I believe I am living in my last house and the system will still be producing power longer than the duration of any of the leases, also.

I think the landscape has changed somewhat since 2010 though. One year ago, I expanded my system when I got an electric vehicle, and still chose to buy. I added more Enphase micro-inverters, and 12 chinese-made Talesun panels. Of course I charge my EV at night, and that’s a big chunk of my electricity usage right there.

I think the deals on solar are already pretty good, especially because of PG&E’s high rates. If their rates weren’t so high to begin with, solar wouldn’t be as cost effective – it isn’t as competitive in many other states with less sunshine, and less expensive power sourced from dirtier sources.

Ultimately, two things can happen. The major utilities can lower their prices which will reduce the uptake of solar.

Or they can keep increasing their prices more and more, until almost everyone has a solar system on their roof.

At that point they will mainly be charging for distribution, and will do a lot less generation than they do now, at least on most days.

btw, you own your system, right? any interest in providing a guest post on why you chose to buy rather than lease?

Quote :

“How will my net surplus compensation (NSC) rate be determined at the time of my true-up ”
The Net Surplus Compensation rate may fluctuate monthly, as it is based
on a rolling 12-month average of spot market prices. Your Net Surplus
Compensation rate is determined by using the average day-ahead spot
market prices (between 7 am and 5 pm) of procuring electricity for the
previous 12 months from the time of your true-up. For example, if your
true-up is in the month of October, prices from September of the
previous year to the September of the current year will be used to
calculate the rate that will then be applied for customers truing-up in
the month of October. Given fluctuations in energy costs over time, your
Net Surplus Compensation rate will also vary from year to year,
possibly rising or falling along with market costs of energy. Based on
current market prices, the rate would be approximately 4 cents per kWh.

Looks like actual wholesale prices are closer to 5-7 cents/kWh depending on day of the year :
http://www.eia.gov/electricity/wholesale/

Very interesting to see a spike to 12 cents/kWh around 9/11 . Seems like there is some market manipulation going on.

Either way, those rates aren’t anywhere close to the retail rates.

The utilities can’t have their cake and eat it it too. If I put power into the grid during the day that I don’t use, they charge my neighbors that do use it for that power at the retail rates. It’s fair enough that they credit me at the retail rate, too.

For surplus energy, crediting at wholesale rate is a little more justifiable. Most solar residential users don’t oversize their systems, though. They produce less kWh than they consume on an annual basis.

For the last 11 months so far (calendar 2013) my system produced 15165 kWh . And I also pulled a net 1365 kWh from the grid. This means my solar system is providing 91% of my power

As of my last bill I had a $203 net metering credit on my E-6 (TOU) bill.

If I was using E1 rate (non-TOU) I would have a positive $261 bill.

If I didn’t have solar, and was on E1 (non-TOU), the electric bill would have been $4830 for the last 11 months. So my solar system is reducing my electric bill by 104% .

Of course, at the end of the year, any excess NEMS credit gets zeroed, and I don’t have surplus energy, so there is no net surplus compensation.

The credit will probably shrink to near anyway by December 31, depending on my usage this month and how much rain we get.

2 years ago, that sounded logical to me. nowadays, i think solar power producers should be paid for the *value* of the electricity they produce, which i think is actually generally above the retail rate of electricity. http://cleantechnica.com/2013/02/21/the-value-of-solar-could-be-worth-much-more-than-austin-energy-pays/

but, in any case, now that you’ve explained all this, i’m curious about the wholesale rate. the wholesale rate of electricity in the middle of the day is only 3 cents/kWh there? that’s surprising.

PG&E charges its residential customers in excess of 50 cents/kWh in some rate schedules, like TOU summer peak.

Even
their so-called “aggregate rate” is about 17 cents per kWh for all
their residential customers, on average, regardless of season, TOU
period, and tier.

The wholesale rate is on the order of 3 cents/kWh.

I am not home during the day, and most of my electricity usage is outside sunshine hours.

With Bob’s proposal, most of my solar generation would be paid at the ridiculous “wholesale rate” of 3 cents per kWh.

And
most of my consumption would be billed at the nightly rate, which would
still be far higher. While I wouldn’t ever pay the highest TOU rates as
those are daytime, I could still hit high tiers in the nighttime. Note
that you always hit the same tier for each TOU period in PG&E’s
awfully complicated calculations.

Let’s say you consume 10000 kWh
a year, all at night, and produce 10000 kWh a year from your solar
system, all during the day. Ie. your net usage is zero.

