Solar power system owners connecting to the grid for the first time are in for a shock as power bills begin arriving, as are existing customers who failed to lock in a temporary reprieve. Effective December 1, San Diego Gas & Electric is implementing a new rate structure for solar customers, moving the "peak demand" window when power costs the most from midday to mid-evening.
Under the new rate structure, residential solar customers will pay 27 cents per kilowatt hour for power from 9 p.m. until 4 p.m. the following day, with prices doubled for the 4-to-9 window. Likewise, solar customers who are able to generate excess power during the late afternoon and evening stand to be compensated more by the utility than for power generated during the day, when the sun is most likely to be shining.
Existing solar customers were given an opportunity to lock in the old "direct rate" flat reimbursement based on the net amount of power taken from or delivered to the grid, or the then-current "time of use" structure for a period of five years from their original installation.
The direct-rate option came with the caveat that it would only be honored if SDG&E was unsuccessful in lobbying efforts to eliminate the more consumer-friendly option entirely (customers who installed solar before June 2016 were told to expect 20 years of plan stability). During a push last summer to drive customers from direct rate to time-of-use many complained of a lack of transparency from the utility.
"A big part of going solar is education about when to use energy — before it didn't matter what time of day you used your energy, you were charged on a volumetric rate," says Daniel Sullivan of Sullivan Solar Power. "Now people need to be mindful of what they're going to do during on-peak hours. You shouldn't be running your pool pump, for example, that's just foolhardy."
Sullivan says solar customers are increasingly including on-site battery storage as a component of solar systems — one of the same battery packs Chevrolet uses in its electric vehicles can store as much as a third of the electricity used by a typical household in a day, recharging during the day and drawing down when consumers would otherwise be stuck with SDG&E's new peak rates and no way to generate power. Inadvertently, Sullivan says, the end result could be even less reliance on the utility.
"We're at the very beginning of a revolution away from the grid. And if the utility keeps going down this path of tinkering with rates in a thinly veiled attempt to shut down competitive technology, we're going to see grid defection. From my view, that's a beautiful thing."