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New law kills home solar energy in Texas

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El Paso Electric changed the way it buys and sells energy from residential solar homes based on a new law and a public utility commission ruling. Now some of those homeowners are finding that monthly interest on loans used to buy the equipment is greater than energy-bill savings.

"We don't do these things without studying," said Robert Moss, one of the first El Pasoans to install a solar system that can put energy back into the utility grid. "We did this because we wanted to be pioneers and demonstrate that it could be done economically."

Moss, who kept detailed records of the power used by his family, which includes his wife and three teenagers, ran the numbers and thought he could pay off the equipment in about 18 years. After the changes, he is paying about $750 more annually for electricity, which has extended his payoff to more than 40 years, he said, "not including inflation."

http://texas.construction.com/yb/tx/article.aspx?story_id=157854274

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Interested to know what the changes are. I didn't think they could pay you less for the energy you pump back in the grid.

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Interested to know what the changes are. I didn't think they could pay you less for the energy you pump back in the grid.

Under old rules, a kilowatt-hour coming in during the monthly billing period was worth the same as a kilowatt-hour going out. At the end of each month, the account would be settled to find who owed whom.
Now, the kilowatt-hours are valued differently throughout the monthly billing period. For every kilowatt-hour Moss' home produces, he is paid the wholesale price. He is charged retail for every kilowatt-hour he uses. His bill has increased significantly.

This actually makes a lot of sense. Someone that desires to convert their home into a power plant should operate under the same pricing scheme as power plants. If the scheme for power plants is flawed, then changes should be made to the way that prices are set up for all power plants rather than baseed on the power plant's household status. Some things are just more efficiently produced at large scale.

The argument for incentivising solar power may or may not have merit (that is a different subject), but such incentives should ignore the household status of a power plant because household status is not relevant to the merits of solar power.

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This actually makes a lot of sense. Someone that desires to convert their home into a power plant should operate under the same pricing scheme as power plants. If the scheme for power plants is flawed, then changes should be made to the way that prices are set up for all power plants rather than baseed on the power plant's household status. Some things are just more efficiently produced at large scale.

The argument for incentivising solar power may or may not have merit (that is a different subject), but such incentives should ignore the household status of a power plant because household status is not relevant to the merits of solar power.

There are lots of places where large-scale commercial enterprise is more expensive than one guy doing his thing. Look at trucking, or telephone service.

If the little guys were trying to compete with the utility, then I could see them having to play by the same rules. But that's not what's happening here.

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There are lots of places where large-scale commercial enterprise is more expensive than one guy doing his thing. Look at trucking, or telephone service.

If the little guys were trying to compete with the utility, then I could see them having to play by the same rules. But that's not what's happening here.

Electrons are a uniform commodity. It doesn't matter who makes them.

Nobody really cares as a matter of public policy whether some random property owner can reduce their consumption of electricity from the grid by either producing it for themselves or by conserving electricity use. Up to that point, n financial analysis of the benefits of solar panels at a particular property would be done based upon retail pricing, which is the property's only alternative.

However, if surplus electricity is intended to be sold back to the grid operator (and that's what is happening), then they are using the privately-operated power grid and the retail electricity provider's administrative services to compete within the market for electrons. There should not be any incentives for producing surplus power; that might influence the size and scope of residential solar projects, or whether someone opts to do them at all.

To bring the problem home, consider that a provider of electrons from a residential solar power is a free rider on the same grid and the same services that all of their neighbors have to pay for. Under the old pricing scheme, his neighbors paid for the retail-wholesale pricing spread.

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Now that I'm on a real computer, I read the change, and wow.

Someone correct me.

the way it used to work: you use 1500kw of electricity, your solar array makes 1000kw of electricity, you pay the power company for 500kw of electricity.

the way it works now: you use 1500kw of electricity, your solar array makes 1000kw of electricity, you pay the power company for 1500kw of electricity, and they pay you for 1000kw of electricity (at wholesale prices).

this makes sense for feeding back into the grid, because you don't use it when it's producing, but then you do use electricity at night. so you aren't really "using" the solar power you created. and you were using the power company like a big battery.

what if I use batteries to store the electricity, then only suck from the grid when the batteries are dead? what if my AC is using all the power generated by the solar panels, does the solar power 'go out to the grid' and then 'come back to my house' ?

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Now that I'm on a real computer, I read the change, and wow.

Someone correct me.

the way it used to work: you use 1500kw of electricity, your solar array makes 1000kw of electricity, you pay the power company for 500kw of electricity.

the way it works now: you use 1500kw of electricity, your solar array makes 1000kw of electricity, you pay the power company for 1500kw of electricity, and they pay you for 1000kw of electricity (at wholesale prices).

this makes sense for feeding back into the grid, because you don't use it when it's producing, but then you do use electricity at night. so you aren't really "using" the solar power you created. and you were using the power company like a big battery.

what if I use batteries to store the electricity, then only suck from the grid when the batteries are dead? what if my AC is using all the power generated by the solar panels, does the solar power 'go out to the grid' and then 'come back to my house' ?

Yeah, I think I misread it. Or possibly it the article is poorly written, because this would just be so horribly stupid.

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Either way it is not a smart move. There is value to the electricity generators to have extra electricity entering the grid during the day when the electricity usage is at its peak. The solar users only draw electricity from the grid at night when usage is much lower. By flattening peak usage, the electricity generator benefits from not needing as much capacity. The old rule benefited both the solar panel owner AND the electricity provider. The new rule provides a false benefit to the provider in that they only pay wholesale for solar power, but far fewer homeowners and businesses will install solar panels.

Sometimes, giving incentives benefits both sides. Someone didn't think this through.

This article suggests that the new law is every bit as stupid as 'cuda and Niche suggest.

http://www.energymatters.com.au/index.php?main_page=news_article&article_id=57

The homeowner is required to purchase two meters. One measures solar power created and it goes into the grid. The other measures electricity used, and you are billed for it.

Terrible law, pushed by electricity RETAILERS, not necessarily the electricity producers.

Edited by RedScare
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Yeah, I think I misread it. Or possibly it the article is poorly written, because this would just be so horribly stupid.

it was poorly written, so that was my understanding of the change based on what was written.

after doing some searching, I can't find any reference anywhere that states the way texas does net metering changed recently.

I found a website that explains what the law is currently:

http://www.powertoch.../_about/drg.asp

and there's a link with policies that different providers have based on the law.

it appears to be VERY loose and more or less whatever the provider wants to give you.

so what I said above about the way it did work, and the way it does work, may be true for that particular energy provider, but isn't necessarily the case for the whole of Texas.

As RS references above, it looks like there is now a law that allows providers to make you install a meter for outgoing as well as incoming...

Edited by samagon

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it is my understanding that Texas has always exempted CO-OP power providers and city owned utilities from the net metering rules

I am too lazy right now to see of the utility in question is city owned or not, but if it is they could refuse net metering all together

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