Utilities fighting against rooftop solar hasten their own doom

❝ Several of the big trends in clean electricity depend, in one way or another, on batteries. How fast batteries get better and cheaper will help determine how fast renewable energy grows, how fast fossil fuel power plants get shut down, and how fast the vehicle fleet electrifies.

The consulting firm McKinsey & Company recently released an analysis noting that batteries, like solar panels before them, are getting cheaper much faster than anyone expected — and the consequences for the power sector are going to be immense…

❝ As they get cheaper, batteries make sense for more commercial applications. As new markets for storage grow, demand for batteries increases. As demand increases, economies of scale kick in and batteries get cheaper. Rinse, repeat…

❝ The whole analysis is interesting, but I want to focus in on the way batteries will affect rooftop solar. Across the country, intense battles are being waged as utilities push back against the rapid spread of rooftop solar….Batteries, McKinsey reveals, are going to scramble those battles, making them effectively unwinnable for utilities. The existential crisis they hoped to avoid by slowing rooftop solar is going to slam into them twice as hard once batteries enter the picture…

❝ When a customer installs solar panels, it hurts the utility in two ways.

One, it reduces demand for utility power. Utilities generally don’t want lower demand. To justify building stuff, they need to be able to project higher demand.

Two, the more solar customers reduce their utility bills by generating their own power, the more utilities have to charge other, non-solar customers more, to cover their costs-plus-returns. This pisses the other customers off. And it incentivizes them to install solar themselves!

❝ …Because batteries allow customers to circumvent utilities’ two primary tools for slowing the spread of solar…timing will differ in different markets, but partial grid defection enabled by solar+storage will spread like a virus, starting in sunnier and more expensive areas and spreading from there. And it’s likely to happen within a decade.

❝ …For power utilities, unlike for so many other decrepit American institutions, simply clinging to the status quo is not an option. Rooftop solar can be staved off temporarily with fees and rate tweaks, but as batteries get cheaper, those strategies will stop working. More and customers are going to generate, store, and manage more and more of their own power.

The VOX article opines that the power utilities will have to come up with “other services to provide, other roles to play in the power system of the future”…and offers no suggestions. I can’t think of any either.

7 thoughts on “Utilities fighting against rooftop solar hasten their own doom

  1. keaneo says:

    Our public utility here in New Mexico – PNM – is about as sharp as the passenger pigeon. Except the pigeons didn’t deserve extinction.

    This state is ideal for producing both solar and wind-generated electricity. Well enough to have been a green energy-exporting state for decades. PNM – most likely for all the wrong reasons – committed to coal. Even buying their own mine from scumbag Peabody.

    They will get what they deserve. Which is net zero!

    • Norteño says:

      Here’s how the deck is stacked in Northern New Mexico as the result of a policy illegally implemented by the Jemez Mountains Electric Cooperative Board of Trustees [”Los Sombras Siete’] concerning net metering for member-owners:
      “…if a customer with a qualifying facility [IE: a solar panel system or other renewable energy source] uses 300 kilowatt hours of electricity in a billing cycle at a rate of 13 cents per kilowatt hour, they would pay $39 for that electricity.
      If the person paid at the rate the Co-op purchases the electricity from Tri-State, they would be paying $22.50.
      This is in addition to any applicable fees charged by the Co-op.”
      “Jemez Co-op Raised Electricity Rates Without Approval” [Rio Grande, Espanola N.M. July 18, 2019] http://www.riograndesun.com/news/jemez-co-op-raised-electricity-rates-without-approval/article_c0b03ec6-a968-11e9-b9b4-2b038e52781b.html

