give me a 3.5-5% return on my money, I’d much rather stay on the grid and invest my money instead for a higher return. I mean, looking at it another way, if my grid connected bill is currently $200/month but I can go solar under NEM 3.0 and save 5% off my bill, that means my bill would be $190/month. Is it really worth the hassle of going solar to only save $10/month. Most people will say no. Especially like I said, even though the solar parts are warrantied for 20-25 years, the labor to replace them is not. I was quoted at $500 in labor to replace a broken inverter. All you need is one inverter to fail and you’ve already blew your 5% savings on labor costs. Not to mention the fact that now the panel isn’t producing any power while you wait for the replacement, thus forcing you to pull more grid connected power and pay even more. It’s simply not worth the risk for a 5% return.
And yes, I realize that the utilities aren’t the only ones pushing for NEM 3.0. It’s also all the fixed and low income groups. But again, we need to look at cause and effect here. Under NEM 2.0 the utilizes are receiving money for the grid via connection fees and NBC’s, and on top of that any over-generation at the end of the year they pay me a measly $0.02/kW for while they charge my non-grid connected neighbor anywhere from $0.24-$0.44/kW for my excess generated power. So they are most definitely making money off me under NEM 2.0! Under 3.0 however, people will just disconnect and the utilizes won’t receive a single dime from the solar customers. Which means even fewer people paying for the grid which means everyone still connected will definitely see their rates go up.
I also disagree that it’s the rich that are getting solar. I am not rich by any stretch of the imagination. I would argue the vast majority of the rich you speak of have already made the switch over to solar. The group that is considering solar right now is the middle class group like myself. My friends are also middle class. Enacting NEM 3.0 effectively screws the middle class, once again. The rich can afford whatever they want because they’re well, rich. The poor get handouts via the CARES act and similar programs. It’s the middle class that gets screwed once again!
Lastly, to address your statement on the fact that solar has gotten cheaper over the past 20 years so why haven’t we seen a mass exodus yet. The reasons are quite simple and straightforward:
The first is that it’s still cheaper to be connected to the grid with NEM 2.0 than it is to go off-grid. Most people are looking for the cheapest solution to solve 99% of their problems. The people that want 100% coverage and have the money are the ones going completely off grid right now. But I want to re-iterate this, it’s being connected via NEM 2.0 with the minimal connection fee and NBC’s that makes grid connection cheap, feasible and the right solution for most solar people right now. Once NEM 3.0 hits, it makes being connected to the grid exponentially more expensive! When NEM 3.0 hits you will most definitely start seeing a more dramatic shift of people going off grid. Me for one! Like I mentioned before, a NEM 3.0 connection fee of $10/month/kW means a 10kW system will cost $10/kW * 10kW * 12 months * 20 years = $24,000. That’s enough to buy 2-3 Tesla power walls. And that’s not even taking into consideration the exploding NBC’s they want to charge on top of that. This isn’t an empty threat like you seem to think it is. The math doesn’t lie. When it becomes more expensive to be connected to the grid via NEM 3.0 than it is to buy batteries, people will go off-grid.
The second reason is that the battery technology hasn’t been able to keep up yet. But as I mentioned, solid state batteries will be here soon and they’ll be cheaper and have higher capacities. Look at Lithium Ion batteries over the years. They were super expensive at first and now they’re 97% cheaper than when they were first released. Solid state is the next big advancement which will drive the cost of batteries down significantly! So while the sky high NEM 3.0 fees will be the start of the great exodus, cheaper batteries will be the catalyst that really drives people over the edge to disconnect.
As I said, this whole argument comes down to simple math. The price of the solar panels, inverters, combiner, etc, etc, are all pretty much a fixed price regardless of if you tie into the grid or go off-grid. The wild cards in the equation are the sky high NEM 3.0 fees versus the decreasing price of battery storage. As soon as batteries are cheaper than the NEM 3.0 grid connection fees, people will disconnect in droves. It’s not rocket science or empty threats!
You said you read the thread. I believe I’ve explained the two-part electricity bill idea a few times now.
Part 1: A large grid access fee. For an average customer about $90/month.
Part 2: An energy usage fee. For an average customer about $30/month.
In California, the average electricity consumption is 500 kWh/month. If each of these kWhs was 5 cents you end up with $25 in energy costs. That’s the basic math.
You can stand by your statement because it’s mostly true. The only problem is you misunderstood the other part of the equation – the grid access fee part. As you’ve aptly described, these costs aren’t going away. There’s strong evidence that BOTH distributed solar and utility solar will obviate the need for additional T&D in the future. While positive, the total benefits of T&D deferrals will measure a few degrees at most. If you were given a slice of pizza that represented the T&D savings of rooftop solar you would not be happy.
“I’ve downloaded PG&E’s price sheet for four different Time-of-Use plans, and the cheapest the energy ever gets between the 4 plans is $0.26/kW which is at night in the middle of winter. Its significantly more expensive at peak times during the summer. So switching to those plans might save you a little money, but they’re not going to be life-altering either.”
I work in power system operations. My expertise is power plant operations but I rub elbows with experts in transmission, distribution and market operations. I frequently look at what the wholesale market is doing. As I’ve long expected we’re starting to see an inversion in the pricing dynamics between High Load Hours (HLH) and Low Load Hours (LLH). There are 18 HLHs and 6 LLHs. Historically HLHs have higher prices that LLHs. This is starting to change such that the arbitrage opportunities are reversed. My point here is that solar is depressing daytime prices but our rate designs simply haven’t caught up to reality. All these folks pushing for NEM are holding us back from making the necessary changes we need to make to lubricate the integration of wind and solar.
If you don’t like the 3.5 to 5% returns on solar don’t install a PV system. It’s not the responsibility of utilities to provide you with an investment loophole that provides 10% returns. If money is what you’re after put your money in the market. From a societal perspective, utility solar and wind are a far better investment of public dollars. The benefits are broadly shared rather than smuggled up by wealthy households.
Yes… All you need is an inverter to fail and bingo bango you’re hooped. As I said, I manage power plants for a living. Many things can go wrong. Fires, floods, steam leaks, pipeline maintenance and so on. PV is an incredibly reliable technology but it too is subject to nature’s mischievous fingers.
The average solar household is wealthy. You can disagree with that statement but it’s a well-documented fact. NEM is a regressive policy that swings dollars from low and middle-income homes into higher-income homes. This is precisely why organizations like AARP, ORA and TURN have come out so strongly against it.
If you could describe the arguments for NEM as a yoga pose it would be that guy bending over and shoving his head in his hind end. Just slurping farts but smelling roses, an Escher sketch of beautiful incongruity.
Try going off-grid if you like. Again, this is an empty threat… Buy this magazine or I’ll shoot this dog… There’s also a scene in Blazing Saddles which is apt but I dare not touch that fire. A few brave souls will unplug and spring some birds at the utilities but it terribly small number. To reuse my previous analogy, if you were given a slice of pizza that represented the number of people who are going to go off-grid you would not be happy.
So let me get this straight.
For Part 1, I’m paying a large grid connection fee of $90/month
For Part 2, I’m paying $0.05/kW
You keep focusing on $0.05/kW which is where this falls apart. I, as a consumer, could give a rats behind what the generation part of the equation is. I care about the bottom line. The full bill. Using your example of 500kW for an average. That means my total bill will be a $90 connection fee plus a $30 usage fee. So my actual bill is $120/month. Divide that by the 500kW I used and that comes out to $0.24/kW. Which is still super expensive! We need to get the overall bottom line price to come down by at least 50%. The whole point of going solar is that people don’t want to pay $0.24/kW!
Also you realize your $90/month grid fee is hardly any different than my scenario right? I was using a NEM 3.0 grid connection fee of $10/month/kW, so $100/month for a 10kW system. So you’re nit-picking over the difference of $10/month??? Really?
The whole point of going solar is so that I don’t have an electric bill every month. Or if I do, it’s extremely small. That’s it, right there in a nutshell! People want a bill as close to $0/month as they can possibly get. Nobody wants to pay for a solar system on their house and then be forced to pay an additional $90/month just for the privilege of being connected to the grid. Are you insane!
You’re looking at it from the utilities point of view. Myself and everyone on here is trying to explain to you what it’s going to look like from a consumers point of view. Which is where it really matters and why we’re telling you solar is going to sharply decline if NEM 3.0 passes. Because the collective “we” are not going to get solar because it’s not advantageous anymore. I don’t understand how you can keep arguing about it on here when virtually EVERYONE on here is telling you they won’t get solar it if NEM 3.0 passes. We are the future solar customer base, not you. We’re flat out telling you, backed by our dollars, that we won’t go solar if this passes. Solar will 100% tank in the near term till batteries get cheaper and everyone goes off grid. Then you guys are really screwed!
Here’s another way to look at this. Why would I pay $30,000 for a solar system and then still be forced to pay $90/month for a connection fee. A $30k system financed at 6.99% interest for 20 years is about $230/month. Couple that with your $90/month connection fee and now my bare minimum payment is $320/month. Plus I’ll still have to pay for any extra energy I pull from the grid. The simple answer is, no one is going to do that! Ok, I take that back. Our retarded governor passed a bill a while back forcing all new houses to go solar. So yes, if you build a new house then you’re forced to have solar and you literally don’t have a choice. But for the rest of us that have a choice, why would I want to to pay a bare minimum of $320/month, regardless of how much energy I use a month? The simple answer is we won’t.
You’re also not looking at all the other intangibles:
1) Solar panels are ugly, plain and simple. Even the all black ones are still ugly, especially if you have a tile roof. I’m willing to put solar panels up on my house if it saves me a ton of money. Saving 3.5-5% is not worth the monstrosity on my roof!
2) Another thing, as mentioned above, most people are not paying for their systems in cash. Meaning they’re financing their systems. Which means my credit gets dinged and now I have a $230/month debt that shows up on my credit report and counts against my debt-to-income ratio. Normal utility bills do not count towards your debt-to-income ratio. A solar loan absolutely will. Why would I run up my debt-to-income ratio for a paltry 3.5-5% gain while still paying a $90/month connection fee? That’s idiodic!
