The boom in rooftop solar installations in the Golden State is adding an extra $1.3 billion to bills of homes and businesses without the devices. That’s because power companies in California are required to buy electricity from home solar generators at the same price they resell it to other customers, a system called “net measuring.”
Growing demand for rooftop solar has been driven, in part, by net metering since solar customers avoid charges for energy and for the costs of the transmission and distribution system.
For example, about 20,000 customers of San Diego Gas & Electric (SDG&E) had connected 146 megawatts of solar panels to its grid by November 1, 2012, which accounts for 1.2 percent of its peak load. The company is adding 409 new net-metering customers a month.
However, utilities don’t make money on such sales to help cover fixed costs. So they pass it along to conventional energy customers in the form of higher rates.
SDG&E currently can’t collect between $18 million to $20 million a year in grid costs from customers with rooftop solar panels. The utility will be shifting about $200 million in annual costs to customers without panels when the state reaches its cap.
Southern California Edison will transfer $400 million in annual costs to people without solar systems when the state hits the cap. Pacific Gas & Electric, the state’s biggest utility, will pass on about $700 million a year.
Utilities say the current system is unsustainable, and they worry that conventional energy consumers could eventually provoke conflict, like those seen in Spain and Germany, between renewable-energy advocates and power companies.
That’s why California utilities oppose the state’s efforts to expand net metering programs. But regulators aren’t impressed. In January 2012, the California Public Utilities Commission rejected San Diego Gas’s request to impose a “network use charge” that would have added a fee to customers with rooftop solar panels.
Solar developers also argue that rooftop systems benefit the grid by providing power during the hottest parts of the day, which eases stress on wires and transformers and helps utilities defer maintenance and upgrades.
The growth in solar panel installation and buy backs is driving efforts to raise net metering caps. California revised the way it calculates its limit in May 2012, effectively doubling the amount of solar energy state utilities will eventually be required purchase.
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