Local power company solar tax - can this be avoided?

[lrgcoffee]

I am investigating going with on-grid solar at my home, and have been discouraged by my local power company's policy of charging me a premium for the power I use from their system if I also have solar. They charge ~5.50/KW.

My understanding is that they can do this because I must gain approval to attach my solar system to their grid if I want to sell excess power back to them.

My question is, can I avoid their tax/penalty if I don't care about selling back to the grid? Is there a way to attach a solar power system to my home to supplement my power usage? What are the technical limitations that prevent me from doing this?

I understand that I could go with an off-grid solution with no penalty, but that would be a battery backup and would need to be manually switched or I would need to have it connected to whatever devices I want to use solar full-time.

Is there a non-penalty solution that allows me to use up to my capacity of solar power at any given time that would then switch to grid power when needed?

 

[svetz]

Net metering is required by federal law, but some states only offer a fraction of the cost back. Frequently there's some associated charge for "line maintenance", which is to compensate them for your using their lines to make money with your power (some places waive that as even with net-metering buying power from you is cheaper than a peaker plant or out of state).

I'm assuming what you meant was you're paying $0.055/kWh ... which seems unbelievably low. For example, where I'm at power costs $0.138 to $0.112/kWh depending on usage. There's no charge here for net-metering though and I what I pay to import is what they pay me to export.

To answer your question though, yes... almost all modern inverters have a zero export functionality so you wouldn't need a net-metering agreement.

 

[lrgcoffee]

Net metering is required by federal law, but some states only offer a fraction of the cost back. Frequently there's some associated charge for "line maintenance", which is to compensate them for your using their lines to make money with your power (some places waive that as even with net-metering buying power from you is cheaper than a peaker plant or out of state).

I'm assuming what you meant was you're paying $0.055/kWh ... which seems unbelievably low. For example, where I'm at power costs $0.138 to $0.112/kWh depending on usage. There's no charge here for net-metering though and I what I pay to import is what they pay me to export.

To answer your question though, yes... almost all modern inverters have a zero export functionality so you wouldn't need a net-metering agreement.

I also thought it might be /kwh, but I double checked before posting, and the release from our public service commission says $5.46/kilowatt. I'm not sure how that's measurable or what it means. I do know that it is an additional fee for customers who use solar to supplement their power. Our rates are pretty low here. I think they are around .09/kwh, so maybe the fee is on top of that, meaning our rates for solar customers are .145/kwh.

From what I'm understanding from your reply, though, is that most inverters give me the option of "zero export" which should allow me to not need to install the additional equipment for the power company. From your & others' experience with this, are there any legal/permit/inspection traps that I should beware of that the power company would use to compel me to register as a solar customer and be subject to their solar penalty?

Thanks for your response!

 

[Ampster]

They charge ~5.50/KW

Could that be a monthly fixed fee based on capacity if the system? From your subsequent post it sounds like it. You would have to do the math based on when you use power to see if it would be worth your while. As @svetz mentioned almost any system can be configured to be non export. I have done the math on the cost of batteries and based on a 7 year life the batteries alone cost me $0.10 per kWh used over their lifetime. That does not include the incremental cost of the type of inverter that use batteries versus a simple Grid Tie inverter.

The only way i can rationalize that is I am in California with peak rates aa high as $0.50 per kWh. I also have power outages.

 

[svetz]

Check the specs on the inverters you like for a "zero-export" feature (some may have a slightly different name) to be sure it does.

...I also thought it might be /kwh, but I double checked before posting,

I bet it's a typo on their site... the people doing the web site probably just don't understand how stuff works. Can you post a link so we can see?

 

[Hedges]

Is $5.46/kilowatt a one-time connect fee? A monthly fee?
A PV system of 10 kW peak would make about 55 kWh/day average over the year (more or less depending on latitude and weather.)
I put in one that size. Used to have a minimum bill of $6/month (now $10/month) even if no net consumption.
The rate they charge may turn out to be not bad, much cheaper than batteries.
But, if you put in PV that only reduces your consumption by 50% during afternoons when you run air conditioning, your bill could go up if you are forced onto a time of use schedule with triple the rate during peak times.

View the "tariff" or rate schedule itself, see what charges would be.

 

[lrgcoffee]

Check the specs on the inverters you like for a "zero-export" feature (some may have a slightly different name) to be sure it does.


I bet it's a typo on their site... the people doing the web site probably just don't understand how stuff works. Can you post a link so we can see?

I cannot find a rate table on the power company's site, but this is the story I'm basing this on:

PSC Allows Alabama Power To Raise Fee Charged To Solar Power Users

Solar power users in Alabama will see a new fee after a vote by the Alabama Public Service Commission this morning.

wbhm.org

 

[svetz]

"President Twinkle"?

This sounds like a spoof... anyway... it's just a reporter that doesn't understand power. But, I'm fairly confident they got the state correct, let me see what I can dig up.

 

[Steve_S]

Things vary by Jurisdiction which is hard because one place may have rules & fees that another does not and everything in between, makes it a "challenge" to say the least.

An increasingly common configuration now is to NOT supply or back feed into the grid, but to rather use the grid as Backup to the Solar / Battery based system. Many Inverter systems can accommodate such BUT NOT ALL ! Even some of the All-In-One systems from Growatt & MPP units some folks are using here. With using such a method that is NOT capable of back-feeding to the grid, it becomes nothing more than a Fancy Battery Charger, as far as Power Co's are concerned. I have yet to hear ANY Country/State/Province anywhere say you cannot have a Battery Charger and Batteries (Home UPS) and if it happens to use Solar Panels for charging primarily, well it has nothing to do with Big Power Co and the Governing Mentals. Of course the standard grid connection service fees still apply and charges for any grid power you do use to run your home and/or for charging your batteries. THE ADVANTAGE OF THIS, Is you can do it in stages and build up towards fully independent over a year or two, especially if DIY'ing it. Tax Credits & Rebates is yet another pile of mad mayhem to sort through, most if not grid connected with a FIT (feed in tariff) program then you get no rebates etc... But on the other hand, you are not paying Monthly Hostage Fees to BIg Power Co., so in a manner of speaking you get the rebate back over the time that you haven't had to pay the ransom.