3) Adding to the cost of solar is anyone that needs an upgrade to their roof or needs electrical work done. If you need either of these done, you just pissed your 3.5%-5% return out the window. Meaning if NEM 3.0 passes it will now cost you more money to go solar on your house than it would be to just say connected to the grid like a regular utility person. Again, forcing solar sales to plummet! PG&E needs to retrench 150 ft of line and put 3″ conduit in the ground if I want to go solar. That’s an additional $8k (probably more) to do that. If NEM 3.0 passes there’s no point in being connected to the grid. I’d rather disconnect and use the $90/month ($21,600 over 20 years) I’m saving in connection fees towards batteries. Plus I can save the additional $8k+ in retrenching fees and put that money towards batteries as well since I don’t need to worry about trenching a new line if I’m going off grid. Most people need at least a little work done in order to upgrade to solar and that adds to the price. 3.5-5% isn’t going to cut.
Here’s the bottom line from a consumer’s point of view. While we all would “like” to say we’re getting solar to be green and help the planet. The reality of it is, it’s all about the money. Solar isn’t worth it for the average consumer if they’re barely breaking even on on their investment. Definitely not if they’re going negative. The whole point of going solar is having a utility bill that comes as close to $0/month as possible. That’s the bottom line. We can go back and forth till the cows come home, but that’s the reality of it and it’s what the utility people like you aren’t understanding. $90/month for a connection fee is an absolute joke!
The full bill is 90 + 30 = 120… The cost of delivering electricity to residential customers is three parts infrastructure and one part energy. An average household in California consumes 500 kWh a month. 500 time 5 cents/kWh is 25 dollars. 90 + 25 = 115.
Stop dividing the $120 per month bill by 500 kWh to get a unit cost. You’re mixing up infrastructure with energy. This idea you have about $120 per month being super expensive is super wrong. This is the average bill in California and it’s also the average bill for the entire US. It’s also very close to what households in Germany, France, Canada and most of the other OECD countries pay for electricity.
This is why Californian’s are going solar. The prices are too high here. In most States, like New Mexico, where El Paso Power charges $8.00 per month connection fee and 12 cents per kilo Watt Hour, very few people in town get solar. PG&E is charging way too much for infrastructure costs because they are collecting from rate payers, the costs of their two bankruptcies and lawsuits from their criminal negligence. Your arguments about infrastructure costs and the fact that solar customers are not paying them after they get their solar installed is correct. it is just why pay criminals your hard-earned money to bail them out?
California literally has an average monthly electricity bill for the US and for most of the developed world. In most of the US average consumption is around 11,000 kWh per year. This means the infrastructure costs (3/4ths of the cost of electricity) are divided over more usage. This allows you to blend down the unit price of electricity.
Incidentally, the average household consumption of electricity in Germany is only 3500 kWh per year but… and the envelope, please… The monthly bill is about $120. Zoiks shaggy. It looks like Grandma Millie is also Old Man Ruffin. And I would have gotten away with it if it wasn’t for you meddling kids!
Electricity costs in Alabama are only 12.4 cents/kWh but the average monthly electricity bill in that ever-so humid place is nearly $150. Much of California has a mellow Mediterranean climate and this is why our electricity usage rates are so low and also why the unit costs tend to be high relative to the rest of the US.
The relationship between infrastructure costs, climate and the unit price of electricity isn’t terribly hard to grasp. You can say Vival La Resistance all you want but it rings hollow. Also, I must say, you seem to be biting the hand that fed you and your brothers oh so very well. As James Brown would say… I got mine, don’t worry ’bout his.
You keep trying to vilify PG&E and that’s fine… It’s really the only tactic NEM supporters have aside from wild chicken little hysteria and Orwellian doublespeak. Grandma Millie, Social Rights Advocates, Ratepayer advocacy groups and utility solar and wind interests are all against you. I believe these folks are getting very angry and NEM’s days are numbered. Once upon a time, NEM was a great jumpstart for the PV market. Those days are long gone. NEM has become a festering boil that needs to be lanced.
Lee, you keep comparing California to other places in the US and even over seas. Well here’s one for you that absolutely debunks your rhetoric.
My parents live in MN where the winters are brutal and the summers are intolerably hot and humid. Pretty much everyone has air conditioning because you need it in order to survive. The running joke is that MN only has 2 good months of weather a year and the rest are horrible.
I just asked them what they’re getting charged and they said just over 12 cents/kW. Then I asked them how many kW they used and they’re just under 600 kW last month with a total bill of just over $70. So that pretty much goes against everything you’re saying when you say they use more so it’s cheaper.
My average usage in California was just over 600 kW (before I hooked up the hot tub). I just looked at my bill and my tier 1 usage allotment is 246 kW. What a joke, who uses under 246 kW/month. No one! In any case, in the 1st tier I’m being charged a total of $0.2824/kW. Tier two jumps up to $0.35476/kW with an allotment of 738 kW. Then tier 3 jumps up to $0.44345/kW.
So my usage (before the hot tub) was roughly the same as my parents but yet my bill was almost three times higher than theirs ($195 vs their $70) for the same exact 600 kW of energy). Now that my hot tub is in and I’m using more electricity than before my bill has sky rocketed because now I’m in tier 3. So the more electricity I use the more PG&E sticks it to me.
For reference just the base tier for 246 kW at the Tier 1 price of $0.2824 is over $69. Almost as much as my parents total bill. What a joke!
If I was paying a landed price of 12 cents/kW like my parents in MN then I wouldn’t be complaining and I wouldn’t be looking to get solar and most importantly we wouldn’t be having this conversation. The issue is that California will never be anywhere near $0.12/kW which is why people are going solar. And if you start making grid tied solar too expensive, people will just disconnect. It’s not that hard to follow, I don’t understand how it’s not sinking in.
Even under your absurd $90 connection fee and $0.05/kW idea, that would mean a bill of $120 for 600 kW. Still almost double what my parents are paying for that same 600 kW of power. That’s still way too expensive!
So again, the problem is the California utilities, you know, the one you’re a part of!
You also need to stop living in fantasy land and stop telling me what California theoretically could get to. Use real numbers for California right now, not theoretical numbers from halfway around the world in Germany. I’m not living in Germany. NEM 2.0 and 3.0 don’t effect Germany, so stop talking about Germany. You need to talk about California right now with real numbers.
Since you obviously work for the utilities, here’s a challenge for your colleagues. Come up with a new proposal that drops my landed price to $0.12/kW. If I use 600 kW of energy, find a proposal where I’m paying about $70/month. If you can present a real world proposal that does that and can be backed by PG&E then I’ll be the first person to jump on board to back your plan. Until then don’t tell me the generation part is $0.05/kW, don’t tell me what Germany is doing, etc, etc. I don’t care! I care about real California landed average price per kW and what the total bill is, just like every other PG&E customer out there.
The average person is getting solar because PG&E is WAY too expensive. If you start passing more ridiculous fees onto solar customers (like NEM 3.0), which makes grid connected solar too expensive on a per kW basis, then they’ll just go off grid. It’s simple economics!
That’s a skookum cherry pie you’re making. Where’d you pick the cherries? Oh, your parent’s house in MN? That’s not unreasonable at all.
You can see the relationship between usage, price and total bill here.
2020 Average Monthly Bill- Residential
https://www.eia.gov/electricity/sales_revenue_price/pdf/table5_a.pdf
Of course, Josh has a hot tub. What type of white wine do you enjoy in your hot tub? I myself, have recently been enjoying this wonderful Sauv Blanc called Orphan Tears. You should check it out.
“What a joke, who uses under 246 kW/month.”
Poor people Josh…
I do not care about the generation part of the electricity equation. What I do care about is the absolute bottom line is. You know, the actual bill that shows up at my house every month. That is what I care about. And the total bill in your example would be $115 for delivering 500 kW of electricity. Meaning the landed price with the infrastructure costs included averages out to be $0.23 per kW.
Lets look at this another way. Fuel in California is about $5/gallon. Spit balling it here, but we’ll say $3/gallon of that goes towards taxes and delivery fees. Which means the fuel itself is about $2/gallon. When I go to the pump, do I say to myself I’m so excited because fuel is only $2/gallon? Heck no! I’m saying to myself, damn, fuel is $5/gallon, that’s expensive! Literally EVERY person on the planet speaks in terms of what the final overall cost of fuel is “PER” gallon, not the raw price of the fuel. EVERYONE!
Power is the same way, I don’t give a rats rear end what the generation part is, I care about the total bill and what that averages out to be per kW. You and the rest of your utility people need to understand that!
A $115 (total bill) divided by 500kW means the cost to deliver 500 kW of energy to my house is going to average out to be $0.23 per kW. That is way too high!
For reference, assuming you’re energy neutral where you’re using exactly what you produce in solar, the price for a fully installed solar system averages out to about 10 and 11 cents/kW over a 20 year period (and then it’s free every year after that till the system breaks down). At 10 or 11 cents/kW, that’s less than half the price of your landed grid scenario average at $0.23/kW. Which also equates to a difference of 12/13 cents/kW. Which is exactly why I’m saying, as soon as the battery tech drops below this 12 or 13 cents/kW threshold, people are going to be disconnecting.
If you want me, as a customer, to stay connected to the grid, then you, as a utility provider, should be figuring out how to slash the infrastructure and labor costs to make the grid more efficient and affordable.
Again, we can argue till the cows come home, but it’s all about the final bill. I have to open up my proverbial wallet every month to pay a bill. I am 100% concerned with what my total landed bill is going to be and what that averages out to be on a per kW basis. How many dollars do I have to hand over to the greedy power company every month. That is what we care about. And as soon as a financed solar system with batteries becomes cheaper (per month) than the total bill to be connected to the grid, you’re going to see people disconnecting left and right. It’s really not that hard to understand.
You continue to say you care about the total bill and yet you keep dividing the total to get the unit cost. The total electricity bill in California is dead average for the US. It’s literally average for most of the world. Temperate climates have low consumption and high unit costs relative to humid climates where you have high consumption and low unit costs. Interestingly, high usage climates pay about the same as low usage climates. This is due to the fact that infrastructure costs represent around 75% of the total costs of delivering electricity and infrastructure costs are relatively consistent from place to place. NEM is a loophole that allows people to escape paying their fair share for infrastructure costs.
Do you go to Elevator Manufacturer conventions and tell all the Otis people how they should build their elevators? You guys are all doing it wrong. You should figure out how to reduce infrastructure costs so that I can save money. Or else…or else… I’m going to take my cake and eat it too.
