5 ms·

Customers who save on electric bills could be forced to pay utility lost profits

26 points by DocFeind 2y ago

JoeAltmaier 2y ago
Utilities work like that. You don't just have to pay the marginal cost of the electricity you consume. The entire infrastructure has to be supported by the customers (who else is there?) Which doesn't much depend on demand - the wires or pipes or drains or whatever have to be run to every potential consumer, regardless of their need.
- dave4420 2y ago
  That’s what the standing charge is for. Or don’t you have that in the US?
  - JohnFen 2y ago
    We have that in my part of the US, but my utility calls it a "connection fee". It's what you pay just to be connected to the grid, not for the actual electricity you use.
    - lathiat 2y ago
      In Australia/Perth we have a "Daily Supply Charge". We also have one of the higest rates of residential rooftop solar here, you get relatively little payback for exporting in Perth (its hard to get more than about $20/month) but can save quite a bit on what you self-consume during the day. As a result, this Daily Supply Charge has been steadily going up over the last decade, much more than the per-unit fee. Currently it's $1.13 AUD/day + $0.316/kWh (that's 74c USD/day + $0.21 USD/kWh)
      - xbmcuser 2y ago
        Looking at how cheap LFP batteries are getting and people not getting much for feeding back into the grid from their solar installs I think battery pack sales are about to rocket. Australia is in a very unique situation with a lot of land, big potential for solar and wind. https://www.alibaba.com/product-detail/Dawnice-Outdoor-Cabinet-50kw-300kw-100kwh_1601164170041.html?spm=a2700.galleryofferlist.p_offer.d_title.231f360eNNY9Mr&s=p https://www.alibaba.com/product-detail/Dawnice-Outdoor-Cabin...
      - cool_dude85 2y ago
        These charges are quite high compared to most places in the US. I pay somewhere around 11 or 12 cents USD per kWh and around 50 cents per day in a connection fee (in reality, it's 15 per bill and not adjusted for the number of days being billed).
        deleted 2y ago
        [deleted]
      - deleted 2y ago
        [deleted]
- quantified 2y ago
  "Under-earning fees" sound like more than just a connection fee. The non-generation portion of a standard bill should cover that. If the homeowner has surplus, you'd expect that to be sold into the grid at some sort of weak wholesale rate, not the retail rate.
  - JoeAltmaier 2y ago
    The measured rate has some of the overhead in it. That's being revealed by this change. If you don't consume enough to 'pay your share' thru that part of the bill, well, then that bill will have to be increased. Call it what you like; it's paying for infrastructure. The farce of paying for homeowner generation is something activists (whom I love) came up with, not the utility. It's clearly operating directly against the interests of the group, in as much as it is generally paid in 10X what the 'extra' electricity is worth. So, agreed. it should be some weak wholesale rate if it's anything.
    - marcuskane2 2y ago
      > It's clearly operating directly against the interests of the group It's operating against the profit margin of the for-profit utility company. It's operating for the interests of the general public as a group, as distributed residential solar has significant societal benefits for resiliency after natural disasters, lower pollution, etc. The American energy grid is a mess of bad incentives and bad actors, where we get for-profit companies with monopoly control and often their incentives are to lobby politicians for rules and regulations which increase their profits to the detriment of everyone else.
- jrflowers 2y ago
  This makes sense because wires and pipes and drains and whatnot are called “profits”
- dventimi 2y ago
  Utilities do not work like that. They do not all charge for lost revenue.
- IWeldMelons 2y ago
  Of course infrastracture costs depends on demand; you have less wear and tear on transformers, turbines etc. I live in the developing world (ex-USSR) and the government punish higher consumption (higher price), as it causes constant shutdown of tranformers due to overheating.
AtlasBarfed 2y ago
All the more reason to get consumer /residential solar with storage rolled out Utilities have probably gotten very used and to the regulatory capture that they possess, which is quite strong The only real competition against utility power is home solar But at least it's competition
- sidewndr46 2y ago
