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How should net metering affect your electric bill?

climateer.substack.com

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Re: How should net metering affect your electric bill?

#41
The (privatized) power utility in Nova Scotia, Canada just this week proposed a fee of $8/kWh for solar power entering the grid. It was met with a pretty ferocious response to the point the government started re-writing the legislation that governs utility regulation.

https://www.cbc.ca/news/canada/nova-scotia/premier-vows-to-p...

A very large solar industry has been established around these pricing discrepancies. Not easy to undo (and I guess not obvious if it should be undone).

Re: How should net metering affect your electric bill?

#42
One thing that's missing from this is that with current California net metering, for new solar customers, you can't dump a kWh on the grid at noon and then swap it for one at 7pm at the top of the duck curve.

New plans are all time-of-use rated, meaning that you can only swap kWh within the same time of use band. At least, that's how it's been explained to me, I have not yet been able to find any explicit rules on PG&E's site explaining how time of use and net metering interact. (And for that matter, PG&E goes to nearly excessive length to avoid describing how anything works, what the actual rates and charges are, or generally putting the most useless pablum on their website.)

I think that all of these market designs and pricing schemes need to be made with an eye on getting to the lowest cost zero-carbon grid. Current best models are coming from Christopher Clack at Vibrant Clean Energy, and all his modeling shows that if we deploy lots of distributed solar and storage at meters, and upgrade distribution, we end up saving massive amounts of money over the decades. The reason is that by having distributed solar and storage, you can massively reduce other fixed cost parts of the grid as they age out.

So really we need net metering policy that encourages that sort of capital investments today, and not just in the wealthiest neighborhoods that have good credit scores or $20k to spend on home improvement on homes occupied by owners, but all over the grid, including rentals.

That's going to take not only good net metering policy, but also new innovation in financing and entrepreneurship. Figuring out how to convince landlords to let you install solar and storage all over, and integrating that into a virtual power plant is a nut that somebody needs to crack. Maybe it won't be entrepreneurs, maybe it will be cities making municipal Virtual Power Plants to meet their own ambitious climate goals. But there are a few key pieces missing from the best possible, most economical efficient, energy transition. And if we just let the utilities dictate policy, we will not be getting anything like the most economically efficient grid, we will get grids where they can make maximum profit.

Re: How should net metering affect your electric bill?

#43
post #6

If some states weren't captured by utility monopolies, then solar users would be legally allowed to disconnect from the power grid, potentially solving the first issue. It's amazing to me that this is illegal anywhere.

I mean - if you aren't using any power - the base charge is usually less than $10/m. This doesn't seem like an absurd amount of money to have power when your system inevitably goes down for a time. Additionally - if you want to sell your house - you're going to lose a fortune taking it off the grid. It wouldn't qualify for most financing. It's not worth saving $10/m for almost any rational/economic person.

Yes, but by disconnecting you aren’t contributing to the tragedy of the commons sort of issue the author talks about.

wHaT iF eVeRyOnE dId It?!

Everyone isn’t doing it, and ideally more people would be taking advantage of net metering. Until such time that it is causing real issues with the utility companies being able to keep the lights on, this is all a moot point. If it encourages solar adoption, then it’s a good policy, for now. Revisit discussion when it’s actually close to being an issue.

Re: How should net metering affect your electric bill?

#44
In NYC at least, electric supply charges are distinct line items from electric delivery charges. Consumers do have the option of choosing who supplies their electricity (e.g. namely if you want to buy your electricity from a green source). But the local monopoly is always entitled to charge you for the service of actually delivering said electricity to you.

Both charges fluctuate from month to month. When I still lived in Indiana, the local monopoly lumped together supply and delivery charges into a single line item which, interestingly enough, was significantly lower than what I pay for just delivery now.

The following prices are for roughly April.

NYC (ConEd) delivery charge is ~$18/month + ~$0.123/kWh. Supply is usually something like ~$0.115/kWh.