Do you know anything about energy modeling? Utilities know a lot about energy modeling and this is precisely why they’re not afraid of batteries or grid defection. Batteries are a fool’s gold technology. By far the most cost-effective way to integrate large amounts of RE is to use a combination of flexible load and over-built RE. Energy modeling suggests that the usage rates for things like pumped hydro and other storage technologies could drop below 2%. All these armchair revolutionaries talking about going off-grid don’t have the faintest clue what they’re talking about. Do you realize how much you increase your carbon footprint if you did this? Any idea how much diesel fuel you’d have to burn when your batteries run dry? Have you ever worked around diesel generators? The smell is charming and the noise… equisite.
When I look outside the window I have a view of the city. I tell you, the buildings just keep getting taller and taller. Where are they going to get their power from in this future you’re imagining?
You can continue to play this victim game but the simple fact is that low and middle-income homes are the victims of NEM. NEM is a regressive policy that allows predominantly wealthy households to avoid paying their fair share of the infrastructure costs. The coalition of groups fighting NEM includes multiple, rate payer associations, minority advocacy groups and utility wind and solar interests.
Collectively, our main argument against retiring NEM 2.0 is that the utilities are corrupt and greedy. Your main argument in favor of getting rid of NEM 2.0 is to help the low and fixed income people. Under your formula, you want to charge people a flat connection fee of $90/month and then charge them $0.05 per kW after that.
As noted in a previous post, 500 kW would cost $25. Adding in the $90 flat connection fee means the total landed bill would be $115. This averages out to be $0.23 cents/kW landed at my door when the infrastructure connection fee is added into the equation.
However, say I strike it rich and buy a mansion where my energy usage goes up to 2,000 kW a month. Using your same formula, I’m still charged the flat connection fee of $90/month and then I’d pay $0.05/kW * 2,000 kW = $100. So my total landed bill for using 2,000 kW of power is going to cost me a total of $190/month. Which averages out to be $0.095 per kW.
So….
I’m using 4 times as much energy and my bill is not even double what it was before.
I’m using 4 times as much energy, but my landed average kW price is 2.5 times less than I was paying before.
So literally, using your formula, the more energy I use, the cheaper the average landed kW is. Doesn’t that by definition favor the rich who are consuming more electricity than the poor? You know the exact thing you’re trying to avoid?
You’re doing voodoo math. The infrastructure costs are fixed. It’s only the energy costs that vary. If you add up the fixed and variable cost and then divide by higher usage you’re always going to see lower unit cost. The argument isn’t about rich people paying more or less for electricity – it’s about everybody paying their fair share for the fixed infrastructure.
The $90 flat fee is for an average customer that consumes 500 kWh per month. The fixed fees could vary by usage type. As a general rule electricity usage scales with household income. Dr. Severin Borenstein has suggested tying your monthly fixed fees to your tax returns – i.e. making fixed fees proportional to wealth.
Other ideas around restructuring fixed fees involve pulling them into the states General Fund. Here again you’d end up with Borenstein’s idea in that your fixed fees would be proportional to your income.
In an ideal world, energy costs would have some variability to encourage people to “chase” RE and avoid periods when supplies are tight. By “chasing” I mean using automated flexible loads like smart water heaters and EVs that schedule their charging.
NEM is one of the many things preventing us from exploring these advanced rate designs that will be a critical part of cost-effectively integrating renewables.
I’m making several arguments.
1. Everybody should pay their fair share for using the grid. There will inevitably be exceptions to this rule due to grandfathering and such. Just think of it as a goal. It’s astonishing that 10% of predominantly wealthy Californnia households are using a loophole to escape paying their fair share. It’s doubly astonishing how this group thinks they deserver 15% rates of return rather than the perfectly reasonable 3.5 to 5% rates of return associated with other low-risk investments.
2. We should be designing our electricity bills such that they encourage customers to move their consumption into time slots with lots of RE and away from times with short supply.
3. We need to get the unit price of electricity down to something like 5 cents/kWh to encourage the electrification of heating and transportation. These loads are flexible and have a lot of room to move around when they charge.
Solar farms now regularly generate electricity for 3 cents/kWh and under. We’re sure to reach 1 to 2 cents/kWh over the next decade thanks to the expected advances in module efficiency and a transition over to bifacial designs. These extremely low production costs make unit costs of 5 cent/kWh entirely doable so long as the fixed cost of maintaining the grid are pulled out of the unit price of electricity and turned into a monthly grid-access charge.
You don’t need every single water heater and EV to manage how it charges. Economic research suggests that having 25 to 35% of the fleet managing how it charges would deliver a ton of benefits. Evidence from France suggests that around 35% of customers will voluntarily participate in dynamic tariffs.
The combination of utility-scale wind and solar along with large amounts of flexible loads makes it so we can transition to a renewable grid quickly and cost-effectively. California has plenty of ugly dirt where solar would have limited ecological impact. The consequences of slowly moving to clean power are far greater than the impact on the Fat-Eared Snuggle Worm or whatever other silly critter the NIMBYs come up with to block desert development.
Everyone will save money. EVERYONE.
https://www.youtube.com/watch?v=74BzSTQCl_c&ab_channel=Vlkoslak
A typical household has 2 cars. If these cars were EV and each drove 12,000 miles per year you’re looking at roughly 6,000 to 8,000 kWh of electricity. At 5 cents/kWh that’s $300 to $400 per year. Average California households spend something like $3000 per year on gasoline.
There you go Josh… The rate of return on the path I’m suggesting is far greater and far more equitably shared than what we have with NEM. The CPUC needs to put the hammer down on this insidious policy.
Don’t go telling me about grid defection again. That’s never going to be cost-effective. Individual sites need far higher levels of redundancy and they don’t have anywhere near the economies of scale that utilities do.
Horse meet water. Water horse. Trust me, it’s a hell of a lot better than the Koolaid everyone is drinking here.
I’m looking at this issue as an expert in power system operators. There are three basic priorities when it comes to providing electricity.
1. Reliability (the highest priority)
2. Affordable
3. Clean
The grid is the key asset that provides reliability. The grid makes it so we can share reserves between the entire Western Interchange. If we didn’t have a large geographical grid, each individual balancing authority would have to carry far higher reserves. If you extrapolate this idea down to individual households unplugging from the grid you’d find that individual households would need to carry far higher reserves relative to what the grid currently carries to provide reliability to these households. This is very expensive. After all this, you have to maintain the system. The idea that people are going to cost-effectively ditch the grid is incredibly silly. You may as well be talking about raising a pet dragon. It’s pie in the sky bologna. Anyone who’s gone to day 1 of a power and market dynamics class has learned about all this.
People are going to stay on the grid and the grid is going to serve them. The linemen who maintain our distribution and transportation infrastructure are the heart and soul of every electric utility in the world. These guys expect to get paid for their time. People need to pay their fair share. NEM is preventing this from happening.
“I don’t understand how you can keep arguing about it on here when virtually EVERYONE on here is telling you they won’t get solar it if NEM 3.0 passes.”
This is an empty threat that is easily debunked. First off, California requires solar on new construction so that market is locked in. Second off, the 240,000 rooftop PV systems that Germany installed last year demonstrate that a lot of people are willing to take the 3.5 to 5% compound returns delivered by rooftop PV. Finally, utility-scale PV is positioned to explode if we properly restructure rates in California.
Restructuring rates isn’t some sort of hypothetical proposition. It’s an absolute necessity. The extra load we’re expecting from EVs is going to add 5 to 10 GW of additional load to the evening peak. We’re barely limping along with the reserves we currently have and all the white wine NIMBYs sure aren’t going to let us build 5 to 10 GW of gas back-up. The only alternative that I know of is to use price signals to encourage daytime charging and discourage charging during periods when RE is in short supply – specifically the evening residual peak when everybody has just plugged in their EV after getting home from work.
These price signals will make utility solar considerably more valuable because they will create extra demand for electricity that might otherwise be curtailed. These elevated wholesale prices should provide a multi-GW boost to the annual utility solar market. So EVERYONE will be buying solar electricity whether you want to or not.
If your dainty sensibilities are ruffled by solar panels on your roof then don’t install them. Maybe they’ll come out with Barbie branded panels. That would be neat.
“Here’s the bottom line from a consumer’s point of view.”
You’re simply out of touch Josh. I don’t knock on the cabin door and tell the captain he should have taken a left at Albuquerque. You haven’t spent the thousands of hours I have researching solar economics and power system operations. You’re level of understanding of the subject terribly limited. You’re getting a master class but you seem to have bionic blinders on. You keep threatening to go off-grid but you haven’t provided any examples of this happening in the real world. You keep saying people won’t accept 3.5 to 5% returns but the 240,000 rooftop solar systems installed in Germany last year are a pretty good indication that people are fine with these returns. If you’re not then don’t install solar. Finally, you keep acting like you’re entitled to saving money on your electricity bill. I’ll let you in on a little secret – you’re not entitled to getting the benefits of the grid without paying for them.
The goal of subsidies like NEM, FITs, ITCs and PTCs is to jumpstart nascent industries like solar and wind. Most of the time these types of subsidies fail miserably but in the case of wind and solar these subsidies have worked amazingly well. Solar is now the cheapest form of electricity the world has ever seen. The reason we’re shutting down coal plants at a record pace has everything to do with utility-scale wind and solar farms and very little to do with rooftop PV.
You talk about rooftop solar being ugly. What myopic corn… Coal is public enemy number one. The entire reason we’ve subsidized RE involves wiping this vile energy resource off the map.
https://www.spglobal.com/marketintelligence/en/news-insights/latest-news-headlines/more-than-23-gw-of-coal-capacity-to-retire-in-2028-as-plant-closures-accelerate-68709205
After Fukushima, it was abundantly clear that Japan would adopt Feed-in Tariffs to encourage PV to replace their nuclear fleet. Prior to Fukushima, Germany was planning to scale back their Feed-in Tariffs. All that flipped after Fukushima and that’s why we saw two more years of 7 GW solar deployments before they finally adjusted FITs down because the cost-shift was getting egregious.
The current geopolitical situation suggests many countries around the world, particularly in the EU, are going to band together and wage economic warfare against Russia in a way we haven’t seen since the coalition against Apartheid in South Africa. Russia is a resource economy and a lot of its trade involves oil and natural gas. I expect we’ll see a lot of policies rolled out in the next few months with an aim towards goosing not just RE development but also EVs and the electrification of heating. The ingredients are all there.
