Power Companies Want to Crush Both Innovation and Reliability

US power companies have a very cozy system in place.  They build big power plants to provide base load power which creates many opportunities for high profit speculation when peak power demand exceeds base load power production.  Companies get to recover capital investment costs plus high rates of return from rate payers AND they get to capture excessive profits supplying peak power.

Southern California Edison is now attacking its customers who have gotten fed up with its unreliable power delivery and who have installed solar power systems with battery backup.  SCE claims that, with California’s time of day pricing, customers with battery systems can charge their batteries with cheap nighttime power and run their households from their batteries throughout high peak demand periods when real time rates are high.

Renewable Energy World reports that:

California is no stranger to rolling blackouts. When Charles and Elke Hewitt installed a solar electric system with batteries for emergency backup power on their home this April, they were shocked when Southern California Edison rejected their application for grid connection under their net metering program. And the Hewitt family was not alone. Soon all homeowners with solar electric systems with battery backup in California could be affected by Edison’s stance on backup power.

Edison informed the couple their application for grid connection was denied because the batteries they used to store energy for emergency backup power when the grid went down were considered “power generators” and not energy storage devices, said Charles Hewitt. Edison said Hewitt did not qualify for their net metering program because the utility could not distinguish between power produced by the solar panels and power produced by the batteries, which it considers a nonrenewable source of power, he said. Edison explained their policy had not changed. It was the equipment that had changed.

“We were excited to use our system and stop paying electric bills,” he said. “Summers are peak production for solar and now we are told we can’t use our system. I have thousands of dollars of PV system sitting on my roof that now I can’t use.”

The 3.7 kilowatt solar electric system installed on the Hewitt home in Santa Barbara uses an Outback grid-tied 48-volt battery system for backup power. Hewitt said his battery bank only stores power; it doesn’t produce it. The problem is, the system uses an inverter/charge controller design that does not allow batteries to be separated from the system, he said. In other words, if he disconnects the battery bank from the system, the system won’t work.

When asked if the utility could be worried homeowners will charge batteries during off-peak hours and then sell excess power back to the grid during peak hours (buy low/sell high), Hewitt rejected this idea. “This is a pretty small battery bank,” he said. “Our batteries are metal nickel hydride batteries. There aren’t a whole lot of kilowatts you can pull out of those batteries before they are ruined and they are very expensive. If Edison thinks homeowners will be using these batteries to cheat a few dollars off our electric bill is nonsense. The main reason people get backup systems is for emergency backup power only when the grid goes down.”

In addition to preventing people with new PV/battery backup systems from connecting to its system, the company is also considering imposing high retroactive charges, as much as $800 for existing systems.  These existing systems have all be approved by the CA PSC and all other government and industry standards.

Customers who own these small systems point out that backup battery systems are not designed to serve as daily power storage systems, constantly cycling down and back up again repeatedly, day after day.  As one homeowner put it, “There is no science to support SCE’s claim.”

Of course, science is not the point.  SCE’s control of the obsolete and dying electrical system is the point.

SCE has made huge investments in a baseload/peak load system that generates big profits from big capital projects as well as speculative opportunities in the peak load markets.

Battery storage is one way of meeting peak demand and eliminating the need for overcapacity in our electrical generating system.  So even if customers were using their own battery banks as SCE claims, to arbitrage peak period prices, this kind of load shaving is a big benefit to the overall system.  But SCE doesn’t like that because it means the company won’t be able to collect high peak load rates from its customers.

So once again, we see an obsolete power company using its political power to prevent innovation and real reliability being rebuilt from the ground up by average people.

We don’t have smart meters and real time pricing in WV yet, but when we do, be prepared for WV’s Ohio-based electricity monopolies to pull this kind of power play on innovative new generators.

2 thoughts on “Power Companies Want to Crush Both Innovation and Reliability

  1. So why can’t the Hewitts just disconnect from the grid and use their system instead? I’m perhaps biased in favor of off-grid systems but to me it seems like the best response to this crap, especially if CA’s PSC goes along with this. Though it’s too bad grid-tied customers can’t contribute to peak power, which is afternoon in CA.

    • Off-grid systems are always an option. They are individual solutions that aren’t solutions to the larger problems of the electrical system as a whole. The important lesson that off-grid systems teach is not independence from the regional grid, but minimizing use to minimize generation investment.

      At a certain point, off-grid systems, if they become dominant in an area, can end up being a less efficient use of both natural and economic resources. A certain measure of shared community technology and capacity provides a much more balanced and sustainable system.

      Off-grid systems are also not immune to interference from the political power of the electricity industry. Property tax penalties and community zoning restrictions could play the same role as the games the industry plays with interconnected producers.

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