let's talk about battery banks- I reckon the "they aren't worth it" thing is wrong

[K8MHZ]

Please see my post 378.

To be clear, there are no extra costs, just existing costs that have less profit to pay for them, correct?

 

[iwire]

To be clear, there is no extra costs, just existing costs that have less profit to pay them, correct?

That is really splitting hairs. There are costs for maintaining the system. If the income from that system drops the only option other than less profit* is to raise the rates.

That would be 'extra costs' to the customers.

My suggestion is simply put that extra cost onto the people that are causing it not everyone.


Am I crazy? I thought that would be commonsense but I seem to be in the minority here. :?






*No business is going to opt for less profits.

 

[K8MHZ]

Also, Iwire, in your analogy you left out the part that we pay the POCO a fixed fee every month, even with zero use. So, if profits from use fell to zero, the collection of the monthly 'connect' fee would be free money for the POCO.

 

[K8MHZ]

That is really splitting hairs. There are costs for maintaining the system. If the income from that system drops the only option other than less profit* is to raise the rates.

That would be 'extra costs' to the customers.

My suggestion is simply put that extra cost onto the people that are causing it not everyone.


Am I crazy? I thought that would be commonsense but I seem to be in the minority here. :?






*No business is going to opt for less profits.

Here, the POCO's profits are governed by our PSC. The POCO really has no say over what their profits will be.

Also, the percentage of net metered energy going back to the grid is very, very low. In Michigan it's almost not countable.

 

[iwire]

Also, Iwire, in your analogy you left out the part that we pay the POCO a fixed fee every month, even with zero use.

I did not leave that out, if you look I said a Kwh charge of $0.00 not a bill of $0.00

But its really irrelevant, the bottom line is the same amount of infrastructure must be maintained with less money coming in.

What is the justification of forcing non-solar uses to pay added costs to maintain the infrastructure for solar users?


I agree with Solar-Pro, changes are coming and all these details need to be worked out.

I think free net metering made sense to get things rolling but at this point PV is pretty well established and their needs to be re-evaluation of the policies.

 

[SolarPro]

I am just asking a simple question about the justification of non-solar users subsidizing solar users even though those subsidies have helped put money in my bank.

Agreed. The policies that helped the industry get off the ground aren't the policies that will be needed as the industry comes to scale. Ideally, regulators will wipe the slate clean, figure out what the future will look like, and write new rules accordingly. The challenge, as I see it, is that we're talking about pretty disruptive changes and there's just a lot of systemic inertia. So we're left trying to fit square pegs into round holes.

As an example, let's assume for a moment that in a high-penetration scenario utilities need to charge solar customers for their utility connection. Rather than creating different classes of customers (w/ solar & w/out solar), it seems like utilities should have a fixed service charge for all customer, rather than baking that cost into the kWh price. Then everyone is on a level playing field at least. Unfortunately, I don't really think this solves anything in the big picture.

I suspect that the role of incumbent utilities is going to change in fundamental ways, and that their profits need to be decoupled from energy sales. Regulators need to create compensatory mechanisms that ensure a certain rate of return, based on the fact that these entities provide an essential service. Under a scenario like this, you should be able to have market mechanisms for power generation and ancillary services that accommodate a wide variety of assets, including DG.

Here's my problem with some of the Koch brothers-funded anti-renewables campaign. Yes, they point out some legitimate concerns. However, these concerns aren't a real problem for utilities (the "death spiral") except in high-penetration scenarios. Outside of Hawaii, solar is still a fraction of 1% of the power generation capacity in most markets. Instead of everyone working together to create policies that make sense for the 21st century smart grid, we're seeing reactionary and draconian proposals for dealing with solar in places where the social costs are pennies per consumer, as ggunn pints out. It's a Quixotic fight, as renewable poll very highly with consumers.

Yes, we need new regulations. But the sky is not falling for utilities. And renewables and storage are not the enemy.

 

[ggunn]

The same thing is happening in reduced scale with some of the customers on net metering. The utility is getting less $ to maintain the infrastructure that is being used as free storage to those folks.