10000 kWh during the day gets credited at 3 cents/kWh.

Net annual credit : $300.

10000 kWh consumed at night gets billed at PG&E’s average retail rate of 17 cents/kWh.

That’s a $1700 bill .

Net bill : $1700 – $300 = $1400 .

So, now, even though you are actually using any net energy from the utility, you still have a $1400 utility bill, 83% of the bill you had before putting in solar. The annual bill was reduced only by 300/1700 = 17%.

Now, you are producing 100% of the energy you need, just at different times.

But you still pay 83% of the cost as if you weren’t producing anything.

Sound fair to you ? Don’t you see a problem ?

If the CPUC and PG&E implement this, 2 things can happen :

1) those that don’t have solar yet will not make the investment for a mere 17% bill reduction.
This is surely what the utility want.

2) those that already have solar power will be looking at
disconnecting from the main grid completely, removing power from the utility at peak times.

Wasteful batteries that should never be necessary in the first place will be bought.

Neighborhoods will also setup their own private grids to be free of the nonsense of the big utilities.

PG&E charges its residential customers in excess of 50 cents/kWh in some rate schedules, like TOU summer peak.

Even their so-called “aggregate rate” is about 17 cents per kWh for all their residential customers, on average, regardless of season, TOU period, and tier.

The wholesale rate is on the order of 3 cents/kWh.

I am not home during the day, and most of my electricity usage is outside sunshine hours.

With Bob’s proposal, most of my solar generation would be paid at the ridiculous “wholesale rate” of 3 cents per kWh.

And most of my consumption would be billed at the nightly rate, which would still be far higher. While I wouldn’t ever pay the highest TOU rates as those are daytime, I could still hit high tiers in the nighttime. Note that you always hit the same tier for each TOU period in PG&E’s awfully complicated calculations.

Let’s say you consume 10000 kWh a year, all at night, and produce 10000 kWh a year from your solar system, all during the day. Ie. your net usage is zero.

10000 kWh during the day gets credited at 3 cents/kWh.

Net annual credit : $300.

10000 kWh consumed at night gets billed at PG&E’s average retail rate of 17 cents/kWh.

That’s a $1700 bill .

Net bill : $1700 – $400 = $300 .

So, now, even though you are actually using any net energy from the utility, you have a $1400 utility bill.

The annual bill was reduced only by 300/1700 = 17%.

Now, you are producing 100% of the energy you need, just at different times. But you still pay 82% of the cost as if you weren’t producing anything.

Sound fair to you ? Don’t you see a problem ?

If the CPUC and PG&E implement this, 2 things can happen :

1) those that don’t have solar yet will not make the investment for a mere 17% bill reduction.

2) those that already have solar power will be looking at
disconnecting from the main grid completely, removing power from the utility at peak times.
Wasteful batteries that should never be necessary in the first place will be bought.
Neighborhoods will also setup their own private grids to be free of the nonsense of the big utilities.

And don’t forget that when you get your solar system that you’ve locked in the price of ‘fuel’ for the life of the system. The price of gas will almost certainly keep rising, but the cost of charging will stay the same.
—

As far as PG&E paying you what they sell electricity to others, remember that they are furnishing the transmission and backup. IMO they should be paying you the wholesale rate for the hours when you are supplying them electricity. Then charging you retail when you take back.

You would still get to avoid the highest TOU or top tier rate and buy at the lowest retail price point while also saving a tremendous amount on ‘fuel’.

Win-win as I see it.

Put it this way, as soon as I get an electric vehicle and start charging it with the solar panels on my roof is the day I start saving $210 per month in petrol/gasoline ($2520 year).

Let’s say that the cost of my solar panel system installed is $18,000 and lasts about 30 years (or until the panels only output about 60% of what they did new), then I’m only really paying about $50 a month for my Solar Panel system ($600 year), and nothing to charge up my EV. EV’s don’t need to be smog checked, there’s no transmission, no oil changes, no waiting in line at the gas station because you can charge at home (in my scenario). There might be a coolant change, tires get worn down, wiper fluid runs out too.

It all starts to make sense when you realize that most people in the US don’t drive more than 100 miles a day commuting (which is where most people burn away their money). So those solar panels might start to make sense financially in the long run, whether or not PG&E try’s to advance another unfriendly policy change. I think PG&E should pay me for producing electricity what they charge others to consume, not less. It would be fair. Right now the policy seems unfair.