As I’ve already mentioned, rooftop solar generates a half pence to the pound of power provided by utility RE projects. Rooftop solar is roughly equivalent to Tesla deploying luxury vehicles to prime the market for everyone else. Utility-scale solar is the end goal of this priming process. Rooftop solar is a toy. What we need is industrial-scale solar and wind. Pedal to the metal, full steam ahead, get er’ done solar. This is my vision for how things should go and barring WWIII this is how I think things are going to develop.
And Ed over here has forgotten the entire point of being in a union. Standing side by side with your brothers and sisters. Sharing the wealth of your power.
Look at the man in the mirror and ask yourself how to change the world. NEM isn’t the thing. NEM is the opposite of the thing. A despicable incentive scheme we need to do away with.
To further drive my point, all you have to do is look at Cable TV providers. I have Charter Communications locally here. 20 years ago, Cable TV providers had a monopoly on TV programing. Then slowly Direct TV and Dish Network came in. They were cheaper and Charter lost a lot of customers. As they lost customers, the price per remaining customer has to go up to cover all the fees. Fast forward to today and now there’s internet streaming companies like Youtube.TV and Hulu Live. I for one ditched Charter a while ago and I’ve been Hulu Live the last few years. It’s cheaper than cable and it offers significantly more features. Charter’s customer base has been dying for years and their prices have to keep increasing to cover their costs. The more expensive cable tv gets, the more customers they lose. It’s a never ending cycle. The only thing saving Charter right now is their Internet service. But even that is starting to show cracks as more and more people start switching over to fiber. I wouldn’t be surprised if Charter is bankrupt in the next 20 years.
PG&E is in the same boat and on a similar path. NEM 3.0 will raise the price which means they’ll lose customers. If they lose customers, they’ll have to keep raising the prices. And if they keep raise their prices, they’ll lose more and more customers. It’s a never ending cycle. Eventually the PG&E customer base won’t be able to support the costs and they’ll either go bankrupt or someone will buy them out and significantly over-haul the company. If they want to service, they need to keep people connected to the grid by keeping the fees as low as possible. Make no mistake, they are slitting their own throats with NEM 3.0.
And as mentioned, I’m not speaking general theory here. I’m speaking from real world experience. I am on the bubble right now. If I can get in under NEM 2.0 then I’m getting solar. If NEM 3.0 passes before I’m ready, then I’m holding off till the solid state batteries come out and then I’ll be disconnecting from the grid permanently. I am EXACTLY the use-case that the utilities and other special interest groups need to be paying attention to! Because once I disconnect, and thousands like me disconnect, the utilities and special interest groups will really be screwed. And this is where it really gets dicy because PG&E and Cable TV differ on one major aspect. Cable companies, in theory, have the ability to lure customers back by over-hauling the company and offering lower rates with better service than the competitors. So they have the ability to win customers back. PG&E however is screwed. Once I buy batteries and go off-grid, there’s virtually nothing that’s going to get me to come back to the grid. Once I’m gone, I’m gone for good. That is not a good scenario for PG&E to be in. They have one shot at keeping me connected. That’s it. They need to wake up and pay attention because it’s not an empty threat, it’s a promise of what’s to come if NEM 3.0 goes forward. Again, simple math.
George Carlin once pointed out how important electricity is. Vaclav Smil, the greatest energy writer of our time, would be hard-pressed to best Carlin’s description
https://www.youtube.com/watch?v=3ZWA_cw9tss&ab_channel=smoketwibz
The Cable TV analogy is extremely weak. TV is an information technology. Information can zoom through wires or fly through the air. If electricity is flying through the air Houston has a problem. Comparing Cable TV to electricity is like comparing two words drawn from a hat. You dig?
All renewable energy (RE for short), aside from geothermal, comes from the sun. The sun goes up and down from day to day and the earth is tilted by 23.45 degrees relative to the plane of orbit around the sun. This makes it so we have diurnal cycles and seasonal cycles. Dealing with the daily cycles of RE availability is easy peasy. Managing the seasonal swings in RE availability is an entirely different game. In the winter and summer, we have extreme weather events. In a future where energy production is closely tied to weather these extreme events will also be extreme energy events. Extreme weather isn’t a new thing. Long stretches of both chilling cold and boiling heat are a thing of the past, present and future. These extreme weather events occur at synoptic scale. A synoptic event is a meteorological phenomenon that has a 1000 kilometer horizontal length. These extreme weather events combine duration and size in such a way that RE grids (or individual off-grid homes for that matter) will need to have backup fuels.
The grid makes it so we can share power over large geographical areas. It’s quite common to see electricity shipped from the Four Corners over to California or up to the Pacific Northwest. As I’ve long suspected we’re starting to see Califonia sending daytime sunshine up to the Pacific Northwest and import PNW’s hydroelectricity during the shoulder ramps (the ramp up in the morning and down in the evening). Eventually, we’ll see new electricity trading patterns that ship electricity from one latitude to the next to take advantage of load diversity.
I wrote a tongue-in-cheek article about some of this.
https://pv-magazine-usa.com/2020/11/03/too-cheap-to-keep-how-throwing-away-power-is-the-best-way-to-balance-the-grid/
The grid gives us access to geographically dispersed energy resources and a huge pot of load diversity. Big grids lubricate the integration of RE. Big grids make it so California can trade sunshine for Wyoming’s wind and so on and so forth. Big grids don’t completely protect us from extreme weather events but they provide a good deal of insulation. NEM makes it so people aren’t paying for the big grid.
This imaginary gyre of lost customers resulting in ever-escalating electricity prices is a bunch of word salad cooked up by the Rocky Mountain Institute. It’s a lawn dart of dumb. I’m not a grid expert but I work with many who are and I’ve learned a lot from them. You can keep on selling this empty threat of an idea but it’s baby talk nonsense.
The grid is the ring that binds them all. Solar and Wind are the King and Queen. Hydro, thermal storage and flexible load are your dancing knights. Price signals are your rooks and bishops. Who knows what the pawns might turn into. This is the mystery of the game. All of these players are ruled by the board. The grid is the board – the ring that binds them all. The grid is the keystone ingredient we need to reach a 100% RE grid quickly and cost-effectively.
Everybody should be paying for the ring. NEM is a nasty loophole that needs to be closed. You dig?
your Quote “We can build a 100% clean grid without any rooftop solar at all”, if utilities were behind this, would make sense, they are not. They have never been and, only by political pressure or threatening to take and replace the utilities with community solar coops, has the solar panel and wind generation taken hold. From the TVA to PG&E, fossil fuels powered utilities that power our country, and the infrastructure is totally biased toward fossil fuels. The Build Back Better plan is totally opposed by fossil fuel lobbyists and will never pass. If one wants to make a change; they must do it themselves. Reduce electrical usage through conservation and solar panel installation are the only choices given the homeowner. We do not get a choice of power companies. Private companies are building and selling the energy from solar farms, not the utilities. They claim a value charge to utilities of under $20.00 per megawatt hour of un-stored direct input electricity from these solar farms. Many are adding storage to allow more power to be spread out into the peak evening hours, but they need $50.00 per megawatt hour because the batteries cost more than the panels to build, maintain and periodically replace. The utilities, Like PG&E charge 10 cents per kilo watt hour or $100.00 per megawatt hour plus transmission and distribution charges of $160.00 per mega what hour and still they are making those solar farms wait up to 1 1/2 years to connect to the grid claiming they do not need any new electricity. They just do not want to replace the fossil fuel plants and at the current rate of transformation to renewable energy, it could take 70 years to get to be 50% renewable at this rate. My solar system is 90% renewable and if I had not taken 14 years to build it and was rich enough to build it all at once, it would have taken a year to be 90% clean. Yes, your arguments that the solar panel owners are not paying their fair shar for grid maintenance is true, but we are not using the whole grid and really don’t need the grid when we generate off grid to batteries and draw from those batteries except during a long period of dark days when we need to start up an auxiliary LP gas generator. If one only uses 10% off the grid, should they have to pay 300% of what others are paying just because they use less and are climate conscious. NEM -3.0, as written, is like Russia invading the Ukraine. Where the big utilities can squash the little homeowners just because they are Bigger and Badder and us home solar adopters are at war with the “Big Bear” Utilities.
vive la résistance!
Utilities are installing far more wind and solar than individuals are. The US installed 16 GW of wind last year and we’re expecting 8 to 10 GW this year.
The US deployed about 5 times as much utility-scale solar capacity as residential PV last year. Utility solar projects tend to come with trackers and more recently we’re seeing bifacial plants so the production per kW of installed capacity is easily 25 to 35% higher than a residential system. The production profile from Utility-scale projects also tends to be flatter which makes these systems easier to integrate. Utility deployments easily beat out residential installations despite the fact residential solar is getting paid around 5 to 10 times more than utility solar farms.
Remember that solar farm developers are part of the advocacy group opposing NEM. If we had taken all the money we’ve showered on wealthy solar households and pumped it into utility solar and the electrification of heating we’d be light-years ahead of where we are currently.
https://www.seia.org/research-resources/solar-market-insight-report-2021-q4
It’s great that you’ve installed a PV system. This doesn’t relieve you from paying your fair share for the grid. You’re simply taking advantage of a loophole that should have been closed 5 to 10 years ago. Your argument about not using the grid as much is sorta like asking the insurance company for your money back at the end of the year because you didn’t get in a car accident. Utilities provide electricity with 99.99% reliability and this costs money. When everybody is buckling down in the snowstorm the lineman are driving into the eye in their bucket trucks. And here you goofs are painting all these good men with the disdain you have for the C-Suite in San Francisco. For shame! For shame on you! If I was a few years younger I’d take a flamethrower to this place.
NEM has made it so you and 1.3 million other predominantly wealthy households aren’t paying your fair share for the grid. NEM is a regressive economic policy that is making it so that poor and middle-income households are paying more for electricity. Perhaps most insidiously, NEM has built up a large constituency of people who are opposed to restructuring electricity tariffs in a way that would promote more utility-scale RE and the electrification of heating and transportation.
I’m IBEW just like you. I know how much we make… Plenty enough to install a Tesla roof on an East Bay home. Josh over here has a hot tub and he’s crying about his electricity bill. The level of tone-deafness is off the chain, scale, chart… It’s really gone to plaid.
I’ve even demonstrated how a typical household could save more on gasoline than NEM saves you on electricity and this still didn’t sink in. It’s just clown car after clown car of soup sandwich arguments from you guys. Take out your Daddy Warbucks wallet and start paying your fair share for the grid.
“But he hasn’t got anything on,” a little child said.
