Comments on: Sunrun Supports Net Metering, Not Feed-in Tariffs or Value Of Solar Tariffs

By: Bob_Wallace

Bob_Wallace — Wed, 28 Aug 2013 05:00:00 +0000

FiTs higher than retail price can do a lot to build an installation industry and drive prices down.

If you can install and sell at a sweet profit then most people are going to want to maximize that profit. They’re going to put pressure on installers to keep the cost minimal.

And a lot of people seeking those profits will create a lot of demand which brings players into the market early, then supports the best via volume work as the industry matures.

That, I think, is how Germany drove their solar capacity high so rapidly and brought them to the place where their average system price is almost half ours.

Our system lacked the motivation of short term significant profits.

By: Anon

Anon — Tue, 27 Aug 2013 22:40:00 +0000

Also… Dirk is severely mischaracterizing the incentives of FiTs vs. NEM.

In a NEM regime you have an incentive to size your system to deliver 100% of your annual usage so that you cancel out your bill. If you design the system right you’ll get retail value for all the solar electricity you make. NEM systems on inherently oversized and they lean heavily on the grid. Things wouldn’t work if everyone on a circuit sized to the incentives provided by NEM. You don’t have an incentive to oversize under the current FiT in Germany – you certainly used to but that time has passed. In Germany you actually have an incentive to undersize your system because your goal isn’t to make as much electricity as possible. Your goal is to use as much electricity that you produce as possible. If you use the electricity you capture retail value whereas if you sell it you only get the FiT which is currently 14.8 cents/kWh for sub-10kW systems. Depending on how you do the calculation 14.8 cents/kWh isn’t much higher than your production costs with cover a range of 10 to 15 cents/kWh depending on a wide variety of factors.

Don’t trust SunRun. They’re feeding you bad math.

By: Anon

Anon — Tue, 27 Aug 2013 22:28:00 +0000

The reason why SunRun is against FiTs and VOSTs is that they see these programs as competition. If you get compensated for your production you can potentially be classified as a business. If you are classified as a business you can depreciate the value of your PV system. You may only get to use linear or declining balance depreciation but you could potentially get to use Accelerated versions. Solar advocates don’t think about depreciation much but when you put the numbers in a spreadsheet you can immediately see the financial benefits. You lower your production costs by 25 to 30%. That’s a chunk of change.

To repeat… If we had a VOST or a FiT residential solar systems could be depreciated. That would swing the balance in favor of personal ownership over third party ownership. This undercuts SunRun’s business model.

You have to remember who SunRun is. These are the same guys that lobbied against PACE. They’re cheeky monkeys. They’re not idealists looking to spread solar in an optimum manner. They’re a business looking to spread solar in a manner that makes them as much money as possible.

By: JamesWimberley

JamesWimberley — Mon, 26 Aug 2013 23:04:00 +0000

Sunrun ¨ … they [FITs] put a ceiling on solar deployment …¨
Only in tentative US experiments. National FITs in Europe follow the German model of no capping and regulating the volume by frequent downward adjustments.
The key points are no capping, tranaparency, predictability, and a right to sell. Both net metering and FITs are adapting to the low cost of solar and the issue of paying for grid integration. Germany deals with these within FITs by setting them below the retail rate. With net metering, you have to go the VOST route. Either way, it´s inevitably become a battle with incumbent fossil generators.
Solar and wind advocates should spare a thought for batteries, CSP and geothermal. They deserve a premium price for dispatchability, perhaps through a capacity market. (Very soon, homeowners wil be deciding about top-up batteries themselves.) Gas will also claim this premium: the argument for not paying it is the climate.