  2. Reddy Kilowatt says:

    “Droughts and high temperatures caused by climate change could play havoc with the electricity supply of the Western United States, say engineers in a study published in Nature Climate Change. As of 2010, more than 90 percent of America’s electricity is generated by thermoelectric power stations — facilities that use heat to create electricity, from burning coal to nuclear power. Many plant like this, however, rely on water for cooling, with these facilities accounting for 45 percent of water withdrawals in 2010 (these figures are calculated every five years) — more than agriculture. If there’s less water in the nation’s rivers or even if that water is just hotter than normal then power stations won’t be able operate at full capacity. And as the recent drought in California shows, this is more than just a speculative scenario” (see links). Power stations classed as “vulnerable” make up 46 percent of total capacity in the West and include not only thermoelectric plants, but also renewable sources such as hydroelectricity, wind turbines, and solar plants. The scientists note that in the case of a 10-year drought event, capacity could drop by as much as 8.8 percent. Power providers work within fairly slim margins of error, calculating how much electricity is left over after meeting peak expected demand. In the West, this margin is typically between 10 to 20 percent, although in some areas it may be in the single digits.

  3. Anterógrado says:

    “Over the past six years, rooftop solar panel installations have seen explosive growth — as much as 900 percent by one estimate.
    That growth has come to a shuddering stop this year, with a projected decline in new installations of 2 percent, according to projections from Bloomberg New Energy Finance.
    A number of factors are driving the reversal, from saturation in markets like California to financial woes at several top solar panel makers.
    But the decline has also coincided with a concerted and well-funded lobbying campaign by traditional utilities, which have been working in state capitals across the country to reverse incentives for homeowners to install solar panels.” https://www.nytimes.com/2017/07/08/climate/rooftop-solar-panels-tax-credits-utility-companies-lobbying.html

  4. SWFLsolar says:

    It is all about people actually getting installations. If someone feels that solar is the future get information on going solar and if this makes sense for you GO SOLAR! The industry will adjust and adapt or go the way of the horse and buggy.

    The key is to actually install the solar. Simply go solar.

  5. Ooga Booga Booga says:

    “America’s Electrical Grid Prepares For The Shock Of A Total Solar Eclipse” (James Conca, Forbes 8/8/17) https://www.forbes.com/sites/jamesconca/2017/08/08/americas-electrical-grid-prepares-for-the-shock-of-a-total-solar-eclipse/#6bf4338467ee See also “The lies and distortions of James Conca and his Science Media Centre advisors concerning the health of the children of Fukushima” https://nuclear-news.net/2014/07/05/the-lies-and-distortions-of-james-conca-and-his-science-media-centre-advisors-concerning-the-health-of-the-children-of-fukushima/
    FYI: The August 21st eclipse in the U.S. will take 2-3 hours from start to finish with the total eclipse occurring for only about a minute on the edge of the path of totality to a maximum of 2 minutes, 41 seconds at the center line in Southern Illinois and Western Kentucky, according to the National Park Service. The times of darkness from the eclipse will shorten as you move away from the path of totality, with the areas the furthest away experiencing on a few seconds of darkness.

  6. Mike says:

    “Solar panels could flood sunny Alabama with cheap, clean power. What stands in the way?” https://grist.org/article/the-fight-for-cheap-solar-is-going-south/ This April, the Southern Environmental Law Center (SELC), filed a complaint against Alabama Power to the state’s Public Service Commission, the power company’s regulator. The complaint argues that Alabama Power’s fee for small-scale solar users is “unfair, unreasonable, unjust, discriminatory, contrary to the public interest, and otherwise unlawful.” “It appears to be the most punitive charge on rooftop solar customers by any regulated utility in the country,” says Katie Ottenweller, a senior attorney for SELC and leader of the center’s solar initiative.
    The barriers built into Alabama’s energy market are just one example of the political, financial, and regulatory dynamics that can block low- and middle-income households from using rooftop solar power in the Southeast. But this tug-of-war between utility companies, regulators, and solar advocates isn’t just about money. “It’s a real social justice issue,” says Greer Ryan, a renewable energy specialist at the Center for Biological Diversity, an Arizona-based environmental organization. “Anything that makes it less economical for people to go solar is going to be harmful for low- and median-income consumers,” she says. It’s like raising taxes on people who can least afford it — putting green energy out of reach for everyone but the wealthy.

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