Desperate California Utilities Win Effort To Squeeze Money Out Of Solar Customers

Desperate California Utilities Win Effort to Squeeze Money Out of Solar Customers

Outfitting your roof with solar panels can be a great way to save energy and money. Right? Well, you won't save as much money in California, where new rules will force rooftop panel owners to shell over some extra money to their local energy provider — even if they don't need them at all.

In a vote in California today, the California Public Utilities Commission voted to bump fees up for folks who've got solar panels installed on their roofs. With the new decision, new solar customers will pay a one-time "reasonable interconnection fee" to get them on the grid, which could cost anywhere from $US75 ($106) to $US150 ($211). Then rooftop solar owners must also shell out around $US6 ($8) a month to account for any electricity they use from the utility companies, regardless of how much solar power their own private panels churn out.

Going into the vote, it was being described as a "potentially historic moment" for the solar energy industry, but it looks like the scales tipped more in favour of the utility companies. (There was a last-minute footnote that was deleted, though, which could have resulted in panel owners paying an extra $US18 ($25) per month, so the decision could be viewed as something of a compromise.)

Utility company Southern California Edison estimates the typical solar customer currently pays $US82 ($116) a month, and now they will pay $US91 ($128). If the utilities had fully succeeded in the vote, that rate would have gone as high as $US103 ($145).

It wasn't a total loss for opponents of the new ruling, though. Net metering was left intact — that's when solar panel owners are compensated for the electricity they produce from their panels that's in excess of what they use from the power company every month.

While no one is arguing that they're against the idea of solar energy, the debate stems from — what else? — money. The utilities companies argue that those customers without solar panels may end up paying less than those who do have them, so they will lose revenue. That's also why the amount of money customers can make back through net metering is capped.

California's not alone in this dilemma. Earlier today, Bloomberg Business reported that Nevada faces similar struggles between solar owners and utility companies. Nevada, like California and around 40 other states, all participate in net metering. And like in California, Nevada utility companies aren't happy about it. In fact, Nevada's largest utility, NV Energy, is fighting net metering tooth and nail.

While everyone wants to save the environment, all the laws and money swirling around green technologies that end up atop people's houses create a complicated future for citizens looking toward renewable energy to save a buck.

[Los Angeles Times]

Photo by Justin Sullivan/Getty Images


Comments

    What the hell? So basically "I don't care that you are actually not going to consume my service, you'll have to pay me because I don't want to lose my revenue". Are we moving from paying currency in exchange for products or service to paying currency just because companies said so and have the clout to make the government back them?

      Um solar users still consume the services of power companies. There's this little thing called the grid. Maybe you've heard of it.

    This is politics gone rogue. If they are afraid that they wont get any money from people, than maybe jump on the band wagon and change your business practices.

    Here's an idea, nip the the problem in the bud. How about these electric companies look into installing their OWN solar panels on peoples roofs. They could come up with some kind of lower paying compensation bracket for this, but in the end the amount of electricity they would gain in return for having so many panels would allow them to sell electricity on a broader market. E.g. up north to Washington and Oregon where they get less sun.

    So, you reduce your CO2 footprint AND you make money. Plus you don't have to gouge people who already saw the future coming and were able to afford the switch...

      "In embryo" I have to say that idea is cool. There would need to be a lot of cost analysis ect, lifespans models of panels, durability defects etc but it essentially does move a large portion of power generation away from CO2. Its a quick gain and thats what we need right now. Look at Walmart, they (their bean counters) became well aware of the cost benefits for the "long term".

    Fu#k it, if this shit comes here, I'm going off grid altogether and they can jam their bullshit gouging.

    great way to encourage people to go off grid and get on the battery bandwagon....

    Greed is the root of all evil and America seems to have a severe problem with it.

    Interesting that these kinds of articles never mention what would happen to poor people when the power companies can no longer afford to maintain the grid...

    And hell! If you can afford solar panels, you can afford a few extra bucks a month. After all, what's more important? Saving the environment or saving a few dollars a month?

      What is the point of haveing solar panels if you have to pay to use them?

      God I hate this argument. It's the "go-to" for any time there's any kind of extra tax on higher income earners "what about the poor people!?"

      Look, I am all for charity, and I completely agree that the electrical companies charging more would harm the people who have the least amount of money. However, the problem with this argument is that A) you assume the people who have the solar panels are apparently rolling in money, B) you assume that "x" company would HAVE to raise their prices.

      Here's a counter argument to both:
      A. Those people who did "x" did so by saving up or getting a loan and are now hoping that their investment will pay off in the long run. They aren't necessarily "rich."

      B. Company "x" could diversify, invest in new technologies, or any number of cost savings/adding measures in order to keep from raising their prices.

      Finally, I would like to address your "Saving the environment or saving a few dollars a month?"

      Most people, it's saving the money, because guess what, those panels cost a LOT. The environment was likely ONE of the many reasons a person chose to go solar, not the ONLY reason.

      So no, government really shouldn't be getting involved in these matters, it reeks of corporate investment in government policies and is just one long slippery slope.

        A) you assume the people who have the solar panels are apparently rolling in money,

        No, you're the one who introduced the concept of this being another tax on high income earners. I'm merely saying what happens when a majority of people remove themselves from the grid and it falls apart?

        B. Company "x" could diversify, invest in new technologies, or any number of cost savings/adding measures in order to keep from raising their prices.

        As opposed to ensuring users (solar owners) of their product (the energy grid) contribute to the cost of providing the service? I mean, after all, solar panel owners stand to benefit (profit, as you say) from the grid's existence. It seems only fair they should contribute to it's upkeep, like company "x"... who you say should diversify. It's kind of like how all road vehicle drivers contribute to the cost of the roads the drive on.

