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Clean Power Why Is “Solar Power vs Utilities” Such A Hot Topic?

Published on July 10th, 2013 | by Zachary Shahan

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Why Is “Solar Power vs Utilities” Such A Hot Topic?

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July 10th, 2013 by Zachary Shahan 

Many of our most popular articles of the year concern the “fight” between solar power beneficiaries and utilities*. The distributed solar revolution is afoot, and talk of war, fighting, revolution, and the death of utilities is hot. Sometimes it seems to go a little further than is warranted, but I guess that’s how you get a revolution going, and it certainly seems to resonate well with readers.

I’ve just been wondering, why do such stories do so well? I thought I’d reflect on this a bit in public and also see what others think.

For one, I think there’s that whole “David vs Goliath” thing going on. Alongside that, there’s a similar “rich vs poor” or “rich vs middle class” or Robin Hood kind of story here. Utilities are rich semi-monopolies that have had a grip on our pocketbooks for ages. They also have a pretty huge influence over our policymakers. Electric utilities are the 13th biggest contributor to US Congress in terms of money donated. And they’re one of the least discriminatory — 40% goes to Democrats while 60% goes to Republicans. Anything that could dismantle the power of these megapowerful utilities is inherently a somewhat exciting topic.

Then there’s also the independence thing. Independence is a hot ideal within the US, and also in many other places. Solar power, clearly, gives us a bit more independence… or at least the ability to be independent. Furthermore, it gives us independence (or that potential for independence) from a somewhat faceless, vaguely known and understood, powerful body that we largely just see as taking our money.

A couple of lesser but still probably quite powerful concepts that I think make the solar vs utilities theme so popular are: 1) we are cutting pollution in favor of natural abundant, clean energy from the sun; and 2) this shift is part of another wave of technological transformation or revolution that gets some of us very excited. We read about the Industrial Revolution in our history books, but now we are in the midst of creating the Cleantech Revolution and the Distributed Energy Revolution. This is exciting stuff. We are creating history. And this time the result is a cut in pollution.

Those are my thoughts. What are yours?

*Other publications and writers are seeing the same trend. David Roberts of Grist had such a post go completely viral this year.

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About the Author

spends most of his time here on CleanTechnica as the director/chief editor. Otherwise, he's probably enthusiastically fulfilling his duties as the director/editor of Solar Love, EV Obsession, Planetsave, or Bikocity. Zach is recognized globally as a solar energy, electric car, and wind energy expert. If you would like him to speak at a related conference or event, connect with him via social media. You can connect with Zach on any popular social networking site you like. Links to all of his main social media profiles are on ZacharyShahan.com.



  • SolarGlen

    Utilities will spend their last monopoly dollar to kill distributed solar PV! The only solution is like Germany where the government forced the utilities to accept high penetration distributed solar PV. Politicians respond to voters or money (which they use to buy votes), so as in Germany, we voters must demand the government force the utilities to accept solar. That is the only solution.

    • Bob_Wallace

      Interestingly, the Tea Party in Georgia is pushing their state government to allow more solar on line.

  • Scott Schroeder

    The paragraph highlighted here is an excerpt from The CATO Journal (Vol.14 No.3, Competitive Markets for Electricity Generation, John C. Moorhouse) and it does not need improvement.

    Conclusion:

    The technical and economic knowledge exist to permit the substitution of market competition for state ownership or government regulation in the electricity generation industry. The chief advantages of making that substitution include a reduction of costs and lower final user prices, closer alignment between the array of services offered and consumer preferences, and greater incentives for ongoing discovery and innovation.

    • Bob_Wallace

      You are correct. It does not need improvement. It needs a quick trip to the trash can.
      If we leave the choice of electricity generation to market forces we will continue to burn coal and destroy our climate.

      The market will make its decision only on short term price, not the long term costs of rising seas and destruction of crop lands.

      The market is a great tool. But it has to be used wisely.

  • Rob Gallowy

    Remember the slogan of the 70′s? Power to the people! Now, finally, we really can have it. Nice to finally have the ability to get the utility/oil company hands out of our pockets.

  • Doug Elbinger

    Zach,

    The apparent dissonance between the solar energy movement and
    the near monopoly ‘power’ of the utilities and their lobbyist …is an
    impending socio-economic and political struggle that is inevitable. So it is
    important that you and other raise this issue to the forefront.

    If there is going to be a revolution of energy independence it will probably
    take place one rooftop at a time by the heroes of the revolution. The ability to create clean, abundant, sustainable energy is freedom. I agree. This is exciting stuff. We are creating history in the information age …of no less importance, than 100 years ago, when Henry Ford invented the assembly line and ignited the industrial revolution.

