Solar Pushback: Some Utilities try to Sabotage Solar Incentive Pricing
Utilities are beginning to push back on solar, according to the New York Times article, “On Rooftops, a Rival for Utilities.” They claim costs to non-solar users will go up as the fixed costs of the distribution grid are spread over progressively fewer customers. And they want to curb “net metering,” in which solar homeowners get to sell power back to the company at a decent price.
Well, they’ve had 40 years to figure out that solar is coming—and that the market will enjoy the idea of a power source that doesn’t have to be purchased over and over again, and isn’t tied to the sharply rising prices of oil, coal, gas (currently enjoying lower prices), or nuclear with its high capital costs, abysmal safety record, and potential for catastrophic accident.
Yet many utilities actively promote solar—because it reduces the demand for new powerplants, which are not only extremely expensive to build, but also face massive citizen opposition and extensive regulation. Plus, distributed solar—generating the power at the point of use—eliminates the huge friction losses of transmitting power over vast distances. Transmission losses are one of the utility industry’s dirty little secrets, and one of the reasons why I’m not a huge fan of massive solar or wind farms. It is absurd to me that we squander 7 percent of the energy we generate, just moving it around.
I suspect that most solar construction is on-grid, where the solar system supplies power to the utility when it’s sunny, and draws power back out at night or during extended cloudy periods. The utility grid serves as a giant battery.
Utilities need to reinvent their business model, which is based on a percentage return of capital investment (a rather high return, at that). Surely there are other ways to maintain a power grid.