 

[Ampster]

I agree with @Steve_S. The concept is often called "behind the meter". In other words the power company has no jurisdiction over what you do behind the meter. You do need a building permit in most jurisdictions. As prices of batteries come down the economics of those kind of systems compare favorably to the monopolistic pricing of some of those utilities.

 

[Ampster]

I don't think they are talking about a new unit of measure. I read it as a monthly fixed fee based on the installed size of a system.

 

[Ampster]

I'd agree with you if it was quoted at $5.50/month... but it's not... they tossed in kW so it looks consumption based.

The per kW was used for the size of the system. The writer of the article even gave an example of a 5 kW system paying over $25 per month. I interprete that to mean $5 per month per installed kW size of a system.
You could be correct if the writer has it wrong.

 

[svetz]

...You could be correct if the writer has it wrong...

No, you were right... found another reference... basically it's as you say... the new rate is something like $5.41/kW of solar installed per month. Deleted the other posts since they were just wrong. Thanks for keeping me honest ;-)

... state regulators' approval of Alabama Power’s fee. It requires some solar-generating customers to pay $5 per kilowatt each month (according to Alabama Power, whether or not a customer pays that fee depends on their rate). For a 5-kilowatt system, that equates to $25 a month, $300 a year...

 

[svetz]

So, is it worth it to net meter in Alabama?

Let's say you have a 10 kW system and use 7 kW on average. So, (10-7) * insolation of 4 x 31 = 372 kWh exported. The OP said 9¢/kWh, so that's $33 bonus at a cost of $50. So, not worth it there.

Let's say you have a 5 kW system and use 7 kW on average. So, (5-7) means you have no bonus $ but a cost of $25 per month. But, during the day you're probably producing more than you use, let's say 2 kW over for 5 hours, so that's 10 kWh/d your throwing away if you set your inverter to net-zero. Over 30 days that's $27 of power you had to import. Since net-metering cost $25 and you made $27 it barely squeaks by. But obviously if you use a lot of power during the day (e.g., charging batteries) and little at night from the utility then net-zero would be the way to go.

Updated: fixed the math...based on #13, a 5 kw Array would be $25/month and a 10 kW array would be $50/month.

 

[Hedges]

Yup... found another reference... basically it's as you say... the new rate is something like $5.41/kW solar installed per month. Deleted the other posts since they were just wrong. Thanks for keeping me honest ;-)

Maybe not so bad. It appears they charge you, not for the nameplate power output of your PV system, but rather for the peak power you have drawn (demand) from the grid. You pay $4.46 or $5.00/kW peak (averaged over 15 minute window) which is not cheap if anything has a heavy draw. Alternatively, elect $0.70/kWh rate for 3:00 to 5:00 PM, June through September. So just avoid being a net consumer during those hours (until hours change, as PG&E/PUC did.)

https://www.alabamapower.com/content/dam/alabamapower/Rates/RGB.pdf

 

[svetz]

... but rather for the peak power you have drawn (demand) from the grid...

That's what I though at first too, then deleted those posts... See the last quote in #13...they were kind enough to spell out an example (sorry, didn't get added/edited in time before your post).

I have to hand it to the @Ampster for his comprehension into the minds of the Alabama's state regulators (no insult intended dude, you rock).

 

[Ampster]

Thanks for that. I agree that section is the demand charge section of the tarriff book. What puzzles me is this phrase, "The Capacity Reservation Charge shall be applied to the nameplate capacity of the Customer’s installed on-site, non-emergency electric generating capacity. " There appear to be other options but I will leave that to someone in Alabama to figure out the optimum rate based on their patterns of consumption.

 

[Hedges]

"APPLICABILITY
Required for any customer connected to the Company's system where the customerobtains any portion of its electric requirements from installed on-site, non-emergency electric generating capacity that operates in parallel with the Company’s system, thus rendering the customer a partial requirements customer and requiring the Company to furnish Supplementary, Back-up, and/or Maintenance Power to the premises."

Says nothing about whether or not you backfeed.
Battery backup UPS could be said to not have "generating capcacity", just storage.
But install a porch light with both PV panel and AC charger, and you now have generating capacity that operates in parallel with the Company's system ... requiring the Company to furnish Supplementary, Back-up, and/or Maintenance Power"

Maybe the key is non-emergency. Wire a generator with a transfer switch so it does not operate in parallel with Company's system. It is now emergency electric generating capacity. Test it daily, whenever the sun is bright.

"non-emergency" and "operates in parallel" are ANDed, not ORed. Simply isolating from the grid whenever PV is delivering power seems to be the loophole. This requires either cycling a battery, or disconnecting from PV and transferring back to grid when your loads exceed production. Certainly a PITA.

 

[Maast]

I can only speak to the Outback Radian inverter as thats what I have experience with, but they have a "Net Zero" setting on their inverters in which the inverter prioritizes house electricity consumption pulled from the batteries until the batteries dip low enough to trigger a owner-set level where it starts pulling power from the grid again.

 

[Ampster]

I have to hand it to the @Ampster for his comprehension into the minds of the Alabama's state regulators

Thanks for the complement, but it is more skepticism than comprehension.