Chastened yet, Public Utilities Commission?

Consumers oppose SDG&E plan that would thwart solar

At a packed public hearing at Al Bahr Shrine Center in Kearny Mesa this afternoon (Sept. 16), utility ratepayers showed up to slam or support San Diego Gas & Electric's (SDG&E's) plan to raise rates of low residential electric users and lower rates of large users — generally, a blow for poorer people and a boost for richer ones.

The meeting, called by the California Public Utilities Commission (CPUC), was held in a small room, and about 100 people attended, according to Pete Hasapopoulos, who was there representing the Sierra Club, which opposes the proposal.

Hasapopoulos says about 80 percent of the people opposed SDG&E's plan to boost its profits, and applause was generally louder when generated by opponents. However, he says, there were people now paying high electric rates who spoke in favor of the SDG&E proposal. They want their bills reduced. Also, chambers of commerce from Escondido, National City, and Vista were there to support the utility, as were some nonprofits that get donations from the company. Representatives of the solar energy industry, as well as groups such as the Sierra Club, were there to oppose the measure.

The proposal, if enacted, is certain to harm households that have installed rooftop solar or are taking moves to cut down utility usage sharply.

Utilities fatten their bottom lines by building facilities that often use fossil fuels, such as coal or gas. Utilities estimate how much they will charge customers to finance these mostly-polluting power plants, and go to the CPUC, asking for a high rate of return. They normally get it. The more infrastructure the utilities build, the more their profits. But rooftop solar interferes with this source of profits. The utilities get less revenue, and because of California's net metering arrangement, household meters run backward when the sun is shining, providing power to the grid.

Yesterday, the CPUC got a serious setback, as emails between the regulator and Pacific Gas & Electric (PG&E) showed that the commission has been blatantly favoring PG&E as the Bay Area utility fights to pay a lower penalty for its role in the 2010 San Bruno pipeline explosion that killed eight people. The CPUC's chief of staff resigned and Michael Peevey, the president, recused himself from the PG&E hearings. PG&E fired three officials. As a result, the agency might not be so bold in pressing for still another measure that will fatten utility profits. On the other hand, it's possible the CPUC hasn't been chastened.

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Dennis Faulkner: Nuclear plants and solar farms from which the utilities bring electricity to metro areas are less polluting and are also in use. Still, the fossil fuels dominate. You are correct: anything that slows down progress of rooftop solar should be ashcanned. But the utility lobby is very strong in the legislature, and as we have vividly seen of late, the utilities control the CPUC. Best, Don Bauder

Guess the ROI on my roof top solar ain't going to pencil out as predicted... Figures now that I just had it installed in July.

JustWondering: If SDG&E and the two other publicly-held utilities, Southern California Edison and Pacific Gas & Electric, succeed in this initiative, yes, your return on investment may be disappointing. That is why it is so important to fight this attempted rape of the ratepayer. Best, Don Bauder

don bauder let me ask you a question. If you have installed a solar pv system, which I have, on all of my properties both personal residences and rental properties, and you haven't, both your ROI and your rate of return are mainly dependent on how much you are charged for electricity. and how much you use. I understand there are a few other variables involved, but basically the higher usage rate, the faster the return and the lower the rate, the slower the return on the same amount of usage. For example, the system I installed in Seattle will take longer to return than an identical system in San Clemente and a system in Tucson will return at a rate somewhere between the two. So my question is this. If my ratse go up in San Clemente, where I am serviced by SDG&E, how will my return be disappointing? I will be saving more because of the rate increase. Isn't that part of the reason for installing the system in the first place? Not just to save money now, but as a hedge against higher utility rates in the future, be that future a few years from now or even just a few months from now. That hedge is part of virtually every pitch every solar company makes. Seems to me that unless justwondering is one of those "large" users, his rate will go up not down and though he WILL be paying more for those kw hours that are used, he will be saving money because of NOT paying more for ALL of his electrical usage that he gets from his solar pv system.

danfogel: You are well equipped with rooftop solar. Good for you. That should mean that you are a low user of electricity. If SDG&E, PG&E and Edison get away with what they are proposing, your rates will rise as a low user. Your next door neighbor, who has no solar, is probably a big user who will enjoy a cut in rates.

This is just one way in which utilities are trying to thwart rooftop solar. As of last year, solar was only 3 percent of California's usage. Best, Don Bauder

All true, but that wasn't my question, which was if my rates go up, how will my ROI be disappointing since my savings will be higher? Also, I may indeed be classified as a "small" user, but how would my neighbor, assuming you are speaking in general terms, not specific ones, necessarily be a "big" user, rather than an "average" one. My understanding is that classification would be based on usage, no by comparing to your neighbor. BTW, my house in SC began it's life as a little 1950's bungalow style home, 2 br/1b, of about 600sq ft. My wife and I bought it from the kids of the original owners about 20 yr ago. Right after we bought it we put on a huge addition, about 150 sq ft. Last year, when I decided to stay there and get rid of the big house in Calabasas, I did a major reno, including adding more space. My house is now a 3br 3 1/2b and totaling nearly 1100sq ft. I mean it's absolutely HUGE. LOL! FYI most of the homes in my neighbor hood were built in the 50s-60s and are around 1000-1200 sq ft. I wonder, how big is yours, in terms of sq ft?

