Large utility companies (AKA dirty oil and gas) have been in control of your energy for far too long. However, in the last 20 years, renewable energy has been on the rise dramatically, and it’s beginning to worry the major players in energy. But are utility companies against solar power? Here’s one way to tell. Utility companies are starting to fight back against renewable energy policies. Including keeping solar energy under their power, instead of yours.
Dirty utility company games
Utility companies are getting tricky when it comes to solar energy. They’ve successfully stayed in control this far by playing a strong (but dirty) game. The truth is, they’re not the only ones holding cards, and you could start to take control of your home’s energy by knowing how to play the game right.
Want to know more? Let’s discuss the tactics the utility companies are using, how these dirty secrets can cost you more money and how you can overcome them. Then we’ll reveal what you can do as a homeowner to regain control of your home’s energy and your money.
First, here’s a bit of background on the situation.
Background: the politics of net metering
Net metering is one of the benefits of solar energy that utility companies really seem to hate. Probably because they have to pay you (solar customers) for the energy that you produce, thereby offsetting your monthly electric bills. Regardless of why, they have been fighting against it for a long time. And in some states they’ve succeeded in getting net metering policies wiped out (like Louisiana) and in other states they’re still trying (like California).
Secrets the utility companies don’t want you to know
Now that we understand a little more about the landscape of this issue, let’s take a look at all the ways the utility companies are trying to win this game.
Utility Company Strategy #1: Time of use billing
Time of use (TOU) billing means you’ll pay more for electricity used during peak hours than during non-peak hours.
Under TOU billing, you’ll want your solar panels to create the most amount of energy in the late afternoon/early evening. However, most solar panel systems are set up to capture the most amount of energy during mid-day.
Want to know how to calculate your peak sunshine hours? Read more.
What you can do:
Even if your solar panel system is set up to soak in all that midday sun, you can still generate energy for use during peak times that are typically during evening instead of midday. This is easily done by adding a solar battery backup to your system, which means you’ll store all that midday excess energy and strategically use it during peak hours when your electric company is charging you the most for energy drawn from the grid.
Another thing to note is that you also may be able to offset TOU billing with the direction your solar panels face. You’ll want to talk to a Solar Energy Specialist about this option.
Utility Company Strategy #2: Non-bypassable charges
Non-bypassable charges are exactly what they sound like: charges that cannot be avoided on your electric bill. So despite the fact that solar customers are feeding energy into the grid, these micro-charges will not be credited, therefore landing on your monthly electric bill. Some net metering plans, like California’s NEM 2.0, states that solar customers also have to pay for these charges. Passing along these charges to solar customers even though they are generating electricity for the grid, was of course fought for by the utility companies when these net metering plans were proposed and approved.
What you can do:
Non-bypassable charges are unavoidable. However, the good news is that they are very often fractions of a cent each bill and go to public programs for assistance, management and decommissioning. This means these charges are nothing to worry about too much, especially when you hear rumors about unavoidable charges on your electric bill even after you go solar. It’s just another scare tactic the utility companies are using in the battle against renewable energy. The amount you’ll save in solar energy production will far exceed these minute charges.
Utility Company Strategy #3: Demand Charges
Here are more charges similar to TOU billing in which the utility companies get to bill customers more for electricity according to the highest peak energy production for your home. This means that if you use a lot of energy during one time of day, you’re going to end up paying more for electricity a month than other customers.
What you can do:
Make sure to monitor your daily and monthly energy usage and notice any peak times your home is using a lot of energy at once. You can also be mindful about energy efficiency and minimize running major appliances at the same time. For example, running laundry at night when the air conditioner is down during the summer, or during the day when the heater is off. If you have solar panels, you can also consider running electricity-draining appliances during peak sunshine times like midday.
Utility Company Strategy #4: Grid-Access Charges and Monthly Minimums
These are sneaky charges that utility companies implemented specifically for solar customers. In order for your solar system to have access to the utility company’s grid, they are going to charge you a grid-access charge. This is part of your state’s net metering plan and includes the payback rate for the solar energy fed back into the grid. These charges depend on your state and the size of your system. It’s often not a lot, but it’s yet another trick utility companies use to make solar seem less appealing.