3% to 5% return over 20 years? Do you now understand how mutual funds/stock market works? It returns far, far more than 3% to 5% over 20 years. In fact, on average it returns 10% per year, when adjusted for inflation about 8% PER YEAR. This means the money doubles every 10 years or so. This is 400% return over 20 years. ($100 becomes $200 in 10 years, thats 200% return, then in another 10 years $200 becomes $400, this is a 400% return on original investment). Look up any mutual fund return rate over the last 10 or 20 years. How are you now aware of this? WOW
Prior to getting solar I was paying $50 electric bill. Now with solar I pay $14 a month or so (even if I completely turn off my solar these are charges I cant avoid). Additionally, I send about 500Kw to the grid per month (over generation). This means that the electic company is making 500*0.45 = $225 off of my energy. It compensates me 2 cents for each. So $225 – (500 * 0.02) = $10.
So I pay $14, + $225 – $10 = $229 per month is my total payment to the electric company. Which is 4 times more than what they got from me prior to getting solar.
And I am not paying my fair share? Get out of here!
Josh, you are correct if they put NEM-3.0 through with the fixed $8.00 per kilo watt of solar fixed monthly fee. But what if they put through a $2.00 per Kilo Watt of solar installed “grid used as a battery fee”? Not too high, to get everybody pulling their systems off the grid, but low enough to offset some of the avoided costs that solar adopters get. And what if you did install batteries and allowed the utility to use them and pay you for the electricity at peak usage times or during weather related events, they buy the electricity from them and for that “grid availability”, wave the monthly $2.00 per month per kilo watt fee? Instead of hitting the solar adopters with a stick, lure them in with a carrot. If one has a 10,000-watt system, they are saving about $200.00 per month in California so a $20.00 additional fee plus the $10.00 connection fee all customers pay, would still be a net savings of $170.00 per month that helps pay for the solar system. Even if solar panels get to be less than 50 cents per watt, the instating, mounting and inverters will still be expensive so there will be a floor price one could never go below. In 2007, they wanted $8.00 per watt installed and last year, in 2021, it was $3.00 per watt installed. As inflation pushes labor and copper wires costs up, we may never see a rooftop solar installation less than $2.80 per watt and even though those prices give the homeowner a faster payback, even with a monthly Solar connection fee over the 2007 prices, you still have to consider, that once the fees start, they could go up at any time if they are allowed to re-write the contracts, that NEM solar adopters and the utilities sign, on any date in the future with the NEXT NEM program as NEM-3.0 tried to do to existing NEM-1.0 and NEM-2.0 customers. All future installation of rooftop solar should be able to offer an off-grid backup or permanent off-grid solutions as insurance against contract breaches from the utilities. After all, if a utility goes bankrupt and goes into receivership, all contracts will become null and void.
Edward, does your suggestion include NBC’s on top of the $2/kW system size and $10 connection fee? Are those fees static or are they allowed to go up yearly?
There’s definitely a balancing act that will have to happen with each person and each scenario. As I see it, everyone has three options:
1) Stay connected to the grid as-is.
2) Stay connected to the grid but also get solar where you hope to be energy neutral.
3) Disconnect from the grid and go solar with batteries.
The math would have to be run on each option to figure out what your total monthly bill would be and that would tell you which option is best.
For example, my 11.2 kW system that was just spec’d for me would produce 15,534 kW of energy yearly, which is 1294.5 kW/month. This system would roughly cost me $30k after tax incentives. Taking out a loan at 6.9% for 20 years would give me a payment of $230/month. This would be my cost for just the solar equipment for options 2 and 3. This does not include any roof or electrical panel upgrades.
If I used your proposal of a $10/month connection fee and $2/month/kW system size, that means I’d be adding in $32.40 in PG&E fees, bringing my option 2 total to $262.40 if I’m energy neutral and there are no NBC’s. If there’s an NBC fee, then an estimate on those has to be added in as well. If the fees are allowed to go higher each year, that needs to be accounted for as well because we both know PG&E is going to stick it to each customer and raise that fee as high as they can legally go every year.
Under the assumption of no NBC’s and the fees are static though, then $262.40 is cheaper than what I’m paying now and it would be cheaper than getting solar with batteries. So while I like NEM 2.0 better, I could possibly get behind your proposal. But only if there’s no NBC’s and the fees are static.
Using my above scenario though with NEM 3.0 is an absolute solar killer for me. NEM 3.0’s proposal of $8-$10/kW in system size would mean my connection fee would be between $89.60-$112/month depending on if it’s $8/kW or $10/kW. This brings my total bill each month to $319.60-$342/month. And that’s not even including the big jump in NBC’s that they’re proposing under NEM 3.0 as well. My savings would be minimal at best but there’s also a chance I may be paying more per month for grid connected solar under NEM 3.0 than I am being just a normal grid customer. This is why we’re all saying NEM 3.0 is a roof-top solar killer.
Your suggestion is not quite as good as NEM 2.0, but it’s significantly better than NEM 3.0.
There is a fourth option. Stay connected to the grid but use it only when your own systems batteries need to be charged when the sun does not shine, and your batteries are below 20%. I put uninterruptable power supplies (UPS) around my home and plugged everything I could into them. i then replaced the 4-to-7-amp hour batteries with 35-amp hour batteries that connect by #6 copper wires to my big battery array outside my home. (all wires are properly fused for current limitations of wiring and each device.) This gave me 8,000-amp hours of continuous battery power for my home when charged. I then put time clocks or remote-controlled wall switches from my normal grid tied electrical system to the UPS units. At the push of a button, I can remotely switch from the battery system to the grid or back again. Time clocks are used to disconnect from the grid from 4:00 PM to 9:00 PM to not use the expensive utility peak hours electricity. Since the battery system is 12 Volts, the same voltage the UPS units use as back up, there can be no mixing with the utilities 240 volts AC system therefor no NEM contract or fees are involved on that system. There is also no utility mandated limitation on its size or complexity.
Lee is obviously a paid, fear mongering consultant. it almost seems like he genuinely believes his own nonsense now. How does the highest concentration of solar in the country have the highest rates in the country behind hawaii, a literal island with no access to the national grid? because sdge need to fund propagandists and lobbyist like lee. rich vs poor. good grief. dig deeper lee.
AARP has filed an official brief against California’s NEM policy. The California Alliance for Retired Americans has also come out against the policy.
This link lists a ton of groups that have come out against the policy. You’ll notice the opposition is coming from a diverse set of parties and not just IOUs. The IBEW is among them.
https://fixthecostshift.com/september-letter-to-cpuc/
Many organizations have come out against the current NEM-2.0 because they don’t own solar panels, or they want to discourage rooftop solar preferring the large solar farms of 200 megawatts or more because they create good higher paying union Jobs. I also agree that NEM-2.0 rewards people for NOT installing batteries as part of their system for nighttime use. The utility is NOT a battery, and the electricity sent the grid is not stored but re-sold to the neighbors with little or no gain to the utility. it is almost like the utility has lost 10% of its residential customers and the other 90% of residential customers must make up for it. But the utilities also give away a lot of free electricity in their programs for the poor, but it is really not FREE. The 16% of residential customers, with the 20% discount on the CARE program are basically subsidized by the rest of the rate payers also. Adding a “Utility as a Battery” sur charge to solar paneled homes, that do not have battery storage that can be tapped in times of power shortages by the utility as well as used by the homeowner, would make sense. Giving 1 kilowatt hour back for ever 2 kilowatt hours placed onto the grid, by solar panels or windmills, would also make sense if one could install up to 200% of the previous year’s usage of solar panels rather than the 115% currently allowed. But the NEM-3.0, as proposed, would charge all solar customers $8.00 per kilo watt per month of solar installed and only give back one kilo watt hour for ever five kilo watt hours, put on the grid, would make solar ownership and tying to the grid, financially incompatible. All new rooftop solar would-be self-islanding, Off-Grid and then the utility would lose those customers like the people that went off grid in Hawaii and Puorto Rico. Show us a plan, that works for all, and we will see.
California’s electricity rates bills are dead average for the US. The unit price for electricity is high in California because the average household only uses 6,000 kWh per year compared to a US average of 12,000. This means you need to cover fixed infrastructure costs over fewer kWh.
CARE is definitely a support program but there’s a gigantic difference between subsidizing the bottom 20% and subsidizing the top 10%. NEM is currently creating a $3.5 billion cost shift from predominantly wealthy households (like yours with your Tesla roof) to middle and lower-income homes. Most energy economists agree NEM is a highly regressive policy. This helps explain why all the ratepayer groups like TURN are mad. Look at all the retiree groups like AARP that are filling briefs against NEM. The same goes for Hispanic and Black groups. Solar skews affluent, white, older and male.
https://fixthecostshift.com/september-letter-to-cpuc/
We can dance around the math all day long but the simple fact is that most of the costs of providing electricity are tied to maintaining transmission and delivery infrastructure. A typical electricity bill in the US is around $120 per month. About $90 of this is for maintaining infrastructure and only about $30 is energy. You can cross-check this breakdown by looking up the wholesale price of electricity at different trading hubs – Palo Verde, MID-C, etc… It’s currently around $50 per MWh. A typical home in California uses one-half a MWh of electricity a month – i.e. $25.
If we want the electrification of heating and transportation to succeed we need to restructure our electricity tariffs such that we pay a much smaller price per kWh (something like 5 cents/kWh). The basic idea is that you’d pay $90 per month as a fixed charge (your grid membership fee) and around $30 per month in volumetric fees (energy fees). This restructuring will have a negative impact on rooftop solar but the benefits to everyone else would be at least 10 to 1 higher.
If we had 5 cent/kWh electricity a typical 2 car household would go from spending over $3000 per year on gasoline to something like $500 to drive on electricity. If we had 5 cent/kWh electricity a typical household could be heated (space, water & cooking) for around $500 per year compared to $2000 with natural gas. These types of benefits can be enjoyed by all households – not just those who are lucky enough to have the space to install solar. Ask not what your country can do for you…
You may want to reconsider your position on utilities vis a vis how they compare to batteries. For a long time now we could see that mid-day solar was going to displace traditional sources of daytime power. In California this means gas and hydroelectric plants and also imports (CAISO imports roughly 30% of their total electricity). If you go back and look at CAISO’s generation profile in 2010 and compare it to today you’ll notice that our gas and hydroelectric plants have moved their operations away from the middle of the day (the High Load hours) and into the shoulder periods (the morning ramp and evening residual peak). You’ll also notice that imports have shifted in a similar way. You’ll also notice that the California Aqueduct Pumps (the largest single load in California) have adjusted their operating hours away from the middle of the night and into the middle of the day. If you look into the operating hours of Helms you’re like to find water frequently being pumped uphill with weekend sunshine.