Indiana (Duke Energy) total cost (including both supply and delivery) was ~$9/month + ~$0.115/kWh.

Re: How should net metering affect your electric bill?

#45
As an ex-power trader active in the californian market, his analysis is incomplete.

The pricing of wholesale market depends on many factors, including 1) the amount of electricity consumed at time T (quantity) 2) the variation on that amount at time T (delta of your quantity) 3) the location (delivery fee for your quantity)

The problem with solar in californa is that electricity is produced when the market does not need it, and that it stops production when the demand increases. The current reality is that 'green' power generation increases the dependance on 'brown' power source for reliability reasons. Your can read more about this here : https://en.wikipedia.org/wiki/Duck_curve

That ''net metering'' thing is to electricity prices what Santa Claus is to christmas presents.

Re: How should net metering affect your electric bill?

#46

It seems to me if it's true that the cost of distribution is something like 77%, then it really argues in favor of more houses being off grid -- For the cost it may have been better to build self sufficiency, and/or micro community grids rather than a giant regional one. The economy of scale in generation is lost in the costs of distribution.

That distribution cost is not at all related to solar. With rooftop solar your power travels across the powerline maybe 1 city block to your neighbor. It's not traveling thousands and thousands of miles.

Re: How should net metering affect your electric bill?

#47
I'm not sure where to start with this article.

Ok, how about here: there is no necessary connection between costs and prices, at all, and this is why some businesses go broke and others are worth a trillion dollars.

Starting completely over with the basic microeconomics correct, there's surely an interesting question about public utilities which are paying prices for electricity which no longer line up with amortization and other costs of provision to be answered.

Everything said about clubs was not-even-wrong, though.

Re: How should net metering affect your electric bill?

#49
post #4
post #2

“In practice, it’s often politically difficult to argue for overt subsidies, and we resort to workarounds like net metering.“ The reason we have so many hidden subsidies (also: tax credits) is precisely the sentence above. It’s the difference between policy and politics. Few policies are designed well because the main force driving their creation is political support (or the lack of it).

"carbon tax" is trouble to enact because you can't expect to rally support for something with the word tax in its name Then people complain about where will that tax money go. It doesn't matter. The government could burn all the carbon tax money collected (& in fact, this would help against inflation) . The purpose is to fix incentives, not find funding

Not only is the "tax" word problematic, but if you call it "carbon pricing" that irks the people who are reflexively anti-market. And no matter what you call it, the sanctimonious environmentalists will fight it because it minimizes the need for heroic personal sacrifice with respect to preserving the environment (frankly, these personal sacrifices probably aren't significant in the first place--the bulk of pollution is industry and transport, especially that which we outsource to China, etc).

Re: How should net metering affect your electric bill?

#50
post #8

I only want solar/wind/etc if I can be off grid.

I can understand why it can be necessary, but why is being off-grid desirable? Having solar/wind/etc is great, but a grid connection gives you a bail-out in case things go south, e.g. an outrageously hot and windless summer night might create a demand that cannot be handled by your battery (if any).

But your price in that case should be really outrageous because your just externalizing the cost of the utility having to build a peaker plant somewhere and run it on a couple peak days a year (and maintain the infra). That cost should be averaged over the year for someone who uses 100% grid electricity, but for someone who only uses it when the production is the most expensive then they are freeloading on everyone else. That is sorta the point of the whole article.

It is also fundamentally the problem with wind and PV even at grid scale. Its true costs are buried behind the (generally) natural gas turbines being built to back it up because the grid can't just say "sorry no power right now, you get to freeze" like happened in TX last year. So, one has to take the max power usage, and assure there is capacity even if it happens to be dark/cold and without wind. Usually there is a fair bit of excess capacity in place to deal with plants have to shutdown for maint/etc so it just becomes a question of assuring that all the plants don't do maintenance at the same time (enron/CA anyone?), and they aren't going to be doing maintenance during the parts of the year when peak power draw happens (generally the dead of winter, and summer).

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