But the utility is also spending less money to buy electricity from the spot market during the times when locally generated solar is feeding the grid.

Well I entirely disagree with that view point so we will have to agree to disagree on that.

OK, but that opens a huge philosophical can of worms. Some in the US using the same sort of reasoning object on principle to the fact that their tax dollars are going to subsidize Halliburton and General Dynamics in order to pursue goals with which they do not agree.

Here in Austin, every rate payer gets charged equally for the electrical energy they use wherever it comes from, be it from the grid or from a PV system on their roof. In a separate transaction, AE buys all the energy a PV system owner produces at an agreed upon Value Of Solar, whether it goes into the grid or is used on the premises. It's not net metering; net metering is going away pretty much everywhere. It's not subsidization, either; Austin Energy is purchasing energy from their customers with PV on their roofs, the same as they purchase energy from any other source.

AE gets energy much cheaper from local distributed generation sources during peak periods during the summer than it would by shopping for it on the spot market, both from buying it from PV system owners and cashing in on the avoided need for power during those times because some folks are fulfilling a portion of their own needs, and the rate payers share in those savings. It is a net positive for them and their rate payers, and I have seen the numbers.

Your question is not a simple one, and it is a "have you quit beating your wife" type inquiry, where in order to answer the question one must accept the embedded premise, which I do not. It's not that I ignore the fact that non solar customers are subsidizing solar customers, it's that I do not agree that it is a fact. And yes, I am unabashedly an honestly admitted proponent of solar, and I have been for more than 50 years, and it isn't because I make my living in solar (although I do). My advocacy of solar came first by several decades.

 

[wwhitney]

I did not leave that out, if you look I said a Kwh charge of $0.00 not a bill of $0.00
But its really irrelevant, the bottom line is the same amount of infrastructure must be maintained with less money coming in.
What is the justification of forcing non-solar uses to pay added costs to maintain the infrastructure for solar users?

In a rational tariff system, the fixed fee would pay for the utility's fixed costs, and the per kWh fee would pay for their usage-dependent costs. In such a system, the non-solar customers aren't subsidizing the solar customers, the costs to maintain the infrastructure for solar users are reflected in the fixed fee.

So for utilities that do charge a fixed fee, what evidence do you have that the fixed fee is too low, and that the per kWh fee is actually paying for some of the fixed costs?

Cheers, Wayne

 

[iwire]

But the sky is not falling for utilities. And renewables and storage are not the enemy.

But I never said the sky was falling.

I am punching out of this one, its like trying to talk politics or religion. Every person that posts has their own agenda and straw man arguments making it impossible (for me anyway) to rationally discuss this.

 

[SolarPro]

But I never said the sky was falling.

I wasn't suggesting that you do, but rather acknowledging that there are organizations fighting DG who do have this perspective.

Take this Edison Electric Institute report, for example:

The financial risks created by disruptive challenges include declining utility revenues, increasing costs, and lower profitability potential, particularly over the long-term. As DER and DSM programs continue to capture “market share,” for example, utility revenues will be reduced. Adding the higher costs to integrate DER, increasing subsidies for DSM and direct metering of DER will result in the potential for a squeeze on profitability and, thus, credit metrics. While the regulatory process is expected to allow for recovery of lost revenues in future rate cases, tariff structures in most states call for non-DER customers to pay for (or absorb) lost revenues. As DER penetration increases, this is a cost-recovery structure that will lead to political pressure to undo these cross subsidies and may result in utility stranded cost exposure.

DER is not the only disruptive risk the industry faces. Energy efficiency and DSM programs that promote lower electricity sales pressure earnings required to support capital investment. Without a tariff structure that properly allocates fixed vs. variable costs, any structure for lost revenues would come at a cost to nonparticipating customers, who will then be more motivated to find alternatives to reduce their consumption. While it is not the objective of this paper to outline new business model alternatives to address disruptive challenges, there are a number of actions that utilities and stakeholders should consider on a timely basis to align the interests of all stakeholders, while avoiding additional subsidies for non-participating customer.

