Fair Rates for Solar and Storage Customers
The California Solar & Storage Association intervenes in rate cases at the California Public Utilities Commission to stand up for the value of customer-sited energy solutions. Regulators must take into account the impacts of rate changes on customers that have invested in solar and customers that are seeking to help further the state's clean energy goals. Every utility rate change has to be approved by the Commission, and we take a seat at the table to stand up for the right to generate your own power.
Although the optimal price signals for solar and storage are often different, utilities for the foreseeable future can offer options that work for solar-only and options that work for solar plus storage.
Evening Peaking Time-of-Use Rates
The change in TOU rate structure to having higher rates in the evening and lower rates in the middle of the day is a fundamental shift in the economics of solar. We are pushing to maintain multiple options for customers. Some rate schedules should have a mild differential between peak and off-peak rates or reduced demand charges so that stand-alone solar still makes sense. Other rate schedules should have a wide differential or high demand charges to encourage customer adoption of storage.
Utilities are repeatedly pushing for approval of high fixed charges and the introduction of demand charges for residential customers. They would prefer that half of your bill is a big fat fixed charge. We helped win approval of a minimum bill instead of a fixed charge while utility fixed costs are studied. When fixed charges come in the future, we will fight to keep them low. There is a state law limited residential fixed charges to ten dollars per month. We believe we can maintain that cap and keep demand charges out of residential rates.
Each of the state's largest utilities has a rate schedule designed for the particular needs of customers with electric vehicles, and those rates also work well for energy storage. PG&E will soon allow customers with energy storage systems to use EV rates. We are pushing the other utilities to do the same.
Dynamic Rate Options
Energy storage can respond to changing price signals. Utilities' costs of buying power change with the wholesale market, and they can reflect those costs in dynamic rates. Commercial customers should have the opportunity to avoid drawing power from the grid when supplies are tight in exchange for very cheap power when supply is plentiful. Statewide weather conditions have a major impact on the wholesale market due largely to increased energy demand from air conditioning. It is not hard to predict those dynamics and store energy for times of high statewide consumption.
Customers that have invested in on-site energy solutions in response to existing price signals expect those price signals to change only gradually. Any major change in rate design must include grandfathering provisions to allow solar and storage customers to recoup their investments. The Public Utilities Commission has recognized this principle. The Association pushes for grandfathering to be fair and inclusive.