These new operating dynamics may not make utilities batteries but I’d say they’re functionally equivalent.
Why in the world are we subsidizing the installation of rooftop solar on wealthy households like yours? I reckon we could get about 100 times the number of clean kWh by targeting a similar level of subsidies towards the electrification of heating and transportation. I can’t show you a plan that works for everyone but I can show you one that works for the vast majority of us. The folks with first class seats on the gravy train aren’t going to be happy but the people in steerage sure will be.
Lee Kasten The fact that the NEM-2.0 is skewed to benefit the person that paid all that money for the Solar Roof or Solar panels is true. Tt was designed that way. PG&E even paid people in 2004 to install solar with a 12% Cash rebate. But here is the bottom line. The total rooftop solar counts for only 3% of the energy going onto the grid at this time and used off the grid by the homeowners. The other programs are 16% of the users getting subsidized because they are poor. It is the “middle class” that mostly installs solar in California to get out of the higher, overpriced tiers the utility charges. Middle class homeowners are paying for both the CARE program and for the offset from the solar panel roofs and are getting squeezed in the middle. I have suggested a “Solar utility as a battery fee” for all customers that have solar and an increase in everybody’s base connection charge to pay for the necessary electrical storage that does not exist yet but will be required for intermittent production like solar and wind farms and rooftop solar. MEM-3.0 made the solar rooftop customers the whipping boy for all of the utility’s short comings.
I pay $80.00 per month for my battery system and that makes my electricity, I generate, off my Off-Grid system, more expensive than my Tesla Solar Roof that does not have batteries because the Grid becomes my battery for that system. Instituting a battery substituting fee for non-battery solar customers and using that money to help install batteries for grid stabilization and micro grids for power outages would be a welcome change but telling solar customers also that they have to give five 5 kilowatt hours of energy to the utility and get back only one kilo watt hour in exchange plus the fee would kill all on grid systems and all those costumers would be gone anyway and what you have left would be all the non-solar customers picking up the costs alone..
Every last home with a Tesla roof has a wealthy homeowner sleeping under it. Who else but the wealthy have that much money to burn on bragging rights? While there are many low to moderate-income solar homes there is no doubt solar skews toward higher incomes. Most solar homes have income levels reaching up into the top 10%. This puts the majority of solar households into a semi-rich class one philosopher has labeled the new aristocracy. This group has a hard time recognizing how they benefit from structural inequalities.
I say again, why are we subsidizing wealthy people? Perhaps more importantly, why are we showering so much silver on a sliver of the pie when there are far more cost-effective clean energy technologies? It’s wonderful that solar households are making clean electricity but we can make clean electricity five to ten times less expensively with solar farms. Just the small portion of the Mojave that’s currently open for solar development could host over 50 GW. Utility-scale solar and wind are the future of the grid. Rooftop solar is a half pence to the pound of power these large-scale projects are going to deliver.
Finally, I must say, you’re being rather cagey about this off-grid system of yours. First off, why would a modest house in the temperate East Bay have an electricity bill with so much consumption in the higher tiers? Secondly, why do you care about NEM 3.0 if your system is off-grid?
vive la résistance!
Lee Kasten, you mention all those big solar farms cost less, but did you know there has to be a lot of infrastructure built to get to them. My Tesla Solar Roof too just 11 days from the city inspector’s approval to “power on”. PV magazine just reported that “Of more than 2,000 solar, wind and storage projects in PJM, one-third have been waiting for more than 500 days, the post says. That compares to the neighboring MISO grid region, which “is working to reduce its timeline for an interconnection agreement from 505 days down to 373 days.” That is over a year to connect to the grid from way out there and who is paying for all those new transmission lines? The rate payers, that who. Who paying for my system? I Am!
vive la résistance!
It’s quite the other way around Ed. In California the big farms are close to load centers so the added high voltage infrastructure is minimal. Studies are starting to show that intrastate solar farms will reduce the need for additional interstate and interregional transmission. We’ll be able to see this in California as a steady reduction in electricity imports. We also know that over-building solar farms dramatically reduces the need for storage.
I’m not saying you didn’t pay for your system. I’m saying you’re not paying for the grid you use for backup power – everybody else is covering you. Multiply by 1.3 million and you end up with a 3.5 billion dollar cost shift. Not only are all these people not paying for the grid, they are now actively resisting the rate restructuring we need to make the electrification of heating and transportation affordable.
Dozens of ethnic advocacy groups have noticed their constituencies are paying higher bills as a result of NEM. Multiple ratepayer advocacy groups have as well – TURN, ORA. Multiple retiree advocacy groups have also come out against NEM. Even renewable energy advocacy groups have come out against NEM.
Some quotes:
“You overbuild by 50% and you decrease your storage energy requirements tenfold,” he says.
He says the strategy would save money, even though all that solar would produce more electricity than needed in summer.
“It seems wasteful,” Perez says. “But the alternative is to overbuild the storage tenfold, and that is wasteful, in my opinion, both economically and environmentally.”
https://yaleclimateconnections.org/2021/11/a-simple-idea-to-address-fluctuations-in-solar-energy-production/
This paper found that intrastate solar and wind reduce the need for interstate transmission.
Geophysical constraints on the reliability of solar and wind power worldwide
https://www.nature.com/articles/s41467-021-26355-z
Then long-term energy storage in either hydrogen gas generation and compressed or pumped hydro that puts water back behind hydroelectric dams, keeping long term hydro storage, could use all that extra solar and wind energy to provide power in the winter times or at night. So, what is the cost of such a re-cycling of energy system cost of the produced energy? Batteries have a 15% loss in the cycle but are only over night or short term. Hydro pumping also has about a 15 to 25% cost in the cycle. Compressed hydrogen from electrolysis is about a 50% cost for the full cycle from cold water. If homeowners put unused energy onto the grid and it is put into storage with a cycling cost deducted from the value of the inputted energy, would a 50% discount be a fair offset for long term storage. The homeowner generates 2 kilo watt hours onto the grid for storage and gets one kilo wat hour back of the recycled electricity. The utility would need to lift the 115% limitation, as they did in the proposed NEM-3.0, to 200% of the homeowner’s previous non solar electric bill to cover the full energy cost of the full cycling of long-term storage ending that cost shift. The infrastructure cost shift could be covered in a monthly fee based, not on how much power is produced, but by how much power is used and this would be on every home, business or government customer and this already built into the system as part of the kilo watt hour tariff. The smart meters already tell the utility how much the homeowner uses as well as how much is produced by solar generating inverters. All the grid tied inverters installed since June of 2020 had to be able to communicate with the utility in California so they could count that production as part of the California 50% renewable plan. We also have a tiered tariff system that bills higher usage customers a higher price per kilo watt hour above a baseline amount of 10 kilo watt hours per day. We also have a time-of-day billing on top of that that charges 35% more for energy used between the hours of 4:00PM and 9:00 PM daily. Since solar customers produce all or most of the energy before the peak time billing, and they only get paid the lower tier 1 benefit IOUs from the utilities, they are in fact paying their fair share of the infrastructure because they are paying more to buy back the energy that they sent out onto the grid. if the utility wants to get more compensation from solar users, then let them pay in Kilo Watt Hours on larger systems rather than in dollars out of their pockets so the utilities can profit through electricity sales and cover the infrastructure costs that way.
You believe what you want to believe Ed. I believe refugees are bleeding from your benefit.
The ratepayer organizations don’t think you’re paying your fair share for infrastructure. The retiree organizations don’t think you’re paying your fair share. Utility wind and solar developers don’t believe you’re paying your fair share.
I have solar and I am not rich! Blaming the rich Seems to be the new flavor of the month in America. Hey rich people thanks for doing your part in saving the planet.
Amen Tom W.
Boy oh boy, Infrastructure moneys are the motivation for new definitions of the word.. I believe that a big chunk of funds from our infrastructure bill have the potential to bring substantial, sustainable, risk- free rock-solid economic stability to our nation, and “Solar Panels on Every Roof-top” Can be a new turn of the old phrase. The possibilities are probabilities, in my mind. United States resources, USA manufacture, assembly, transport, installation of solar panels? I am a layman, but it seems obvious to me that life without conglomerates “too big to fail” would put a big dent in “the national debt”, no?
After the 2002 Enron and de-regulation of energy companies the abuses caused PG&E to go bankrupt. To get out of bankruptcy, the CPUC said PG&E could raise its electrical rates. TURN, an advocacy group for the poor set up a tiered system with PG&E that would charge high users up to 4 times more than the low users. Low users paid 12 cents per kilo watt hour delivered and large homes to tier was 48 cents per kilo watt hour over 980 kilo watt hours per month. The utility needed 16 cents per kilo watt hour to profit and netted 22 cents per kilo watt hour with this plan and paid their top 80 executives a 1 billion dollars in bonus the following year. It was at this time, the larger homes, mostly upper middle class with air conditioning, started buying solar panel systems to cover their $800.00 electric bills. This is when I started building my off-grid system with batteries. Getting out of the top 3 tiers of 24 cents, 36 cents and 48 cents was my only goal at the time. Now that I know more about global climate change and how slow governments are working to slow it down, my goal now is to be 100% carbon neutral on my home and tell as many people as I can how to do it also. This makes me BIG OIL, Big Natural Gas and utilities, “enemy number one”. This also puts me in the ranks of Gretta Thornburg, Bill Nye and Al Gore as climate science believers. It also makes me the enemy of the Robinhood organizations that want to shift all the costs to the rich when I believe we should all be in this together. I am not rich. A 1,200 square foot home and on fixed income I am trying to make every dollar count and when PG&E charges 30 cents per kilo watt hour and I can cleanly generate my own power for 16 cents per kilo watt hour, I call that a win/win. PG&E has just raised its Natural Gas prices by 90% this year and this year my Tesla Solar Glass Rood generated enough energy that I turned off my fan forced gas furnace and ran electric heaters on the 3-cent true up electricity they would have given me.