    • Zedicus

      The industrial revolution began in the late 1700s, long before the first Model T assembly line came online in 1913.

  • Bob_Wallace

    I’ve been off the grid for over 20 years. The last time I paid a utility bill was around 1991, so I’ve had plenty of time to forget what it was like dealing with a utility company. I’m emotionally neutral toward them.

    That said, I see the need for some sort of utility company, either one ‘do it all’ or a number of separate function companies.

    We need the grid, the connectivity. Few people are really going to be willing to go without the grid.

    We need a company that owns the “wire”. They deserve to recover costs and make a profit on their investment. Because the wire owner has essentially a monopoly position their reimbursement needs to be publicly determined.

    If we broke the wire owners free from the rest of the grid then we could have a cluster of ‘electricity brokers’. Consumers would sign up with them for their supply and those costs would be added on top of the wire cost.

    Having a choice of brokers would mean competition for both quality of service and price. It would also allow people to purchase “high renewable” electricity if they were willing to pay a bit more (if it actually cost more).

    Then there would be “suppliers”. Wind, solar, fossil fuel, hydro, nuclear, storage, gas peakers, whatever. Brokers would buy what they needed to supply their customers from suppliers.

    That sort of breakup of the utility company monolith makes sense to me. Turn it into the more typical sort of retail merchandising we use for other things we purchase. Sony and Acer make TVs. Costco and Amazon sell TVs. A third party delivers TVs.

    • Edward

      New Zealand has tried exactly this, starting the process in the late 80′s. It’s generally agreed to be a complete farce, and electricity is more expensive than ever, despite a full 70% of the supply being renewable (mostly hydro).

      • Hans

        With a vertical monopoly on power production and distribution there is a hugh incentive for utilities to block the entry of renewables. By splitting the utilities in a strictly regulated grid operator (natural monopoly), and a free market for power production companies and power trading companies it will be easier for renewables to enter the market.

        Since the nineties most utilities in Europe the utilities have been split up this way. The way it has been done has not been ideal, in practice new oligopolies have been created, but it is not a complete disaster. Biggest advantage is that the resistance against renewable energy now comes only from the production companies and not from the grid operator.

      • Ronald Brakels

        If you want to read about the mess we made of it in Australia you can check out this article by economist John Quiggin (the one who used to look like Ned Kelly):

        http://www.guardian.co.uk/commentisfree/2013/jun/17/australia-elctricity-prices-queensland?CMP=twt_gu

  • Shiggity

    Solar PV is the first perfectly scalable, *solid state* energy source humanity has ever had. You can go from 1 panel to 1 billion panels, with relatively easy expansion. No other energy source in the history of humanity could do this.

    • Steeple

      And you can place the production where the demand is.

      But before we get carried away, someone still has to balance the load, manage the voltage and do all of the other complex work required to keep our grids stable. So Utilities aren’t going away, but the may be getting smaller.

  • Marion Meads

    I don’t want to be a milking cow of OPEC and the oil industry, and I want to pre-empt the same exploitation by the Electric utilities when I go to maximize my transportation need using electricity. So I wanted to go Solar PV ultimately to meet all of my commuting and even recreational trips. If I won’t go solar PV, I am very uncomfortable that the oil industry will shift over to utilities and then rape the same commuting public for oodles of money the way they maintain their current lifestyles. To prevent the shift of money extraction from oil to electric, solar PV would be the best answer. However, the solar PV installers are having a field day by charging unreasonably very high profit margins even if the cost of solar panels has come down very low.

  • Marion Meads

    Not all utilities are equal. We hate PG&E while we love SMUD. SMUD got the highest customer rating and satisfaction in the whole USA. SMUD is semi-private, customer-owned, non-profit and putting back extra money into R&D for renewables, instead of raking profits from their customers. PG&E exists for profit. SMUD encourages solar PV, off-the-grid independence while PG&E does the opposite and will only do solar PV connections so when mandated.

    • http://zacharyshahan.com/ Zachary Shahan

      Nice. Thanks for that important nuance!

  • Ivor O’Connor

    Because we hate utilities? They get in our face and tell us we can’t do as we please on our own land. They tell us we must go through endless red tape hurdles. That we can’t even go off-grid unless they ok it. The utilities have a monopoly enforced by our government and we don’t like to let them steal from us. I could rant endlessly on this subject.

    • http://zacharyshahan.com/ Zachary Shahan

      :D rant away! :D This was a pretty open invitation to ranting. :D

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