Saturday, July 27, 2013

Is Solar Net Metering REALLY a Threat to Utilities?

Intereting article in the NY Times Blog:

For years, power companies have watched warily as solar panels have sprouted across the nation’s rooftops. Now, in almost panicked tones, they are fighting hard to slow the spread...        

The real problem seems to be that solar customers pay nothing under net metering, even though they use the grid.  A few thoughts:

1. Develop a rate for reverse electric flow, as well as forward.  Then solar customers will get charged for their use of the grid, whether it was forward or reverse.  Meanwhile, solar customers should be paid the prevailing wholesale rate for the electricity they provide AT THE TIME THEY PROVIDE IT.  That is, they should get the high daytime wholesale rate if they provide electricity during a hot summer day with all the A/C going.  This seems to be the most economically straightforward way to price things.

2. Stop subsidizing solar, and put in place a sensible carbon tax (aka Jim Hansen).  With such a tax in place, suddenly solar won't need any subsidies.

3. If utilities don't like distributed generation, regulators can suggest a willingness to change policy --- but ONLY IF the utilities meet certain benchmark targets for renewable content in the electricity they provide.