Sunday, November 17, 2013

An Already-Lost War

Last week, the Arizona state Corporation Commission allowed our local electric company, Arizona Power Systems, to charge extra to people who have put up solar generating systems on their own land.  Why, you may ask?  Well, APS argued that it had been supporting green-clean solar energy by, if you please, "subsidizing" solar users by buying the extra electricity these folks had generated at home and not used up themselves, but couldn't afford to do that anymore because there are so many solar users in the state nowadays.  Besides, they insisted, everybody uses the electric grid which APS built, and therefore everybody should share in paying for it.  APS originally wanted to charge solar users $100 apiece, per month, for the privilege of dumping their extra electricity into APS' grid.  The Corporation Commission, whose idea of the scales of justice is a pair of coat-pockets, and whichever pocket gets filled heavier wins, generously decided that such a fee would be too high;  APS can charge solar users no more than $5 per month.

Now think about this.  People who put up solar generators on their own land (often on their own roofs) at their own expense, who turn sunlight (very abundant here in Arizona) into electricity, make enough electricity to power their own homes/farms/schools/shops/etc. and more, must pay the electric company for the extra power which those folks put into the state grid.  Uhuh.  This is like saying that anyone who makes his/her own gasoline and can't use it all him/herself must pay Exxon to come haul it away rather than selling it to the oil companies, let alone anyone else.  Rrrrright.

This leaves solar-users three choices:  1) pay the minimal fee and forget about it, 2) get off the grid entirely, cut their ties to APS and tell the company to go scr#w itself, or 3) appeal the ruling in federal court.  Either of those last two tactics will work.

I doubt if anyone else in Arizona knows this particular piece of history, since it happened more than 40 years ago in New York state, but it certainly applies here.  Back in the 1960s, a fairly-famous Anarchist writer named Murray Bookchin lived in a co-op apartment building in New York city.  Being very interested in the ecology movement (IIRC, he wrote one of the entries in the original Whole Earth Catalog), and being something of an electrical engineer himself, he persuaded the other members of his co-op to put up a wind-generator on the roof and use it to power the building.  Their generator worked so well that not only did the whole building have abundant electricity, but it fed power back into the city's power-lines -- thereby making the meters run backwards.  Well, the local electric company wasn't about to take that lying down;  it sent the cops after the tenants for the crime of "cheating" the electric meters.  The NYC government's courts (which were much more sympathetic to their city electric company -- Con Edison -- than to some bunch of radical weirdos) agreed, and charged the tenants ridiculous money.  Murray Bookchin and his buddies didn't give up that easily;  they appealed the case -- in the district federal court.  There they argued that they had provably created their own electricity and didn't owe Con Ed anything.  In fact, by putting the excess electricity into the grid, they had given the city added power -- and if anything, Con Ed owed them for the product.  The judge agreed, overturned the lower court ruling, and ordered Con Ed to pay the tenants for the electricity they had generated (plus court costs) and any further electricity the tenants might pump into their lines in the future.  Con Ed had no choice but to comply.  Of course, the company found ingenious excuses to pay the tenants only pennies, but the point is, they were obliged to pay.  Now remember, this ruling was made in federal court -- which means that the ruling applies in all states and territories of the US.

Yes, that includes Arizona.  Once the solar users of Arizona discover that little fact, they can appeal the Corporation Commission's ruling -- likewise in federal court -- and get it reversed.  APS will then have to pay every solar user in Arizona who generates more electricity than s/he can use and pumps the excess into the grid.  It's federal law!

This is going to cost APS some serious money.  Possibly this is why APS is sucking up as much money from solar users as possible, before they get wise.  Possibly APS is hoping that those solar users will cut themselves off the grid first, so it won't have to pay.

In any case, solar generation is not going to go away.  Neither will wind-generators in less sunny states.  What will happen when all those green-clean generators get together, form a co-op, and become a power company of their own?

--Leslie <;)))><  


Ori Pomerantz said...

One problem with going off the grid(1) is that power storage is difficult and expensive. The best batteries require rare earth elements. Even then there is a loss of energy (

If everybody is producing energy during the day, but still needs it at night, then the power company still needs to spend more to turn the turbines and maintain the grid.

(1) Or telling the power company: "I gave you 100 kWh and I took 100 kWh, so we're even and I don't owe you anything"

Joel Singer said...

It's fair and proper that APS pays for electricity being put into their system, at fair market rates. They have to run their own generating facilities less.

Conversely, it's fair and proper that homeowners pay for the expense of being connected to the electricity grid -- APS has to lay power lines, make sure that each home is connected, fix them when things go wrong. It's like paying for firemen, police, water, sewage.

$100/month, or even $50/month, seems high to me, but such a cost would be easy for an independent expert to calculate. If we could find one.

Peter G said...

Ori is very correct. The power company has to keep the big central plants online during the day even if they produce very little salable power. They can't shut the plants down during the day unless you are talking very expensive to run diesels or gas turbines (NOT co-gen ones, just straight GT).

Washington or Oregon are even having a problem with so much non-conventional and non-predictable generation capacity that their grid is becoming unstable.

Leslie Fish said...

Okay, the power-storage problem is technical, and can be solved with a technical fix. I'm willing to bet that the power companies in Washington and Oregon, at least, are working on the problem even now. Having done it, I know that getting hooked up to the grid costs a very pretty penny -- quite enough to offset whatever the household's "share" of the expense of the grid may be. Once it's in place, I don't see why people who generate power shouldn't be paid for whatever they make and put into the grid -- at fair market price, as Joel said. If the power companies turn out to be the best/most efficient power *storage* business, then they can buy power generated during the day and sell what they put out at night.

Jennifer said...

Unfortunately, federal court doesn't necessarily trump state court.

Courts are bound by the published opinions of the courts above them. A state district court is bound by a state appellate court is bound by a state supreme court. A federal district court is bound by a federal appeals court is bound by the Supreme Court of the United States.

State courts are generally not bound by decisions of the federal court, unless it's a federal issue, and in that case the court is bound by an opinion by the United States Supreme Court only.

To be binding, a decision must have been made by an appellate court to which the matter at hand could be appealed.

Mark Horning said...

A flat fee "grid connection" charge to all users is likely legal.

A flat fee grid connection charge to only those with solar installations strikes me as very questionable.

Ori Pomerantz said...

I flat fee "grid connection" charge, with rebate to customers that spend over a certain amount on electricity, might also be legal.

Ori Pomerantz said...

Peter G pointed me to this page about a technical fix.

Peter G said...

Finally able to get back to this after getting back from overseas and finding the post.

Washington or Oregon is looking at installing large (500 gallon) hot water tanks in homes. The power companies would have a smart meter system that would let them dump electricity by heating the water to 200F or so. Mixing valves of course would be used to bring the hot water in the house down to safe levels.

Good news for consumers is that on windy days it free unlimited hot water. Probably on a lot of days with a bit of personal responsibility and planning you wouldn't have to pay for hot water.

At issue is who is going to pay for the large and special hot water heaters.

For AZ, in my opinion, paying consumers the lowest rate at the time the power is going back into the grid might be a solution. On a hot sunny day when AC is running all over the place the power company Wants that power and will pay for it, and pay quite a bit. At other times they wouldn't pay so much. Technical issue is the need for smart meters to be installed. Also, I think a change to Federal law that requires that small producers get paid at the highest tariff rate that exists.

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