For some states and utility companies, you would still have a monthly minimum bill even if you produced enough solar energy to cover all your home’s consumption.
What you can do:
The good news, again, is that the amount of energy you’ll be feeding back into the grid will surpass these charges, so you shouldn’t need to worry about them either. In fact, depending on the size of your system, you could be producing so much excess energy that your account goes in the negative, which means you could be paying that monthly minimum with your credit account. It’s still sneaky nonetheless, and decreases the amount of money you’ll save, but the amount you’ll be saving, as well as detaching yourself from these sneaky companies will be well worth it.
How you can take your power back
We’ve already mentioned a few things you can do to manage your home’s power instead of the electric company. But let’s take a look at all the ways you can keep control of your energy and your money.
Level up with energy efficiency upgrades
Another pro move is to give your home a load of energy efficiency upgrades. Things like sealing air ducts, gaps and cracks, and making sure your house is properly insulated. This will make your home use the least amount of energy possible and as a result save a lot of money on electricity. In fact, did you know? If you added up all the leaks, holes, and gaps in an average home, it would be the same as having a window wide open every day.
Install smart home products
Another thing you can do is to switch to smart products that help you monitor and regulate your home energy usage. This can be done by switching to a Google Nest Thermostat that learns your schedule and programs itself to save your home’s energy and money. You can also program a smart thermostat around any TOU billing rates your energy company has in place.
When all else fails, fight back
One of the most important things you can do is to keep an eye on legislation in your state about renewable energy. Utility companies are constantly fighting against policies that make switching to renewable energy more difficult for homeowners like you. Even if your state has an aggressive renewable energy policy, watch out for those utility companies who want to also control renewable energy in addition to their old dirty energy. We want to keep solar energy in the hands of homeowners!
Power your home with the sun instead
We’ve already mentioned how going solar can keep you in control of your home’s energy, as well as all the ways the utility companies are trying to control net metering. But even though they’re trying to get involved in the politics of net metering, getting a solar panel system installed on your home is truly the single most powerful way to take control of your own energy. There are a few things you can do to gain even more independence from your utility company once you have solar too.
One of these things is to consider the direction your solar panels will be facing. Our trained Solar Energy Specialists will be able to help you understand how this can make a huge difference in the amount of energy your panels will produce on a daily basis. They’ll also factor in things like peak sunlight hours and any TOU billing times your energy company uses.
Produce and store your own energy with solar panels + battery backup
The next level up from having a home solar system is by adding on a solar battery storage, like the Enphase Encharge or Tesla Powerwall. By adding a solar battery backup, you can eliminate demand charges, not worry about TOU billing, and store your energy for later use instead of sending it back to the grid with net metering.
And with solar panel batteries like Enphase Encharge, you can monitor and control your home energy usage right from your phone or computer. There are even built-in settings to optimize for things like TOU billing.
What’s next: the future of electricity
- Electricity prices are on the rise. It’s no surprise electricity rates have been steadily going up over the last several years. But what you might not know is exactly how much. Electricity prices have increased 1.8% per year in the United States for the past 25 years, says data from the U.S. Energy Information Administration (EIA). In 1994, the national average price was 8.38 cents per kilowatt-hour (kWh) and now the national average price is 13.90 cents/kWh.
- In the U.S. alone, there are a ton of state renewable energy portfolios (like in Illinois) that promise a certain amount of renewable energy percentage by 2050. This means now is the time to switch to renewable energy while the incentives are out there for homeowners. Because in the future, it may become mandatory instead of just a great idea. For example, this has already happened in California, where solar panel installations are required for new home builds.
- The utility companies know this and are trying to hoard the renewable energy movement for themselves. A lot of major utility companies against solar power have already jumped on the solar energy bandwagon. This means that they can charge you for the solar energy they produce in the future— wouldn’t you rather it be the other way around?
Fed up with the dirty games of the utility companies? Schedule your free solar consultation and find out how you can take more control of your energy.