This blog was written by John D. Wilson, former Deputy Director for Regulatory Policy at the Southern Alliance for Clean Energy.Guest Blog | November 10, 2011
Ever thought, “Hey, wouldn’t it be great if I could put a solar panel on my roof and get paid for it by the utility?” Well, this 2-part report from a San Diego TV reporter is a pretty good primer on the issues you would face.
Check out the videos after the break (they both start with ads) …
Verdict: For SDG&E. If you put so many solar panels on your rooftop that you are due a check in the mail, that makes you a wholesale power producer. You deserve equal treatment with other wholesale power producers. Now, whether SDG&E’s rate is fair to its wholesale power producers is another question. My take on utility regulation is that homeowners don’t get a bonus because their panels are on a home rooftop as opposed to down the street in a big field.
Verdict: For homeowner. SDG&E wants to charge solar customers for distribution charges.
The company’s argument is that the homeowner is effectively being paid a retail rate for electricity that it generates which the utility then pays to distribute to other customers. Given just that information, I’d agree with the customer.
However, the customer is generating electricity at peak periods of the day, and using utility-supplied electricity at off-peak periods of the day. On peak, line losses are much higher than off peak. Generating distributed power can be a highly effective way to reduce line losses, which cuts costs for the utility on more than a kWh-for-kWh basis.
Time of use rates and other techniques could balance things out. But for the utility to claim that the customer isn’t paying for all the benefits … well, the utility is likely not paying for all the benefits of the customer’s solar panels, either. This news story doesn’t dig deep enough to understand all those details, but based on the information in the videos I think the homeowners might have a legitimate dispute.