Immediate Actions:
§ Institute a monthly customer service charge to all tariffs in all states in order to recover fixed costs and eliminate the cross-subsidy biases that are created by distributed resources and net metering, energy efficiency, and demand-side resources;
§ Develop a tariff structure to reflect the cost of service and value provided to DER customers, being off-peak service, back-up interruptible service, and the pathway to sell DER resources to the utility or other energy supply providers; and
§ Analyze revision of net metering programs in all states so that self-generated DER sales to utilities are treated as supply-side purchases at a market-derived price. From a load provider’s perspective, this would support the adoption of distributed resources on economically driven bases, as opposed to being incentivized by cross subsidies.

Sound familiar?

 

[jaggedben]

That is pretty much what is happening now.

For the sake of argument lets say 100% of the customers where on net metering producing what they each need for electricity. They ship it to the utility during the day and they take it back at night resulting in a Kwh charge from the utility of $0.00.

Under those circumstances where does the utility get the money to maintain their infrastructure?

You can easily see that these two quotes don't jive because we are nowhere anywhere near having 100% of customers on net-metering, so that isn't "happening now." Remember that any energy that a DG customer sells to the grid is sold to their neighbors for, on average, the same price. So the grid provider deserves no markup on energy didn't supply.

What is the justification of forcing non-solar uses to pay added costs to maintain the infrastructure for solar users?

There are no added costs. The costs are the same. Your complaint is that solar users are no longer paying for their share, which is valid to a point. My view is simply that if you re-engineer the rate structure so that the costs of maintaining grid infrastructure are itemized separately from the costs of supply energy, then do that for everyone, not just solar customers. In other words...

In a rational tariff system, the fixed fee would pay for the utility's fixed costs, and the per kWh fee would pay for their usage-dependent costs. In such a system, the non-solar customers aren't subsidizing the solar customers, the costs to maintain the infrastructure for solar users are reflected in the fixed fee.

...what he said.

(Demand could be incorporated, too. What's the difference between a solar customer whose grid usage spikes up and down because of clouds, and a non-solar user who's using a welder? You can apply the same rate policies to both.)

 

[ggunn]

There are no added costs. The costs are the same. Your complaint is that solar users are no longer paying for their share, which is valid to a point. My view is simply that if you re-engineer the rate structure so that the costs of maintaining grid infrastructure are itemized separately from the costs of supply energy, then do that for everyone, not just solar customers. In other words...

...do as Austin Energy does. Solar producers and non solar owners get charged according to the same rate structure for their usage no matter where the energy comes from and solar producers get credited separately for their production at a flat rate no matter where it goes. That keeps the value of solar disconnected from the amount of energy someone uses. In net metering with a tiered rate structure, solar is worth more to someone who uses a lot of energy than to someone whose usage is lower.

 

[jaggedben]

...do as Austin Energy does. Solar producers and non solar owners get charged according to the same rate structure for their usage no matter where the energy comes from and solar producers get credited separately for their production at a flat rate no matter where it goes. That keeps the value of solar disconnected from the amount of energy someone uses. In net metering with a tiered rate structure, solar is worth more to someone who uses a lot of energy than to someone whose usage is lower.

Does Austin energy adjust the 'value of solar' amount up and down? As more and more people install solar, doesn't the value go down? What are the long term implications for the take up of solar and storage?

It's certainly an interesting approach, although not exactly addressing the same issue as what I was getting at above, and still doesn't address the demand and storage issues. Also, theoretically tiered rates exist to account for the more costly peak generation that the utility has to provide for that higher consumption. So if those higher costs are offset by solar, it makes some kind of sense that the higher tiers also be offset.

 

[ggunn]

Does Austin energy adjust the 'value of solar' amount up and down? As more and more people install solar, doesn't the value go down? What are the long term implications for the take up of solar and storage?

It's certainly an interesting approach, although not exactly addressing the same issue as what I was getting at above, and still doesn't address the demand and storage issues. Also, theoretically tiered rates exist to account for the more costly peak generation that the utility has to provide for that higher consumption. So if those higher costs are offset by solar, it makes some kind of sense that the higher tiers also be offset.