  At least where I live, you don't own the power you generate via solar. The public utility does. You have to sell it to them at a discounted rate and then buy it back at the full rate.
  - celdon25 2y ago
    Sounds like a great policy if you want to discourage proliferation of solar.
  - idiotsecant 2y ago
    That's not true anywhere unless you're grid tied. In which case if you don't like it why not go off-grid?
    - euroderf 2y ago
      I can see where utilities would get laws passed to require connection to the grid.
    - sidewndr46 2y ago
      It's not legal to have independent generation on your property here. It must be grid tied or interlocked. If it's interlocked, you only are allowed to use it temporarily.
      - mindslight 2y ago
        Are you sure that independent generation is actually illegal itself, and not just constructively discouraged? Where is this, if you don't mind my asking? I've got a similar situation where the public utility will only pay for solar generation under a two meter "buy all sell all" arrangement. From what I've seen people just don't plan on selling anything back to the grid, and the overproducers get storage batteries. (As long as some grid tie is required for occupancy permit, this doesn't really address the original comment's point about bona fide competition with the grid. But on the other hand I'd rather have a public utility than be in a victim market of a "private" underregulated monopoly. My connection fee is like $10/mo. Also they built out gigabit fiber, which just works and doesn't require the yearly threaten to cancel dance of Ma Coax.)
hnburnsy 2y ago
Kind of the same with the gas taxes which EVs avoid. Gas taxes fund road construction.
- scotty79 2y ago
  Why would only motorists pay for roads if everybody benefits from existance of road transport?
  - hnburnsy 2y ago
    > Why would only motorists pay for roads if everybody benefits from existance of road transport? Not sure the history in the US of road construction funding, but my understanding is that taxes on vehicle fuel funds the majority of road construction. States are in acting taxes on EVs to make up for a perceived loss.
    - dghlsakjg 2y ago
      Fuel taxes are a minority of road funding. Taxes, including fuel taxes, directly charged to motorists only make up 53% of the cost of road building and maintenance in the US. Motorists are deeply subsidized by general funds. https://taxfoundation.org/data/all/state/states-road-funding-2019/ https://taxfoundation.org/data/all/state/states-road-funding...
      - hnburnsy 2y ago
        Good info, thx, but states dont want to lose that 40%
  - yurishimo 2y ago
    It should be included in taxes on the vehicles themselves which then gets priced into the product (just like fuel is currently). One major difference between the US and EU for example is road taxes just for owning a car. The US kind of has that with registration, but the costs are too low for all vehicle classes. In the Netherlands, I pay €22/month for my economy car in a road tax that is separate from fuel taxes. If I drive more, then I'll obviously contribute more in fuel taxes. If I had a bigger car, the cost might be €50 or €100/month for a large box truck that causes considerably more wear and tear, even if it doesn't drive as far as I do on my daily commute in the economy car. Registration is included in this cost. If I deregister my vehicle, I stop paying the tax. I feel this is a better/fairer arrangement for all parties.
exe34 2y ago
This makes perfect sense - employers should also pay workers for the lost income due to improved productivity.
- floppiplopp 2y ago
  Alternatively, we could lower our productivity to reflect the income. I'm a true capitalist and will evaluate the use of my resources based on my personal profit. There's literally no incentive for me to work harder or more efficiently if there's no payoff.
  - JumpCrisscross 2y ago
    > no incentive for me to work harder or more efficiently if there's no payoff Yes? You should be noting if more work or productivity isn't compensated (at your firm or elsewhere). That isn't lowering productivity, it's allocating your time and energy efficiently.
deleted 2y ago
[deleted]
foxyv 2y ago
I think this is a great opportunity for Louisiana to socialize their power grid. The same thing happened in California. For profit energy providers raise rates when usage is high, and then raise rates when usage is low. The result is that people just trying to survive are getting power shutoff because they can't afford to even run their refrigerator, much less A/C or heating.

