Monthly Archives: November 2017

Net Metered Distributed Energy

While the rest of the world’s governments continue to move ahead with the development of sustainable energy supplies, the Trump administration seems to be operating in reverse gear. President Trump has famously declared that global warming is a hoax promoted by the Chinese. He pulled us out of the Paris Agreement (to reduce global warming) claiming that China would gain an advantage if we were forced to reduce our use of fossil fuels.

Ironically, it appears that China will now be looked to as the world leader in the development of sustainable energy. They are deploying both solar and wind energy plants at a rate that no other country can match.

Although the Trump administration can’t see the future, states, communities, and even individuals do and can work for a sustainable future and save money in the process. The cost of solar arrays continue to fall. The payback period for solar arrays is now below 10 years. With lifetime guarantees of 25 years, one can recoup considerable savings and help clear the air.

For home owners and small businesses the most cost effective approach for solar is to grid tie the system. Connecting the array to the grid allows for net-metering. When the sun is shining and the solar panels are producing energy in excess of what a home owner or small business is using, that excess is sent to the grid making the electric meter run backwards. This is good for the owners of solar panels but is this good for the power companies that provide the power when the sun isn’t shining.

Right now the Arkansas Public Service Commission (PSC) is considering rule-making which may impact the costs of net metered systems. Power companies argue that grid-tied systems cost them money. But is that really the case? A recent study by Crossborder Energy, specific to Arkansas contradicts the claims of costs to the Power company and in fact finds that net-metered systems save money not only for the owners of such arrays but also for the power companies and their rate-payers. A win-win for both economic and societal considerations.

Solar generation is frequently well-matched with demand. On hot summer afternoons solar arrays replace very expensive peak power that the grid operators must add to their base load. This peaking power is very expensive beyond what solar arrays are paid via net metering.

Solar arrays generate within the grid, thus decreasing transmission costs compared to power that is brought from farther away. Solar is eminently scalable. As the demand within a grid expands with population growth, incremental addition of solar is much less expensive and doesn’t need the the lead time that other large scale sources such as nuclear, which can take a decade or more to bring on line. Solar, on any scale affords more predictable future costs as there are no fears of price fluctuations for fuel.

Societal benefits are quantifiable also. Increased stability and resiliency, cleaner air, a more stable climate are economically beneficial. The use of private capital and private property can leverage additional capital to the benefit of all rate payers, not just the solar array owners themselves.

Finally the study reconfirms that renewable energy such as grid-tied, net-metered energy systems create more jobs compared to energy systems fueled by fossil fuels.