Rooftop solar panel owners may be facing a huge math problem

Even when the Public Utilities Commission completes its work today on how people with rooftop solar power installations are to be billed for the power they use and the power they sell to NV Energy, no one will really know whose ox has been gored because the power company still will have to calculate the actual rates and that may take a couple of days. Even then it will take a rocket surgeon to figure it out.

A 113-page draft order, if approved by all three commissioners, will open the door to so-called net energy metering (NEM, in PUC jargon) to TOU (time of use) billing. This was briefly discussed in a previous post.

Originally, NV Energy proposed that NEMs would be paid a wholesale rate of 5.5 cents per kWh for power uploaded to the grid, as opposed to the current retail rate of 11.6 cents. But the wholesale rate the power company pays for electricity depends on the time of day due to power demands and loads.

The draft order envisions paying rooftop solar generators based on TOU, which can be as much as 50 cents per kWh.

That’s when in gets complicated. The PUC is telling the power company to present in its next rate case arguments for whether rooftop solar owners will have to switch to TOU or can opt in or out.

As reported in the morning newspaper, the whole thing has solar panel installation companies squealing that changes in NEM will drive them out of business, but would TOU change the game?

Frankly, it is impossible to calculate until NV Energy applies some hard numbers, and even then it will take a higher level of calculus than I ever mastered.

The whole came up because NV Energy argues that a customer who installs solar panels and becomes a so-called net metering customer cuts his power bill by up to $1,181 a year on average, while the utility avoids no more than $519 in purchased power costs, suggesting ratepayers without solar panels essentially subsidize those with panels.


A backyard solar panel installation.



15 comments on “Rooftop solar panel owners may be facing a huge math problem

  1. Bruce Kester says:

    While TOU can benefit some, let me pass along my experience. My wife and I are retired seniors and spend most of our time indoors during the blast furnace heat of the summer. We have installed a 5KW solar array as a hedge against electric costs on a fixed income. We painfully learned that TOU is NOT for people that don’t leave the house to go to work during the day.

    Call us whatever you will, we have worked too long and hard to be miserable at NV Energy’s behest. After 3 months of quadrupled electric bills I couldn’t get off their godforsaken program fast enough.

  2. Thanks for the advice, sir.

  3. Of course, the power company was only paying you 11.6 cents per kWh for uploaded power, and you were paying 36 or 50 cents for power you purchased during the day, right?

  4. Bruce Kester says:

    Of course. And as my electrons entered the river flowing past my house the usual scenario is they go to my next door neighbor. That 100 feet of transmission costs NVE how much in infrastructure burden?????

  5. Steve says:

    The way TOU works for me is to bank the lower costs in the rest of the year to pay for the summer. Then I raise the AC to 82 in the afternoons while using floor fans to keep the cooler air off the floor and. Also we use the grill for cooking rather than the oven.
    I don’t have a PV system and my costs have gone down with TOU. I have been on TOU since it’s trial began. This is my third year on the program. Basing it’s costs on one summer simply won’t tell what the reality is.

    You want only to pay for the short transmission length to your neighbor’s house.
    That doesn’t work in grid scale use.
    If you wish that to be the cost basis of your transmission infrastructure, plug in their house with an extension cord and power them off your excess…..

    Oh, wait, 5kw really doesn’t have excess in the 4 months of summer. So you have to rely on the whole grid for those months and your excess goes to whoever is home during the afternoons on those shoulder months, meaning your electrons go to many homes, not just your neighbor.

  6. Bruce Kester says:

    Well, thank you for the snark in your tone. The dilution of energy I send back to the grid can’t be quantified in realistic terms when ii’s by a factor of hundreds of watts per hour. Trying to come up with an argument suitable for digestion by the low information crowd leads to pretzel logic. On what planet can I get away with NOT paying for infrastructure? It’s just my tough luck that we are less mobile than you. I guess someone has to carry the burden of the infrastructure costs while you are out and about during the day.

  7. Steve says:

    OK, try disconnecting from the grid and powering your home 100%

    This is something I have maintained for a very long time, without the price supports, PV doesn’t pencil out at all.
    You are worried about NVE but it was congress that recently saved PV by extending tax credits.
    Those credits don’t benefit retiree’s either. By the time one retires, beating the standard deduction gets difficult, though if you do beat that deduction then you really don’t have much to complain about.

    As for being out and about…since July I have been one of the uncounted unemployed, living on my savings, investments and inheritance. My wife has been stay at home for 5 years, so I know what the costs are. I have all the data for my use.
    I suspect you decided the summer costs were weighing on the off summer costs without actually acquiring the real data.

    A 5KW isn’t enough to power one central AC unit. The offset was never going to be very much.

  8. Bruce Kester says:

    Well, it’s 11:30AM 12/22 and the PUCN just sealed the deal on crushing the life out of residential solar. I can imagine how encouraged Steve is.

  9. Steve says:

    Not at all, Iv’e been saying all along the only way PV makes any sense is to take devices off the grid.
    TOU makes this much more possible.

    One central AC unit needs (on average) 7kw to start up the compressor. A 10kw PV system is desirable for this. An automatic switch makes the process easy, these are used for back up generators but could be used to make grid the back up and PV the primary. When the sun stops producing enough the switch goes back to grid power. Good inverter required but no batteries needed.
    What this does is take the large items off the grid during peak power rates and you get to have the temperature whatever you like. In the off season you could take just about the whole house off the grid for the day time.

    BTW, snark was begun with electrons traveling 100 feet to the next door neighbor.

  10. Vernon Clayson says:

    Along with his “fundamental transformation” Obama promised that electric rates would “necessarily skyrocket”, that wasn’t empty campaign rhetoric, we reap what Obama and his lapdogs in Congress sowed.

  11. Bruce Feher says:

    And this is a surprise because??? Face it, the entire system is rigged against the middle class. Always has been. always will be.

  12. Steve says:

    The goal was to go off grid for this air conditioner. It uses batteries and even with those, he still has to use an automatic switch (to switch in the grid) because the batteries don’t last all night.
    This is what I am talking about, this actually gets solar PV to make sense from a residential perspective. Designing something similar without batteries is entirely possible.
    The “inverter” air conditioner is what makes it possible to have such a small number of panels about 1800 watts. Apparently “inverter” air conditioners don’t have the start up consumption regular units do. I note he got rid of his 18,000 btu unit for the 10,000 btu inverter air conditioner unit.
    Any existing solar installations could easily be converted to operate devices, off grid, along these lines.

  13. Steve says:

    Came back because I just read this from the RJ;

    Then I saw my earlier comments about running central AC off PV,,,to clarify that, I was using figures built off my 27 year old unit that will need to be replaced some time soon. The searches I did as a result of today’s discussion have shown me what I want to get for a replacement unit.
    Now come on new employer!

  14. […] installing rooftop or backyard solar panels. The PUC ordered NV Energy to start charging so-called net energy metering (NEM) customers a connection charge and to slash to credit for power uploaded to the grid from the retail rate to […]

  15. […] Rooftop solar panel owners may be facing a huge math problem […]

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