danfogel: If your rates go up, your ROI will go down -- not your ROI on your solar investment alone, but your ROI on all your energy needs. I assume solar doesn't permit you to go off the grid. Our house is 4100 square feet. When we had two boys, five cats, and two dogs in San Diego, we had a 2600 square feet home. Now that it's just the two of us, we are at 4100. Best, Don Bauder

don bauder, that's interesting. First off, I just revisited your description of your property in Co. and all I can say is VERY cool. If someone asked me to describe the perfect place for me to retire to, yours description is better than anything I could come up with. Other than adding a large workshop, cos I have lots and lots of tools and love to tinker and maybe a green house, so I could grow a salsa/spaghetti garden in the winter, and you have what I would say is a perfect situation. I'm not envious of many people, but I have to make an exception in this case. I might go for a smaller house, but that's it. When I decided not to move back to SD, I was going to go back to the house in Calabasas. It's just over 3000 sq ft on just under 6 acres. It's pretty nice, but too big. It was marginally too big when it was my wife, my daughter and I, but without my wife and with my daughter happily ensconced in Seattle, I decided it was just too big and too quiet, so I sold it and settled in in SC. And even there at 1100 sq ft, it's more than I need, but it's where I call home even though I spend time in a couple of other places.

Every time we the people try to conserve be it electricity or gas the purveyors of those products always find a way to offset any savings and enhance their bottom line. If all your electric usage is within the lowest tier it means that you probably have a small place and do everything you can to conserve. This is your reward. The CPUC is watching out for you.

AlexClarke: The CPUC hasn't acted on this proposal yet. But you can bet that it favors it -- it favors anything that jacks up utility profits at the expense of ratepayers. Best, Don Bauder

Shotgun Shela: Keep spreading the word. Best, Don Bauder

"These regulated monopolies [investor owned utilities] enjoy the same protection given to the telephone system prior to the 1970s, when rotary-dial phones came only in black, were owned by the monopoly and were rented to consumers who had no other option. Utilities hold a similar and largely unchallenged control over electricity. . ." This quote is from An Electric Revolution by the Galvin Electricity Initiative, which was founded by former Motorola CEO Robert Galvin.

We don't have a choice in San Diego. We have a monopoly that won't relinquish its 19th century centralized power distribution model and wants us to live in the past with them. This is why the City of San Diego is overseeing a feasibility study of Community Choice Energy (aka Aggregation). With Community Choice here is what you get:

1) More renewables at competitive rates. Community Choice providers, such as the two already at work in California, offer their customers much more clean energy than the monopoly. In Sonoma County (www.sonomacleanpower.org) customers can choose 33% or 100% clean energy plans. In Marin County (www.mcecleanenergy.com) customers can choose 50% or 100% plans. In both places the rates for residential and business customers are either beating PG&E outright or are highly competitive.

2) Local control. With Community Choice a board of directors from our participating local governments would set rates for customers in public meetings using a process that encourages public participation and values transparency.

3) Local reinvestment. Millions of dollars leave San Diego County each year to pay for electric generation. Not with Community Choice. Over time, a Community Choice provider would buy increasing amounts of power from local sources, such as rooftop solar, while serving as a catalyst for local job creation.

SDG&E fears Community Choice so much that they recently backed a bill (AB 2145) that would have prevented us from launching it here had it not died in the state senate. If you want more fossil fuel power plants, like the ones SDG&E wants to build in Otay Mesa and Carlsbad at a cost of over $4 billion to electricity customers, more greenhouse gases, and more air pollution, keep living in the past with SDG&E.

It you would like to have the control over our energy destiny that Community Choice delivers please join Friends of San Diego Clean Energy, a partnership of Sierra Club, SD350.org, and the California Solar Energy Industries Association (the wonderful businesses putting solar on our rooftops). You can reach me at [email protected]

PeteHasapopoulos: This is good additional information. Best, Don Bauder

Dan Fogel, I have had solar on my roof for over 8 years and have had an excess generation each year. I'm still stuck with a connection fee of $5/month but now SDGE wants to double the charge for the connection fee. This does have an effect on my ROI. If I am generating an excess I should be able to get my annual fee to zero.

Dennis: Yes, an increase in the connection fee would lower your ROI on solar, other things being equal. Best, Don Bauder

dennis, obviously that would. I deal with both SDG&E and SCE, so I am right their with you. However, that is one of the other variables involved that I mentioned in my original comment. When I said rate increases, I was referring to what don bauder was saying about residential rate increases and the rate base growth expectations for new facilities. As he said, with all other things being equal, an increase in the connection fee would lower your ROI on solar. What I was referring to was that an increase in rates alone, across the board and not just for solar users, would not reduce your roi. Even with that $5.00 increase, for someone with $100 in usage per month, even just a 10% increase in rates would mean your roi increases. After last years increase, my usage was about $15-18 more per month. Even with a $5 connect fee increase, I'm still saving money. . BTW, if you think $5 is bad, you should check out what APS wants to do in Az. They want to add a surcharge for grid connected solar users, to the tune for as much as $50 per month, to offset wear and tear on their grid infrastructure.

danfogel: One could argue cogently that an increase in rates alone would not reduce your strictly-solar ROI. But it would reduce your ROI on energy, and it would make solar less attractive financially.

That proposed move in Arizona is horrible. Best, Don Bauder

Danfogel, What's happening in AZ is my real concern.

Dennis: It should be a real concern for everybody; every time a utility anywhere gets away with murder, other distant utilities should get nervous. The entire utility industry is fighting solar, and they are doing it collectively. Best, Don Bauder

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