Net Metering (California Style)

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Also I bet the load factor for solar+storage is much more like the the non solar customers. Might be even closer to 1. The joint utilities plan to tax solar owners by kW regardless of having storage is deeply, deeply flawed.
 
Hv&Lv said:
We are.
going to increase the basic facilities charge on solar installs and continue to pay avoided wholesale rate for exported power.
No net metering here…
😉
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So customers with low load factors who don't have solar are off the hook? How do you justify that?
 
This discussion reminds me of tax discussions. Who should pay and how much is "fair"?

Please don't let my comment derail the discussion and go into a different tangent. I just see it as a parallel in many ways. Some would say make it a flat rate across the board, some would say you need to provide exceptions. Next thing you know, we end up with a "energy rate code" similar to the "tax code" where there are loopholes, exceptions, etc and nobody is happy with it or understands it haha.
 
bwat said:
This discussion reminds me of tax discussions. Who should pay and how much is "fair"?

Please don't let my comment derail the discussion and go into a different tangent. I just see it as a parallel in many ways. Some would say make it a flat rate across the board, some would say you need to provide exceptions. Next thing you know, we end up with a "energy rate code" similar to the "tax code" where there are loopholes, exceptions, etc and nobody is happy with it or understands it haha.
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Agreed..
This is one of those “agree to disagree” discussions and end it with that.
Jaggedben and I are seeing this from two different perspectives where neither is completely wrong or right.
I look at his expertise regarding any solar with interest and am not going to screw that up with a back and forth that won’t matter in the end. We’re from opposite ends of the country…
😁
 
Hv&Lv said:
No, not what I’m saying at all, your twisting words…
energy sales pay a large part of facilities charges.
example. True facility charges per customer before energy charges should be around $60-70.
They aren’t, simply because the energy sales make up the difference.
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I think we are saying the same thing ... if the true facility charges is $60-70 then that should be the same fixed fee for everyone (solar or non-solar). The energy sales charge based on consumption is separate.
 
Perhaps it's a bit simplistic, but my starting point (before embellishments) for a "fair" rate structure would be that each user pays $A * (service size in kW) plus $B * (kWh used). The value of A chosen to cover all overhead costs (if no energy were used/transmitted) and the value of B chosen to cover the marginal costs per kWh delivered. I think that is how city water service is often billed, there's a meter fee that depends on the size of your water meter (and hence capacity of your water hookup) regardless of your usage.

Is there an argument that there should also be a fixed cost $C for all users? I.e. if you graph the overhead/equipment/hook up costs (no energy delivered) vs service size, is the y-intercept approximately $0?

Cheers, Wayne
 
wwhitney said:
Perhaps it's a bit simplistic, but my starting point (before embellishments) for a "fair" rate structure would be that each user pays $A * (service size in kW) plus $B * (kWh used). The value of A chosen to cover all overhead costs (if no energy were used/transmitted) and the value of B chosen to cover the marginal costs per kWh delivered. I think that is how city water service is often billed, there's a meter fee that depends on the size of your water meter (and hence capacity of your water hookup) regardless of your usage.

Is there an argument that there should also be a fixed cost $C for all users? I.e. if you graph the overhead/equipment/hook up costs (no energy delivered) vs service size, is the y-intercept approximately $0?

Cheers, Wayne
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WAY more convoluted than that…

U.S. Utility Rate Database

apps.openei.org apps.openei.org
 
Hv&Lv said:
WAY more convoluted than that…
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Certainly the current rates are way more convoluted than that, but I thought we were discussing a "fair" rebuild of the rate structure from scratch. So I don't see what you're trying to tell me?

Cheers, Wayne
 
wwhitney said:
Certainly the current rates are way more convoluted than that, but I thought we were discussing a "fair" rebuild of the rate structure from scratch. So I don't see what you're trying to tell me?

Cheers, Wayne
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I wasn’t aware the discussion had evolved to that, sorry.
Rate restructuring from scratch isn’t going to happen…
There are too many different types of services and circumstances
 
Hv&Lv said:
Rate restructuring from scratch isn’t going to happen…
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Agree a complete restructuring is a heavy lift.

But in considering what if any rate changes are required due to the disruption of increasing PV deployment, it's worth thinking about what the optimal/fair rate structure would be, and to choose a change that both addresses the disruption and moves the system closer to optimal/fair rather than farther from it.