26 points by DocFeind 2y ago

Utilities work like that. You don't just have to pay the marginal cost of the electricity you consume. The entire infrastructure has to be supported by the customers (who else is there?) Which doesn't much depend on demand - the wires or pipes or drains or whatever have to be run to every potential consumer, regardless of their need.

dave4420 2y ago
That’s what the standing charge is for. Or don’t you have that in the US?
- JohnFen 2y ago
  We have that in my part of the US, but my utility calls it a "connection fee". It's what you pay just to be connected to the grid, not for the actual electricity you use.
  - lathiat 2y ago
    In Australia/Perth we have a "Daily Supply Charge". We also have one of the higest rates of residential rooftop solar here, you get relatively little payback for exporting in Perth (its hard to get more than about $20/month) but can save quite a bit on what you self-consume during the day. As a result, this Daily Supply Charge has been steadily going up over the last decade, much more than the per-unit fee. Currently it's $1.13 AUD/day + $0.316/kWh (that's 74c USD/day + $0.21 USD/kWh)
    - xbmcuser 2y ago
      Looking at how cheap LFP batteries are getting and people not getting much for feeding back into the grid from their solar installs I think battery pack sales are about to rocket. Australia is in a very unique situation with a lot of land, big potential for solar and wind. https://www.alibaba.com/product-detail/Dawnice-Outdoor-Cabinet-50kw-300kw-100kwh_1601164170041.html?spm=a2700.galleryofferlist.p_offer.d_title.231f360eNNY9Mr&s=p https://www.alibaba.com/product-detail/Dawnice-Outdoor-Cabin...
    - cool_dude85 2y ago
      These charges are quite high compared to most places in the US. I pay somewhere around 11 or 12 cents USD per kWh and around 50 cents per day in a connection fee (in reality, it's 15 per bill and not adjusted for the number of days being billed).
      - deleted 2y ago
        [deleted]
    - deleted 2y ago
      [deleted]
quantified 2y ago
"Under-earning fees" sound like more than just a connection fee. The non-generation portion of a standard bill should cover that. If the homeowner has surplus, you'd expect that to be sold into the grid at some sort of weak wholesale rate, not the retail rate.
- JoeAltmaier 2y ago
  The measured rate has some of the overhead in it. That's being revealed by this change. If you don't consume enough to 'pay your share' thru that part of the bill, well, then that bill will have to be increased. Call it what you like; it's paying for infrastructure. The farce of paying for homeowner generation is something activists (whom I love) came up with, not the utility. It's clearly operating directly against the interests of the group, in as much as it is generally paid in 10X what the 'extra' electricity is worth. So, agreed. it should be some weak wholesale rate if it's anything.
  - marcuskane2 2y ago
    > It's clearly operating directly against the interests of the group It's operating against the profit margin of the for-profit utility company. It's operating for the interests of the general public as a group, as distributed residential solar has significant societal benefits for resiliency after natural disasters, lower pollution, etc. The American energy grid is a mess of bad incentives and bad actors, where we get for-profit companies with monopoly control and often their incentives are to lobby politicians for rules and regulations which increase their profits to the detriment of everyone else.
jrflowers 2y ago
This makes sense because wires and pipes and drains and whatnot are called “profits”
dventimi 2y ago
Utilities do not work like that. They do not all charge for lost revenue.
IWeldMelons 2y ago
Of course infrastracture costs depends on demand; you have less wear and tear on transformers, turbines etc. I live in the developing world (ex-USSR) and the government punish higher consumption (higher price), as it causes constant shutdown of tranformers due to overheating.

