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- A Conversation with SDG&E
Proposed Solar Fee
A Conversation with San Diego Gas and Electric:
Me: Hello, San Diego Gas and Electric? I’ve had trouble getting through on the phone. I guess you must be fielding a lot of calls lately. I have several questions, but don’t worry. I’ll fill in your answers for you.
Me: First topic. SDG&E is committed to renewable energy, right?
SDG&E: Of course. We are actively installing wind and solar plants right now. We are required to have 20% of our electricity from renewable sources by 2020.
Me: That’s great! Are you using local companies for these projects to bring revenue to California? I know there are hundreds of wind and solar companies in the state.
SDG&E: Well, not exactly. The projects will provide jobs in California, but both contracts have been awarded to companies with headquarters in France.
Me: I see. That doesn’t seem right, but let’s move on. You are a utility company, right? What does that mean?
SDG&E: Yes. We provide a service most people need to function in modern society. Other utilities are things like cable TV and phone service.
Me: Thanks. Now, if I’m unhappy with my phone or cable service, I can choose to cancel my service and switch to another company. I get offers for that in the mail every day. If I’m not happy with my service from SDG&E and want to cancel, what other company can I use in San Diego?
SDG&E: Actually, we are the only electric company in the area. We control all the power lines, substations, and other equipment. You don’t have a choice.
Me: Thanks, I just wanted to make sure. I was pretty upset about that blackout a few weeks ago. By the way, I see on my bill that there is a fee for “Reliability Services.” Am I going to get a refund for that because of the blackout?
SDG&E: Next question please.
Me: Now I see on the news that there is a big debate over residential solar systems. You claim that a person who is connected to your utility grid is costing you over $1100 a year. Is that correct?
SDG&E: Yes, so we are trying to impose a fee on those solar customers. We already charge them a $5 per month connection fee, but that is not nearly enough. We want to charge them an additional 3-4 cents per kilowatt hour.
Me: I see. How does it work right now when someone who has solar power is connected to your utility grid?
SDG&E: We set them up with a Net Metering agreement. They get credits for any kilowatt hours they produce during the day over the amount they use. They can use these credits at night or anytime they need extra electricity. If they need even more electricity, they get it from us. We settle up with them once a year.
Me: That seems fair. What happens if they settle up at the end of the year and they have credits for producing more kilowatt hours than they used?
SDG&E: We pay them 3.4 cents per kilowatt hour.
Me: So if they produced an extra 1000 kilowatt hours, you would send them a check for $34?
SDG&E: That is correct.
Me: And what if they don’t produce as much as they use? What if they ended up owing you for 1000 kilowatt hours?
SDG&E: Then we charge them for those kilowatt hours at our Baseline rate of 14 cents per kilowatt hour. They would owe us $140.
Me: Let me get this straight. Let’s say there are two homes next to each other with Net Metering agreements. If one overproduces 1000 kilowatt hours, you pay them $34, but charge their neighbor $140 for using the same 1000 kilowatt hours of electricity?
SDG&E: That is exactly how it works right now.
Me: Then it seems to me that solar customers are providing you with electricity you can sell for a substantial markup. I fail to see how they are costing you extra money, so let’s keep going.
Me: Does everyone pay 14 cents per kilowatt hour for their electricity?
SDG&E: That is only for the first few hundred kilowatt hours and depends on where they live. After that we increase their rate to 17 cents, then 31 cents, and finally 33 cents per kilowatt hour.
Me: So the more electricity someone uses, the more you charge them per unit of electricity? That seems to go against the laws of supply and demand.
SDG&E: That’s how it works. Customers who are conservative users get a huge price break and heavy users are severely penalized.
Me: Tell me about Time-of –Use metering.
SDG&E: This is something we do for businesses now and want to impose on residential customers in the near future. Basically, it costs us a lot of money to provide enough electricity to keep up with peak demand during the day. With TOU metering, we charge people a lot more for electricity used during the day(On-Peak) and less for electricity used at night (Off-Peak).
Me: So would you say this is actually providing people with an incentive to use less electricity from your grid during the day and more electricity at night?
Me: Then would it be reasonable to say that an ideal customer would use no or very little electricity during the day and draw most of the power they need at night?
SDG&E: Yes. It saves us a lot of money by decreasing our peak demand so we pass the savings on to our customers.
Me: Understood. When it comes to your customers with solar electricity, when are they feeding their extra power into your grid?
SDG&E: During the day.
Me: And when do they draw power from the grid?
SDG&E: At night.
Me: So they provide you with extra power during peak hours and draw their electricity at night when it is less expensive for you to provide it?
Me: Ok, I just want to be perfectly clear on this. A customer who is tired of paying your ever-increasing electricity rates goes out and spends thousands of dollars on a solar electric system. This system provides them with the electricity they need during peak hours, reducing demand on your grid. It also has the potential to provide extra power you can sell to other customers at a 400% markup. You now want to charge them hundreds of dollars in additional fees per year.
SDG&E: That is correct.
Me: In that case, you may want to contact your utility company. I’m guessing that somewhere in that 21-story skyscraper downtown, gas is leaking at an alarming rate.
Adam Garcia 92104
More like this:
- Go solar, get screwed by SDG&E starting today — Dec. 1, 2017
- SDG&E Giving Thanks For Low Supply Leading To High Electricity Prices For Daytime Vehicle Recharging — Nov. 26, 2010
- Some Backup Benefits to Off-Grid Solar Panels — Sept. 1, 2010
- Per Watt Savings from Off-Grid Solar Panels Balance SDG&E Proposed Rate Hikes — Aug. 18, 2010
- SDG&E Gets Special Treatment of Billing for Electric Vehicle Recharging — June 25, 2010