        How exactly do you make a power grid more diverse anyway? The way you talk it must be really simple.

        Most people, it's saving the money, because guess what, those panels cost a LOT. The environment was likely ONE of the many reasons a person chose to go solar, not the ONLY reason.

        If people buy an incredibly expensive thing in the name of saving money, then they're incredibly stupid. If you don't care about the environment, don't buy solar. There are cheaper ways to get your energy.

        Last edited 02/02/16 12:25 pm

          Jaded, you state:
          Interesting that these kinds of articles never mention what would happen to poor people when the power companies can no longer afford to maintain the grid...

          This has a two part implication:
          1. The people this affects the most is "Poor" people.
          2. People who are not "Poor" have less say in what is to occur in a situation.

          Your next statement:
          And hell! If you can afford solar panels, you can afford a few extra bucks a month.
          Counters your statement:
          No, you're the one who introduced the concept of this being another tax on high income earners.
          And justifies my saying:
          A) you assume the people who have the solar panels are apparently rolling in money

          Next, you try to counter my argument about companies diversifying/investing/cost saving by stating:
          As opposed to ensuring users (solar owners) of their product (the energy grid) contribute to the cost of providing the service?
          If you are a solar owner, than you are by reason, already a contributor to the energy grid as you would have a net zero or lower balance to the grid as a whole. E.g. feeding energy back into the grid. I grant, not all solar systems are setup this way, but a large majority are moving towards this goal.

          As for what an energy grid could do to diversify:
          Here's an idea, nip the the problem in the bud. How about these electric companies look into installing their OWN solar panels on peoples roofs. They could come up with some kind of lower paying compensation bracket for this, but in the end the amount of electricity they would gain in return for having so many panels would allow them to sell electricity on a broader market. E.g. up north to Washington and Oregon where they get less sun. (yes I posted that in an early entry, check it out).

          Finally:
          If people buy an incredibly expensive thing in the name of saving money, then they're incredibly stupid.
          I am so happy to see that anyone who tries to invest in the future is "stupid." Lets all forget about doing anything that requires a long term expensive investment. Ever heard of the term "You have to spend money to make money" - Titus Maccius Plautus

      US: privatise the profits and socialise the loses.

    There was a last-minute footnote that was deleted, though, which could have resulted in panel owners paying an extra $US18 ($25) per month, so the decision could be viewed as something of a compromise.

    That is until the CEO of XYZ utility company in California can't replace his 12 month old Ferrari and lobbies the yes men (err Government) for this additional concession.

    This WILL happen in Australia too.

    a few things stick out in this article.
    The first is that they pay ~$350 per quarter WITH solar panels.
    This seems high, but I don't have solar panels so I don't know what people pay here....but it does seem high.
    the second is that $350 would already have a 'payment to maintain the grid' portion of that amount.
    So now because one has solar, the expectation is that 'payment to maintain the grid' portion should be higher? I would have thought that they would have helped lower maintenance costs (maintaining a transmission wire would be cheaper than maintaining a generator that doesn't have to supply as much power to the solar enabled house).
    So this feels purely like stemming the erosion of profits from energy provided, not infrastructure maintained (which everyone pays I assume in an equal portion amount regardless of solar generation or not).
    Scary thing is that this is now a precedent.

    Last edited 01/02/16 2:52 pm

      Not really a precedent. In Australia I am sure you have to pay for severage if it runs past your house, even if you are not connected. Most have to pay a flat fee for rubbish collection services, even if they do not fill up their bin.
      This idea was floated in WA in recent months; the network has to cover the spikes in demand e.g. early evening on a hot day when evenyone comes home and switches on their airconditioner; the solar users are still deflecting that problem to the network.
      I know that the networks actually have financial arrangements with large industry, in which the industry/factory closes down for a couple of hours when peak demand is expected. It's about managing the peak demand. What the network needs to do is work more collaboratively with solar panel users; they are a real issue - what happens when the system is switched on after a power failure; suddenly all these panels are pumping power back into the grid? Takes some delicate management.

        Actually I don't think that applies to electricity here in Oz, but it definitely applies to water/sewerage.

      Except they still have to maintain a generator. It's not like someone going solar means they don't use any mains power. You're not generating your own electricity at night when most peak demands are.

      Playing devil's advocate for a second, they do connect the solar cells back to the grid so maybe there are additional costs compared to the "standard" power connection that non-solar people get. That said, I don't believe that's what the cost is. I believe it's more likely a "because we can" cost they're applying to make up shortfall in consumer profits.

      Just another good reason to look at how many Powerwall's you need to completely go off-grid.

        Also playing devils advocate, the cost of the grid does not change if solar is on the roof or not. I am not sure if the US has an access charge but here in Australia the access charge does not cover the cost of maintaining the grid.

        Some of the network charges are disguised in the rate. As a solar house uses less electricity in total it does not cover the cost of connection. The solution is to raise the access charge (selectively in this case to not impact those without solar). The KWh rate is high to discourage usage, which has worked over the last decade to lower usage/emissions and only now seeing demand rise again in the past year.

    Is the guy in the photo paid to stand on the roof and turn around so the panel is always facing the sun?

    Two words: Buggy whips!

    The outraged people in the threads above are boggling.

    Not one single person who wants to be connected to the grid wants the grid to fail due to lack of maintenance. $8 a month is a trivial cost to achieve this.

    Not one single person who wants to be connected to the grid should expect that connection to be installed for free. $75 to $150 is a trivial cost to achieve this life-threatening task.

    The original pricing system was optimized for connectees who draw significant current. It's utterly unsurprising that that costing system was illogical and uneconomic when applied to connectees who either draw minimal current, or supply it.

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