I believe rooftop solar is more like 5% of total electricity consumption in California and/or 15% of total residential electricity consumption. A large portion of this generation is displacing electricity consumption which was previously priced in the higher tiers. This means the impact on residential electricity revenues is necessarily higher than 15%. The 3.5 billion dollar cost shift suggests the previous income from the solar households was somewhere around 20% of total residential electricity revenues. You can channel-check the validity of this estimate by considering that solar is on roughly 10% of all the homes in California and solar homes, on average, consume around twice as much electricity as non-solar homes. This revenue hasn’t been lost – it’s simply been put on the backs of non-solar homes. This is why we have organizations TURN, ORA and AARP screaming for NEM to be scrapped.
I believe in science too. I also believe in economics and social equity.
On my previous post, I forgot to mention the 30% tax credit that I got on my system from 2007 thru 2018 that makes it 16 cents per kilowatt hour off-grid. With the 22% tax credit and the higher prices for copper wire today it would now cost 18 cents per kilo watt hour. PG&E just announces a 10% increase in their electricity tariffs so their 26 cents per average kilo watt hour is now going to be 28.6 cents per kilo watt hour starting March 1st, 2022, and they have even more increases in the works for later this year to cover the losses due to the California Fires and criminal lawsuits for negligence. Since my annual usage is 14,400 kilo watt hours in 2007, my tier two bracket costs would make my costs 30 cents per kilo watt hour. In 2022, I just received a message my true-up is negative and I have incurred $0 usage charge and a $120:00 grid connection charge that i have been paying for monthly at $10.00 each month along with my gas bill of $40.00 for my hot water heater each month since I no longer use my gas furnace.
vive la résistance
Lee Kasten, you seem to have no idea how NEM2.0 works. You do know about NBCs (non bypassable charges) that every solar owner pays to the solar company right? You are also aware that a solar owner generates 1Kw of electricity. Sends it to the grid. He gets about 2 cents for that killowant (retail rate) from the utility. Due to how electricity flows (physics) it goes to the neighbor’s house, who then pays 40 cents for that 1Kw. Electricity traveled all of 50 feet over 0000 AWG wire (about $2 per foot and lasts ~50 years) and the electric company just made 2000% profit while doing absolutely nothing. They didnt buy the solar panels, they didnt install them, they didnt pay for their installation. All they did was run 50 feet of cable for $100, which paid for itself in matter of days.
Now in the same situation if solar was not involved, the utility would buy that 1Kw for the same 2 cents from a thousand miles away, it would utilize thousands of miles of infrastructure to get to the house. So now the cost to actually deliver it is much higher.
If everyone had solar then infrastructure being used would only be 50 feet from 1 house to the next. Easily paid for and maintained.
Also, you dont have to be rich to drive a Tesla or have solar. Go to any UC school, 21 year old graduating and entering workforce used to buy Honda Civics. Now they buy Tesla Model 3’s.
So explain to me how solar owners dont pay their fair share, how non bypassable charges we pay every month even if we generate 0 energy or pull 0 energy from the grid, we still pay a bill with the current system. Also explain to me how electric company making 20 times (2000% profit) on my electricity is not enough to pay for infrastructure. What other industry can someone make 2000% profit day after day for years without doing anything?
I don’t think you know as much about NEM or power system operations as you think you do.
We’re not talking about Tesla cars – we’re talking about Tesla roofs which are shockingly expensive. You have to have a huge amount of discretionary income to install this type of PV system.
There are dozens of low-income advocacy groups fighting NEM. These folks aren’t going away.
https://fixthecostshift.com/supporters/
My quote, from Tesla, for my 7,850-watt Solar Glass roof was $32,650.00 and after all the repairs my roof needed including new plywood the total came to $38.750.00. The quotes I got from other solar contractors were $42,000.00 on a traditional asphalt roof plus 8,000 watts of traditional rooftop solar and that did not include the hidden dry rot and repairs or a new wood base. I understand the Tesla charges more for roofs that have more sections because of the peaks and valleys on a roof require mor intensive labor. Mine has 4 surfaces 2 peaks and two valleys so mine was a lower bid than my neighbor up the street that had 9 surfaces. My neighbor put on an asphalt roof and 4,000 watts of solar with one Powerwall for $54,000.00. There are some people on this site that would discourage you from getting solar and belittle you for being part of the fossil fuel resistance. if you believe that climate change is real, then vote with your dollars and get solar panels for you roof or backyard.
vive la résistance!
3% to 5% return over 20 years? Do you not understand how mutual funds/stock market works? It returns far, far more than 3% to 5% over 20 years. In fact, on average it returns 10% per year, when adjusted for inflation about 8% PER YEAR. This means the money doubles every 10 years or so. This is 400% return over 20 years. ($100 becomes $200 in 10 years, thats 200% return, then in another 10 years $200 becomes $400, this is a 400% return on original investment). Look up any mutual fund return rate over the last 10 or 20 years. How are you now aware of this? WOW
Prior to getting solar I was paying $50 electric bill. Now with solar I pay $14 a month or so (even if I completely turn off my solar these are charges I cant avoid). Additionally, I send about 500Kw to the grid per month (over generation). This means that the electic company is making 500*0.45 = $225 off of my energy. It compensates me 2 cents for each. So 500 * 0.02 = $10.
So I pay $14, + $225 – $10 = $229 per month is my total payment to the electric company. Which is 4 times more than what they got from me prior to getting solar.
And I am not paying my fair share?
Bernie Madoff’s fake fund consistently returned 10% per year. This is absolutely unheard of. Returns of 6% are considered a slam dunk investment.
If a PV system pays for itself in 20 years that’s a decent investment. A compound return of 3.5 to 5% will result in a payback period of 15 to 20 years. All the folks supporting NEM seem to want pyramid scheme-type profits.
Your story doesn’t make much sense for a couple of different reasons.
1. It doesn’t make much sense for you to have a solar system if you were only paying $50 per month. The average bill in the US and California is $120 per month so at $50 you are an extreme outlier.
2. Backfeeding 500 kW means you’re system is over-sized by around 4 kW. As I mentioned the average bill in California is $120 per month and this is for annual consumption of around 6000 kWh.
You had a small bill before which implies very low consumption. If you have low consumption you’d only need a small PV system. Certainly, nothing that would back-feed 6000 kWh per year. Frankly, backfeeding this much extra is absurd.
3. But now later you’re paying $229?
Your post is a multi-layer sundae of inconsistencies. If you used to pay $229 and now you’re paying $14 the answer is YES, you are not paying your fair share.
Wow, are you serious? Look up VTI, which is a total market index fund, of VTSAX, which is a mutual fund and click on 5 year return. its a 74% return in 5 years. And thats after it has been falling for 2 months. You have no idea what you talking about when it comes to market returns. Average return of 8% after adjusting for inflation is a fact, an easily checked fact. Im not going to prove anything to you, just go look for yourself.
Now to your other points. No, my system is not oversized. In the summer I overproduce 400Kw. In the Winter I am dead even due to shorter days and bad sun angle.
No one would buy solar if it paid for itself in 20 years. Because its life expectancy is 20 years. And thats assuming zero maintenance. Which everyone knows is not the case. Its a losing proposition at 20 years. Plus why would I go through the effort of doing it if there is zero incentive? What you are arguing for is essentially going to work, and then instead of getting paid dollars have employer just cover all your expenses. No extra dollars for you. Why would you do that kind of work?
Lastly. Yes my bill was $50 a month. And I got solar. Because I like having a $12 bill + NBCs over $50 bill. It locks me into NEM 2.0 and allows me to use more energy later (when family grows, electric cars are added etc).
You seriously seem to be some sort of shill for something. Zero understanding of the issue, just botting away at an agenda.
“Historical returns on safe investments tend to fall in the 3% to 5% range but are currently much lower (0.0% to 1.0%) as they primarily depend on interest rates.”
https://www.thebalance.com/what-is-a-good-return-on-investment-2388458
Lee, its really hard for us to take you seriously when you obviously have no grasp of finances and investments. The safe returns you speak of are typically the number that financial advisors tell their clients when they’re retired, or about to retire, and they’re looking to preserve their capital, not grow it. Those people have already made their fortune and they just want to make sure they don’t lose it while in retirement. They can’t afford to weather a bad year or two. Thus the safe bond returns you speak of. Maybe you keep touting these numbers because you are retired yourself and that’s all you’re familiar with, I don’t know. Also, these safe bonds you speak of have been performing absolutely horribly the last few years by the way! Very south of the 3-5% average you’re trying throw at us.
Solar is a long term investment, 20+ years. Any financial advisor worth their salt would advise against bonds if you have 20+ years ahead of you. Every one of them would suggest a good growth mutual fund.
And this is exactly what we’ve all been telling you. Which btw, can very easily be backed up with a basic elementary web search which you refuse to do. The S&P 500 has an annualized return of over 10% since the 1920’s. Even if you know absolutely nothing about investments you could stick your money into an index fund and be averaging 10% a year. Yes, some years are well above that, some are lower, but the annualized returns over the long haul have been over 10%. That is not my opinion, that is a 100% fact!
Fidelity and Vanguard are two of the largest fund managers out there. Use your fingers and navigate to their respective sites and organize their funds by historical averages. There are tons of them that historically have averaged double digit returns. And these are regular old mutual funds. We’re not chasing the next hot stock, bitcoin, or any other crypto here. We’re talking regular old boring mutual funds.
You also realize that inflation was 7% last year right? So if you only made 3-5% last year, you actually lost money last year. Your purchasing power would have went down by listening to your advise. Cue the sad clown music! Ok, so maybe you can say that last year was a bad year for inflation and that it’s typically not that high. Well, interestingly enough, historically, the annualized inflation has been around 3% since the 1920’s as well. So if you’re only making 3-5%, you’re either breaking even or barely making any money once you take inflation into consideration.
So please, just stop telling people they should be happy with 3-5% over the long haul, that’s absolutely horrible financial advise!
There are literally thousands of financial advisors out there. If they tell their clients to be happy with 3-5% returns they’d be out of business really fast. Especially when a plain Jane S&P 500 index funds would give them an average annualized 10% return over the long haul with no financial advisor needed.
At some point you need to look at yourself in the mirror and realize you’re standing alone and giving out horrible advise. Maybe a little self inflection here. In either case, please stop telling people to be satisfied with 3-5%.
Vanguard Wellington fund lifetime returns- 8.42% since inception date (07/01/1929 A balanced fund that is 60% to 70% stock and 30% to 40% bonds.
Dodge and Cox Balanced Fund- 8.36% Fund Inception Date (June 26, 1931) A balanced Fund that is 60% to 70% stocks, 30% to40% bonds.
keep this as a handy reminder of the overall market for investments and to will an argument with “know it all’s” that know nothing at all.