The Value Of Solar is adjusted yearly. Austin Energy has tiered tariffs according to monthly usage amount but it doesn't have Time Of Use billing or demand charges for residences so storage doesn't buy you anything. Energy you use costs you the same whether or not you have solar and whether the energy comes from your PV or from the grid. Credit for PV production at the VOS is a separate transaction and is paid for the total kWh produced whether you use it yourself or export it.

Credits roll over month to month but they won't cut you a check. Since Austin Energy is a municipally owned utility, the credits are applied to your total city bill - electricity, water, wastewater, and trash and recycling pickup.

 

[SolarPro]

Does Austin energy adjust the 'value of solar' amount up and down? As more and more people install solar, doesn't the value go down? What are the long term implications for the take up of solar and storage?

Yeah, that's my only concern with value of solar programs. Austin's number drives business at $0.113/kWh (for 2015). But when CPS ran the numbers just down the road in San Antonio, they came up with something like $0.06/kWh.

Ouch! That sucks for the guy who paid $20,000 for a 3kW system in 2008.

Out of curiosity, does anybody here know of any other power generation technologies besides solar where average customers are willing to pay the bulk of the installation costs out of pocket? I mean, if a utility put together a Kickstarter campaign for community solar, people would be knocking down the door to participate. Right? Think that would work for coal or nuclear? If the utility of the future is crowd funded, solar looks pretty good. (It sounds pretty crazy, but stranger things have happened.)

Here's another crazy idea that you never asked to hear: I'm willing to bet that before I die utilities start entering into partnerships with EV manufacturers, in part to build their load base but, more importantly, as a means of gaining access to a widely-distributed redundant network of dispatchable energy storage assets.

 

[Electric-Light]

LEED Mercury Award

 

[PVfarmer]

gg- how much is solar costing you? How much higher is your bill than it would be if there were no solar on the grid?

That is smoke and mirrors, and is not the point. The point is those costs to the utilities are real and they have to be recouped by passing the costs along to all customers.

Why should non-solar uses continue to subsidize solar users?

Not sure what it is elesewhere, but...point 31 cents? That's like a dollar a month or so- I'm not personally upset by that charge.
Renewable Energy Charge (0.031)¢ per kWh

EL- Whoever thought 91 cent customer charge is a good idea?It's costing everyone else money.

Who charges 91 cents for what, where?

(holy !@#$, this thread is that long?)...

Yep, it is somewhat remarkable!

SolarPro-
You know what is also happening now? Everyone in the country bears substantial costs associated with the fossil fuel industries: cleaning up superfund sites, dealing with air and water pollution and the health effects thereof, rebuilding infrastructure loss to global warming. Who pays for oils spills, coal ash spills, nuclear waste disposal?

:thumbsup: Very good point! :roll: ALL OF US DO!!

It's a brave new world. Get ready. It's coming.

:thumbsup::thumbsup:

K8-
What else could there be except for a loss of profit from sales?How much is that loss, actually? And isn't at least some of that offset by not having as much stress on the infrastructure for an increased overall demand?

Right, except let's not forget the POCO keeps the RECs in most cases- which I think pretty much balances out a lot of the "loss of profit".

That is really splitting hairs. There are costs for maintaining the system. If the income from that system drops the only option other than less profit* is to raise the rates.
That would be 'extra costs' to the customers.
My suggestion is simply put that extra cost onto the people that are causing it not everyone.

But how is that fair when someone has already coughed up a ton of $$ for PV?
Again, .03 cents- not a big deal here, but is that charge a lot higher somewhere else?

Solar Pro-
Out of curiosity, does anybody here know of any other power generation technologies besides solar where average customers are willing to pay the bulk of the installation costs out of pocket?

Not off hand, but I can think of one where they SHOULD- solar hot water for anyone with electric hot water!
Seems like the "powers that be" are trying to promote it, but nobody knows what it is or how (well) it works.
Evacuated vacuum tubes + Sterling engines- you get hot water AND electricity, and the electric output is like over 30% efficiency, compared to 18% for panels -> to electricity.
More energy output in less area = perfect for the suburbs?