Cheers, Wayne
 
Hv&Lv said:
True facility charges per customer before energy charges should be around $60-70.
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Is that all customers, or residential customers?

Not at all arguing, but a smaller efficient home with NG for heating/hot water/cooking but electric AC might use 1000 kWh/mo. Here in the Carolinas the energy cost is in the $0.12/kWh. So half the energy cost goes to facilities? I can see that. But wouldn't a 3x larger home with low efficiency using say 4000 kWh/mo have virtually the same facility cost? Thus, this supports a separate facility charge.

This is like taxes; figuring out HOW to apportion $ is harder than we'd like.
 
GeorgeB said:
Is that all customers, or residential customers?

Not at all arguing, but a smaller efficient home with NG for heating/hot water/cooking but electric AC might use 1000 kWh/mo. Here in the Carolinas the energy cost is in the $0.12/kWh. So half the energy cost goes to facilities? I can see that. But wouldn't a 3x larger home with low efficiency using say 4000 kWh/mo have virtually the same facility cost? Thus, this supports a separate facility charge.

This is like taxes; figuring out HOW to apportion $ is harder than we'd like.
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residential. Farm is a little higher, commercial even higher, then there is the three phase basic facility charge.
For a rural system with ~ 10-15 meters per mile it’s tough to keep enough money in the coffers for large events that FEMA doesn’t cover.
we simply can’t charge the true cost so we have to do it in sales. we have some farm customers that have a power bill less than $50 with the $32 basic facilities charge. Some have the facility charges alone. All they want is the convenience to turn a bulb on once in a while…
We have to charge a higher facilities charge there because there aren’t any sales. Fence chargers are notorious for not turning a single kWh in YEARS with the old mechanical meters.
 
mtnelect said:
Joint Utilities also support this finding, asserting the Lookback Study concludes that NEM 2.0 participating customers receive “significant financial benefits” at the “expense of non-participating customers.” Recognizing the Lookback Study cost shift estimate of $1 billion only looks at NEM 2.0 customers prior to 2020, Joint Utilities claim that, by looking at all customers who have adopted NEM 2.0 through 2020, NEM 2.0 installations will increase bills paid by non-participant customers by $13 billion over 20 years.41 Supporting this disparity, IEPA points to the Lookback Study finding that residential net energy metering customers’ bills are lower than the utility’s cost to serve them while nonparticipant ratepayers see increased rates.42
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California Public Utilities Commission Fact Sheet Modernizing California’s Net Energy Metering Program to Meet our Clean Energy Goals December 13, 2021
 

Attachments

  • Net Billing Tariff Fact Sheet.pdf
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Hv&Lv said:
We have to charge a higher facilities charge there because there aren’t any sales. Fence chargers are notorious for not turning a single kWh in YEARS with the old mechanical meters.
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This particular example speaks to why a billing scheme which has a more realistic facility charge and lower usage charges should apply to everyone.

If the facility charge was $100 and the consumption charge $0 (old analog meter), that load would almost certainly be better served with solar.

If the land owner wants the convenience of having utility power available even though they rarely use it? That is a valuable service which they should pay for.

Jon
 
The whole discussion of POCO loosing money on solar grid net metering to me seems to be just a gimmick to get rid of popularity or limit to only wealthy the use of solar, as pricing had been coming down making it available to more households. Here we've been paying a minimum "priviledge" fee just to be hooked to the grid not related to usage and it was not related to solar. This would be charged even if you had all breakers off and had no usage. That was said to be related to infrastructure maintenance and upgrades.

Now if the POCO had designed their fee structure that over relied on supply fees for profit margins they should straight forward admit that. But don't go saying solar use is impacting infrastructure maintenance directly.
Now they could go the route of Propane companies. Less use has a higher $/gal. Found this out when upgraded to more efficient appliances and ended up paying a higher bill, even though I used a lot less. And then there was the tank fee also.
 
We are all finding this out.

We are used to buying stuff 'by the unit' (by the kWh, or by the gallon, or by the trip). Buying stuff by the unit is so ingrained that it feels perfectly fair.

But there is huge value in the availability of the stuff we buy 'by the unit', even when we don't make the purchase. Having food on the shelf in the grocery store, or drugs on the shelf in the pharmacy, or gas in the tank at the station. We don't know how to pay for these things....but they must be paid for.

Jon
 
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