The Ned Beatty NEM is giving to low and middle-income ratepayers in California.
Germany installed nearly 240,000 rooftop PV systems last year.
https://www.cleanenergywire.org/news/solar-module-installations-10-germany-2021-mandatory-solar-roofs-two-states
Here’s a PV Magazine article about the 20-year paybacks that rooftop PV has in Germany.
https://www.pv-magazine.com/2021/11/12/high-pv-system-prices-falling-fits-make-small-solar-unviable-in-germany/
These two data points provide a real-world example of a healthy solar market despite low returns. This all makes more sense if you understand the basics of portfolio theory. PV is a low-risk investment and these types of investments come with 3.5 to 5% returns. If cloudy Germany with it’s 900 kWh per kWp can do 240,000 rooftop PV systems a year you’d think the Sunshine State with it’s 1500 kWh per kWp should be able to do alright.
https://www.investopedia.com/articles/basics/03/050203.asp
Note how this quote points out how rare 5% returns are safe investments. You guys seem to want to compare PV to different classes of investments. And then you’re insulting me as if I’m the dummy in the conversation.
“Since there are very few completely safe fixed-income investments that pay anything close to 5%, you’ll need to spread your portfolio over several different asset classes to produce that kind of return.”
https://www.mybanktracker.com/blog/investing/invest-5-percent-return-299752
You are free to invest where you want to invest. If the S&P delivers 10% go ahead and put your money there. The money you earn from an index fund isn’t making the electricity bills of low and middle-income households go up. The money people make on those investments isn’t creating a constituency with a perverse incentive to hold back rate restructuring. NEM is a terrible incentive program and I believe you’re going to see the cost shift problem becoming social equity issue at the national level. I think the gears are already in motion.
I know you frequent the Haas blog. Notice how my arguments here on this thread are similar to what Bushnell is saying. NEM isn’t a stepping stone onwards and upwards. It’s an anchor pulling down a sinking ship.
“Critics of the CPUCs proposed decision point to the fact that in the parts of California where NEM has already been changed – places, by the way, with publicly-owned utility systems and not “profit-seeking” investor-owned utilities – solar installations have declined sharply. The implication is that this is in turn stalling progress toward renewable energy goals. That’s just not true. This perspective ignores the fact that residential rooftop solar isn’t the only way to generate clean electricity. It’s not even the only way to generate solar electricity. It is only the most expensive way to generate clean electricity. ”
“The proposed monthly fixed charge (e.g. solar tax) is simply a means of recovering the fixed costs of distributing electricity in California. But we shouldn’t stop at only the solar homes. The road to electrification is to shift everyone to a rate structure that encourages electrification, one that accurately reflects the high costs of connecting to the grid and the low costs of actually consuming electricity. ”
“This means moving everyone to a monthly connection charge and lowering the marginal price of electricity by an amount that offsets the revenues raised by the connection fees. It’s not a revolutionary idea. Lots of electric utilities already do it. Our gas utilities in California already do it. In fact, California’s CPUC regulated electric utilities are about the only utilities in the country to not charge a monthly connection fee.”
https://energyathaas.wordpress.com/2022/02/14/everyone-should-pay-a-solar-tax/
How many LCOE calculators have you built from scratch Josh? How many business people and economists do you talk to about solar power? How many man-hours have you spent studying solar power? Is it in the thousands? Is it in the tens of thousands?
So far as economic returns go I’m mostly drawing from Jigar Shah’s book but I’ve also spoken to project developers over the years about their returns. I quoted you the 3 to 5% stat from a website and provided a link. As I said, I can’t force you to drink the water.
Have you ever heard of portfolio theory? Harry Markowitz won a Nobel prize for his work on portfolio theory. The idea of portfolio theory is that you build a collection of diverse investments with various risk profiles. You get a pretty basket and you put a high-risk investment in it. You get another pretty basket and you put a low-risk investment in it. Rinse repeat. This type of investment strategy leads to far more stable returns than you get with one-basket investments. As you well understand, high-risk investments have high expected IRRs. What you don’t seem to understand is that low-risk investments, which rooftop solar is, have lower expected IRRs. You think you deserve high-risk returns from a low-risk investment. Wonk…Wonk…Wonk… You don’t. If you think you can get 10% returns from the market then go ahead and put your money there. You don’t deserve those sorts of returns from a low-risk investment like rooftop solar. Germany has a healthy rooftop solar market with 3.5 to 5% rates of return. In 2021, they saw the installation of roughly 240,000 rooftop PV systems. That’s a whole lotta power saying I’m right and you’re wrong.
@Josh Thanks for posting and illuminating the issue. Completely agree with all your points.
I just read through PG&E pitch on the issue, and despite what Lee here is not saying, seems like the NEM3.0 goal WAS to push folks to use their own batteries/storage. Or at least one of the goals. They’re stating that servicing NEM2.0 customers is costing the utility companies more than they’re getting back in terms of energy reserves.
Hopefully the storage solutions are coming in the near future as you say, and we’ll get there. DE incentivizing solar now, is the wrong move.
Quote:
Assembly Bill 327 (Perea, 2013) required the CPUC to reform its existing NEM program, as well as conduct rate reform and distribution planning activities. The CPUC revised the NEM program in 2016 and created “NEM 2.0.”The CPUC initiated its current reform of NEM 2.0 in August 2020.
The CPUC is ensuring the NEM program complies with statutory requirements including:
Ensuring that customer-sited renewable distributed generation continues to grow sustainably;
Including alternatives designed for growth in disadvantaged communities;
Basing the tariff on the costs and benefits of eligible renewable electrical generation facilities; and,
Ensuring the tariff’s benefits to all customers and the electrical system approximately equal its costs.
There is a clean energy shortfall in the evening hours when the sun is down, which forces California to rely on fossil fuels to meet evening demand. One solution to the problem is distributed storage, but the current NEM program lacks the price signals necessary to incent storage adoption, thus less than 10 percent of existing NEM customers have paired storage with their solar systems.
All ratepayers pay as much as 10 times more for exported NEM energy than for other sources of renewable energy.[3] Californians today spend more than $3 billion a year to support NEM programs.
An independent third-party evaluation of NEM 2.0 found that its costs substantially exceed its benefits as residential NEM 2.0 participants only pay 9 to 18 percent of what it costs their utilities to serve them, even considering the value of the energy produced by their NEM systems.
Under NEM 2.0, the typical solar customer pays for the solar energy system through energy bill savings in 3-5.5 years depending on utility[4], and then receives substantial bill savings for the remainder of the current 20-year tariff.
Ratepayers without NEM systems, who are disproportionately low-income, pay significantly higher electricity rates due to NEM. The Public Advocates Office at the CPUC estimates that low-income households without NEM systems pay $67 to $128 more per year, depending on the utility, due to the costs of the NEM 1.0 and NEM 2.0 programs.[5] The Public Advocates Office at the CPUC estimates that non-low-income households without NEM systems pay $100 to $234 more per year, depending on utility. Without NEM reform, these amounts will increase substantially by 2030.
This is why a 2 for 1 buyback program on NEM-3.0 should be implemented so that for every two-Kilowatt Hours put on the grid by solar panel owners, they get one back as a credit. The Utilities have limited the number of solar watts allowed on homes but allowing homeowners to install more of them would give back to the utility more profits to cover costs in a 2 for 1 program. Batteries cost more than the solar panels to install and maintain than just installing more panels to cover the utility distribution and transmission costs. NEM-2.0 was counterproductive for both the environment and the utility because more solar could have been installed, on a home, than utilities allow. My home could have had 13,000 watts of Tesla Solar Glass Roof power installed but the limits placed by PG&E kept me down to 8,000 watts because of their 115% of previous years usage limit.
Batteries are a terrible waste of money if your goal is to play arbitrage. You have to think more than one step ahead. NEM 3.0 may temporarily incentivize using batteries but we’re not too far away from restructuring electricity rates such that we see higher fixed fees and much lower volumetric fees. These types of advance rates would tend to put home batteries well out of the money.
Lee Kasten said, “Batteries are a terrible waste of money if your goal is to play arbitrage.” and he is correct. Before I had my Tesla Solar Glass Roof installed with 2 grid tied inverters, I built an off-grid system with 80- 12-volt deep cycle 100-amp hour Marine/RV batteries. The lead acid batteries need to be changed out every 6 years or so. I pay $1,200.00 per year for replacement batteries and my solar system that uses the batteries produces 7,200 kilo watt hours per year. $1,200.00 / 7,200 = 16.66 cents per kilowatt hour additional to the cost of the original solar panel system that prorated at 10 cents per kilo watt hour for generation after the federal solar tax credit. That means the resultant cost for the energy I produce is 26.66 cents per kilo watt hour off-grid. I was in the 36-cent tier-4 and 48-cent tier-5 kilo watt hour tariffs before I added the off-grid system. The lead acid system would be equivalent to 3 Tesla Power Walls that need to be replaced every 12 years and cost $21,000.00 to make the change out replacement or pro-rated $1,750.00 per year additional for lithium batteries. Also, you do NOT get the Federal tax credits for the replacement batteries.
The 48-cent tier 5 tariff no longer exists but the new tier 3, 39 cents tariff, is almost as high. Today, a grid tied solar panel system pro-rates at only 11 cents per kilo watt hour when you use the grid as your long-term storage. 11 cents if far cheaper than the off-grid 26.66 cent off grid power. If a utility gave you 11 cents per kilo watt hour for your extra power you put onto the grid and you purchased, it back for 26 cents per kilo watt hour, it would cost the same as an off-grid system with batteries. With No additional monthly fees and allowing the homeowner to produce up to 200% of the previous year’s usage before the solar installation, the system would be at the break-even point for deciding whether to be grid tied or going totally off grid with a solar roof or solar panel system with batteries.
I still have both systems, running on my home, totaling 16,000 watts of solar and this past year I also replaced $500.00 of Natural Gas by shutting down my Gas Furnace and running all electric heaters in every room with my excess solar power credits built up over last summer with the 4-cent true-up power credit the utility would have given me for the excess 3,000 kilo watt hours electrical power, that they would have paid me $120.00 for at true-up. $500.00 – $120.00 = $380.00 gain over using excess electrical solar power over buying natural gas from PG&E. NEM-2.0 allowed this. As it was written NEM-3.0 would not have let me cut the natural gas usage if I was a new customer under NEM-3.0.