 

[PVfarmer]

Right. Many solar advocates expect that new rate structures, like residential demand charges, are exactly what will make solar+storage mainstream. (You can't have a high penetration of variable renewable resources without storage.) Demand charges are already driving some strong commercial and industrial solar+storage markets. Plus, in the future, DG owners/operators (like SolarCity and SunEdison) will be able to manage their entire fleet of assets as requested by the independent system operator. So you effectively have the benefits of a large-scale generation resource, as well as the benefits of having power generation and ancillary service assets close to the load, where these can help utility operators the most.

It's going to be a long and bumpy road before we really have a 21st Century smart grid, but it's going to happen in our lifetime. The US DOE is behind it. PUCs see it as inevitable. There's just a lot of work to do on standards, control protocols, security, safety, etc..

Here's some interesting reading:

SANDIA Report on Advanced Microgrids

IREC report on Distributed Energy Storage

California PUC's Regulatory Report on Microgrids

Great links! Thanks.
Now you've got me going!! :happyyes:

Renewable Energy and Nanogrids(REN)
http://www.cpes.vt.edu/public_files/CPES_REN_Proposal_Aug2010.pdf
The future home dc nanogrid is envisioned to have two dc voltage levels: a high‐voltage (380 V)
dc bus powering HVAC, kitchen loads, and other major home appliances, and a multitude of
low‐voltage (48 V) dc buses powering small tabletop appliances, computer and entertainment
systems, and LED lighting. The 380 V dc level is chosen to match the industry‐standard
intermediate dc voltage in consumer electronics with the PFC circuit at the input, so that
conversion from ac to dc would involve only bypassing the front‐end rectifier. The 48 V dc level
is chosen to coincide with the standard telecom voltage to facilitate adoption, increase
efficiency, and provide enhanced safety when handling small appliances, while enabling
aesthetically attractive designs with exposed electrical‐structural elements. Similar 380 V / 48 V
dc power distribution systems are currently also being considered for datacom centers in Japan,
Europe, and USA, and are also being contemplated for PHEVs and aircraft power systems.
Several manufacturers already have on the market high power‐density bus control modules
(BCMs) that supply 48 V from 380 V and are intended for these applications.

In higher voltage dc systems, fault current interruption is of particular concern. However, in the
proposed nanogrid architecture all power is fed from electronic power converters that are
controllable and can provide active current limiting, thus reducing the need for
electromechanical protection devices. The system could be even completely breakerless if all
the source converter topologies comprise serial semiconductor switches which fail “open” in
the case of abnormal failure. This would also eliminate the need for significant over‐sizing of
the wiring and upstream converters that is traditionally used to ensure safe clearing of the
electromechanical breakers in the case of faults. Therefore, such nanogrids may be able to
provide increased energy efficiency, power density, and reliability, at possibly lower installation
and operation costs.

 

[Electric-Light]

Who charges 91 cents for what, where?

Southern California Edison's monthly fee is an absurdly low 91 cents per month, and a sky high per kWh rate and crazy rationing structure. (tier 1 from 0-AkWh, tier 2 from A-BkWh, tier 3 from B-C kWh..) Benefiting real estate investor absentee "homeowners", net metering and solar industry.

If the monthly meter fee was $10-12, but kWh rate was such that lower kWh pricing with median-average kWh usage would offset it, it does not hurt the people living there. It would be going against near zero users like vacant properties and high production net metering users who utilize grid for demand and night power w/o any payment.

 

[ggunn]

Southern California Edison's monthly fee is an absurdly low 91 cents per month, and a sky high per kWh rate and crazy rationing structure. (tier 1 from 0-AkWh, tier 2 from A-BkWh, tier 3 from B-C kWh..) Benefiting real estate investor absentee "homeowners", net metering and solar industry.

If the monthly meter fee was $10-12, but kWh rate was such that lower kWh pricing with median-average kWh usage would offset it, it does not hurt the people living there. It would be going against near zero users like vacant properties and high production net metering users who utilize grid for demand and night power w/o any payment.

Look at it this way: PV owners lend kWh's to the utility during the day when they are expensive on the spot market and call in the loan at night when the market is down. The utility benefits from this without paying for it. Perhaps the PV owners should charge interest on the loan.