War on Solar Heats Up Nevada Desert
February 29, 2016
The PBS report above leaves out some crucial information.
Although briefly touching on what the benefits of residential/commercial solar installs might be – the report does not spell out those benefits. The biggest one is that a distributed network of solar systems provides energy during the heaviest demand times of day – the midday thru afternoon period – and helps head off the need for rate-payers to finance very expensive “peaker” plants that are designed to make up the difference during those limited time periods, sometimes meaning they are used only on a limited basis thru the year – and are very costly.
A network of solar installations fills this spot very neatly – and was specifically not considered as part of the Nevada evaluation of solar costs. The New York Times piece below hints at the reason – the new Nevada anti-solar rules were written at least in part by ALEC, the American Legislative Exchange Council, a key player in the Koch Brother’s ongoing war on solar.
I fault PBS for not pointing out this easily-googled and critical fact.
Current PV and wind technologies have improved to the point where they can produce enough power to meet the needs of the owner, plus excess energy that can be exported to the grid. When you add the latest utility-grade storage batteries to those installations, along with the most advanced inverters and electronics, you now have a reliable source of energy that can be tapped even when there’s no active generation.
It’s a simple step from using this technology to solve one consumer’s energy needs to addressing the problem in Ohio. Using cloud-based software management, these individual units can be aggregated by a local utility into a “virtual” power plant, or VPP, serving a whole neighborhood, an industrial park or even entire communities. The control systems allows the aggregated power of these systems to be redirected over the local grid at periods of high demand, to any consumer – not just to another DER owner.
The more of these renewable systems with integrated storage are installed in an area, the more they reduce the need to bring additional large-scale plants online to meet demand. And when enough VPP capacity is connected to the grid, the available stored energy and flexible nature of VPPs will make it possible to retire these old, costly and polluting plants. Their extra capacity will have been replaced by VPPs and be fully prepared to meet peak demand.
In fact, we will be better prepared to meet that demand reliably, because distributed VPPs eliminate the potential for single-point failure that is inherent in those large plants. Unplanned outages due to large plant failures also wreak havoc on utilities and consumers, and cause wild price fluctuations. Locating resources close to demand also reduces power losses, and may allow utilities to defer costly transmission and distribution upgrades.
Flexibility, reliability and cost: This is what makes VPPs highly attractive to utilities, while at the same time providing the assurance of reliability to the consumers who own them, as they have first call on their own power.
WHEN President Obama proclaimed in his State of the Union address last month that “solar is saving Americans tens of millions of dollars a year on their energy bills,” he clearly wasn’t talking about Nevada.
In late December, the state’s Public Utilities Commission, which regulates Nevada’s energy market, announced a rate change drastic enough to kill Nevada’s booming rooftop solar market and drive providers out of the state. Effective Jan. 1, the new tariffs will gradually increase until they triple monthly fees that solar users pay to use the electric grid and cut by three-quarters users’ reimbursements for feeding electricity into it.
More startlingly, the commission made its decision retroactive. That means that the 17,000 Nevada residents who were lured into solar purchases by state-mandated one-time rebates of up to $23,000 suddenly discovered that they were victims of a bait-and-switch. They made the deals assuming that, allowing for inflation, their rates would stay constant over their contracts’ 20- to 30-year lifetimes; instead, they face the prospect of paying much more for electricity than if they had never made the change, even though they’re generating almost all their electricity themselves.
The commission justified its decision by citing grid construction and maintenance costs that rooftop solar users haven’t been charged for, but circumstantial evidence suggests that other factors played a role. All three commission members were appointed or reappointed by Gov. Brian Sandoval, a Republican, whose two election campaigns have received a total of $20,000, the maximum allowed donation under Nevada law, from NV Energy, the Berkshire Hathaway-owned utility that is a major beneficiary of the rate changes. Two of Mr. Sandoval’s closest informal advisers, Pete Ernaut and Gregory W. Ferraro, are NV Energy lobbyists.
The American Legislative Exchange Council, which drafts model bills for right-wing state legislators and receives financial support from fossil fuel interests, has campaigned for rates like those the commission adopted, and, according to Greenpeace, NV Energy was at one time an ALEC member.
The outcry among solar users and providers has been so vehement that the commission has agreed to hold a hearing next week to reconsider imposing the new rates on existing solar users, and NV Energy announced a week ago that it would not insist on the retroactive provision. But even if limited to future customers, the rate changes will almost certainly decimate one of the largest residential solar markets in the nation. As a result, residential consumers will have little alternative to NV Energy, which uses fossil fuels to generate more than 80 percent of the state’s electricity.
Charlie Catania signed up the first day he could.
It was May 2014, and the solar-leasing giant, SolarCity, had just come to town — “town,” in this case being Las Vegas, where the retired 71-year-old once worked as a Baccarat dealer. (“The James Bond game,” he explained to me, apparently noticing through the phone that I’m no good at gambling. That was “when the mob used to run this town,” he said. “It was great.”
Catania is a guy who knows a smart bet when he sees one, and putting solar panels on the roof of the home he bought in 1976 seemed to be just that. Smart. And safe — the right thing for the environment and his wallet. Las Vegas, Nevada, of course, is in the middle of one of the hottest, sunniest deserts on Earth. So there would be no shortage of sunlight hitting the panels that would power his home. Plus, the deal with Solar City seemed so sweet. He’d lease the panels, not own them (he couldn’t afford to buy them) but he’d basically be guaranteed low-to-moderate electricity bills for the rest of his life.
Cheap energy from the sun would cushion retirement, he thought.
Now it doesn’t look that way, and he feels swindled.
Not by SolarCity — which recently pulled many of its operations out of Nevada and laid off 550 workers, according to spokesman Jonathan Bass (did you know more people in the United States work in the solar industry now than in coal?) — but by the state of Nevada.
It seems a state that once was in love with the solar industry has, in recent weeks, launched a perplexing, de facto war against it. Here’s what happened: The state’s Public Utilities Commission in December approved a ridiculously wonky but critical change to the way the utility NV Energy pays and bills its solar customers. NV Energy not only will be allowed to boost its fees for solar customers, it also will pay them below the market rate for the electricity that their solar panels put back onto the grid, and which the utility resells.
Instead of paying about 11 cents per kilowatt hour for electricity produced by solar panels, the utility will only pay some solar customers 2.6 cents per kilowatt hour by 2020, according to news reports. That’s a significant decrease. And fees could go from $12.75 to $38.51 for some customers over the same time period. (NV Energy and the Nevada Public Utilities Commission, for what it’s worth, both declined my requests for comment; NV Energy has argued, unfairly, in my view, that it needs the fees to pay for maintenance to its electric grid and that under previous rules solar customers were shirking on paying for the grid they use).
Those changes may sound small, but they’re enough that SolarCity, the California leasing company chaired by Elon Musk, says rooftop solar panels no longer make economic sense in Nevada. And it’s enough to throw people like Catania into financial uncertainty.
“Will it hurt me? Certainly it’s going to hurt me,” Catania told me.
“My wife and I are still going to eat,” he added. “We’re going to pay for food, but I don’t know what’s going to happen. They can do anything they want to me — or people like us.”
I’m hopeful the commission will see the error in its ways. NV Energy has proposed some changes to the rate structure that could bring relief for existing solar customers. A hearing is scheduled for Monday. The commission should take those seriously and, moreover, seek to make solar cost-effective for new customers as well.