AtlasBarfed 2y ago

All the more reason to get consumer /residential solar with storage rolled out Utilities have probably gotten very used and to the regulatory capture that they possess, which is quite strong The only real competition against utility power is home solar But at least it's competition

sidewndr46 2y ago
At least where I live, you don't own the power you generate via solar. The public utility does. You have to sell it to them at a discounted rate and then buy it back at the full rate.
- celdon25 2y ago
  Sounds like a great policy if you want to discourage proliferation of solar.
- idiotsecant 2y ago
  That's not true anywhere unless you're grid tied. In which case if you don't like it why not go off-grid?
  - euroderf 2y ago
    I can see where utilities would get laws passed to require connection to the grid.
  - sidewndr46 2y ago
    It's not legal to have independent generation on your property here. It must be grid tied or interlocked. If it's interlocked, you only are allowed to use it temporarily.
    - mindslight 2y ago
      Are you sure that independent generation is actually illegal itself, and not just constructively discouraged? Where is this, if you don't mind my asking? I've got a similar situation where the public utility will only pay for solar generation under a two meter "buy all sell all" arrangement. From what I've seen people just don't plan on selling anything back to the grid, and the overproducers get storage batteries. (As long as some grid tie is required for occupancy permit, this doesn't really address the original comment's point about bona fide competition with the grid. But on the other hand I'd rather have a public utility than be in a victim market of a "private" underregulated monopoly. My connection fee is like $10/mo. Also they built out gigabit fiber, which just works and doesn't require the yearly threaten to cancel dance of Ma Coax.)

hnburnsy 2y ago

Kind of the same with the gas taxes which EVs avoid. Gas taxes fund road construction.

scotty79 2y ago
Why would only motorists pay for roads if everybody benefits from existance of road transport?
- hnburnsy 2y ago
  > Why would only motorists pay for roads if everybody benefits from existance of road transport? Not sure the history in the US of road construction funding, but my understanding is that taxes on vehicle fuel funds the majority of road construction. States are in acting taxes on EVs to make up for a perceived loss.
  - dghlsakjg 2y ago
    Fuel taxes are a minority of road funding. Taxes, including fuel taxes, directly charged to motorists only make up 53% of the cost of road building and maintenance in the US. Motorists are deeply subsidized by general funds. https://taxfoundation.org/data/all/state/states-road-funding-2019/ https://taxfoundation.org/data/all/state/states-road-funding...
    - hnburnsy 2y ago
      Good info, thx, but states dont want to lose that 40%
- yurishimo 2y ago
  It should be included in taxes on the vehicles themselves which then gets priced into the product (just like fuel is currently). One major difference between the US and EU for example is road taxes just for owning a car. The US kind of has that with registration, but the costs are too low for all vehicle classes. In the Netherlands, I pay €22/month for my economy car in a road tax that is separate from fuel taxes. If I drive more, then I'll obviously contribute more in fuel taxes. If I had a bigger car, the cost might be €50 or €100/month for a large box truck that causes considerably more wear and tear, even if it doesn't drive as far as I do on my daily commute in the economy car. Registration is included in this cost. If I deregister my vehicle, I stop paying the tax. I feel this is a better/fairer arrangement for all parties.

exe34 2y ago

This makes perfect sense - employers should also pay workers for the lost income due to improved productivity.

floppiplopp 2y ago
Alternatively, we could lower our productivity to reflect the income. I'm a true capitalist and will evaluate the use of my resources based on my personal profit. There's literally no incentive for me to work harder or more efficiently if there's no payoff.
- JumpCrisscross 2y ago
  > no incentive for me to work harder or more efficiently if there's no payoff Yes? You should be noting if more work or productivity isn't compensated (at your firm or elsewhere). That isn't lowering productivity, it's allocating your time and energy efficiently.

deleted 2y ago

[deleted]

foxyv 2y ago

I think this is a great opportunity for Louisiana to socialize their power grid. The same thing happened in California. For profit energy providers raise rates when usage is high, and then raise rates when usage is low. The result is that people just trying to survive are getting power shutoff because they can't afford to even run their refrigerator, much less A/C or heating.