4 ms·

The world's dumbest idea: Taxing solar energy

42 points by kordless 13y ago

thedrbrian 13y ago
will specifically target those who install power generation systems on their property and sell the excess energy back to the grid. Misleading title. They want to tax people who want to sell the solar energy back into the grid , since joe six pack has to rely on other people's equipment to transmit the energy he captured on his roof. Also there is the issue of joe synchronising his output with whatever is coming down the line from the normal generators. Maybe it shouldn't be a tax, maybe a fee paid to whoever owns the power infrastructure.
- kordless 13y ago
  Given you don't generate as much power as you consume, it is an inevitable outcome for most solar installs to be connected to the power grid. The cost of installing a solar array to meet all energy usage, especially in the Summer in Oklahoma, is significant. It gets crazy hot there. I was just complaining to my wife not 30 minutes ago about how it's cold here in Moraga today. Sometimes I miss the Oklahoma heat, but that's about it.
- revelation 13y ago
  Joe Six Pack already pays a basic charge for his access to the grid. The issue seems to be that PoCos have decided to mix all the infrastructure costs into the variable price of the energy you consume. When your solar power makes you a net producer of energy, that scheme no longer works. But I don't see why we have to institute a new tax to fix their broken pricing model.
  - AnthonyMouse 13y ago
    The problem is the more accurate pricing model won't make people happy. Distribution costs are largely fixed. It matters more how far your house is from the substation, and what the population density is, than how thick the wire is or how many KWh are pushed through it. Including the distribution costs in the price per KWh is a form of price discrimination -- people who need more energy (which implies "need energy more" or "are price insensitive") pay more for distribution than others. It makes those people unhappy, but those people are a minority without the will or political influence necessary to change it. Charging a fixed cost for distribution would reduce prices for high energy users and raise prices for low energy users. The low energy users are, in general, the most price sensitive. They would become very irate and try to exert political pressure on the power company. Of course, that doesn't mean we should let them. But it isn't the power company who causes this; the power company is just responding to politics and the market.
- timthorn 13y ago
  Synchronising isn't really an issue. You need to do a dc-ac conversion in any case, so you take the incoming mains feed and make that the reference for the ac modulator.
  - pdonis 13y ago
    I don't think it's the synchronizing that's an issue; it's the fact that power is now flowing from your house into the grid, instead of the other way around. Since there is no storage in the grid, power in has to balance power out at every point in the grid, which means the grid has to be able to manage its own power generation, in real time, to adjust it according to how much is being put back in by homeowners. The grid as it currently exists is not really designed to do that.
    - timthorn 13y ago
      It's true that the grid has to balance its own generation, but that happens today - the frequency of the mains changes constantly, and it's the grid controllers' job to bring on supply as required. There are some storage options - pumped hydro for example - but I absolutely take your point that the grid is designed for a classically understood demand/supply environment. Certainly there is a risk that all these intermittent renewables will end up causing the most dirty of generators to be spun up more often, in the least efficient usage pattern. The dream has to be a proper demand response system, with electric cars being a key sink for excess generation. The work of David MacKay at Cambridge University is excellent on this topic: http://www.withouthotair.com/ http://www.withouthotair.com/
      - pdonis 13y ago
        the grid has to balance its own generation, but that happens today Yes, but today (i.e., without individual homeowners putting power back into the grid) the grid's control system can assume that the load is always positive except at a finite and fairly small number of known points, the grid's generators, which are controlled by the grid itself. When individual users can put power back into the grid, the load can become negative at any arbitrary location in the grid, without warning. That greatly complicates the control problem. The dream has to be a proper demand response system, with electric cars being a key sink for excess generation. Yes, and who's going to pay for that? (Not the electric cars, but the improvements in the grid that allow it to make use of them as storage.) An obvious solution is to charge the people who are creating the problem by making their connection with the grid two-way instead of one-way.
angrybits 13y ago
for the curious, here's the bill itself: http://webserver1.lsb.state.ok.us/cf_pdf/2013-14%20ENR/SB/SB1456%20ENR.PDF http://webserver1.lsb.state.ok.us/cf_pdf/2013-14%20ENR/SB/SB...
- kordless 13y ago
  I'm hesitating to say collusion is involved, but given the brevity of the act and speed by which this is being passed, it's probably not far off the mark. Also, 'emergency' purposes isn't even defined.
nhebb 13y ago
Based on the issues Hawaii has had, this may not be as stupid as the Yahoo writer makes it sound: http://www.scientificamerican.com/article/a-solar-boom-so-successfull-its-been-halted/ http://www.scientificamerican.com/article/a-solar-boom-so-su...
- revelation 13y ago
  A quick cursory glance on how Hawaii does energy seems to show some rather more important issues than stifling solar growth: http://www.eia.gov/state/?sid=HI#tabs-4 http://www.eia.gov/state/?sid=HI#tabs-4
bowlofpetunias 13y ago
Selling power back to the grid is a rapidly growing home industry which, like any other, should be taxed and regulated. (Emphasis on "like any other", since libertarians will undoubtedly be against the whole principle.) If you produce something and systematically sell it for profit it's perfectly normal. It's not your kids' lemonade stand or a garage sale we're talking about here. The challenge is to do it in such a way that still stimulates the practice, not punish it. Simply calling any form of taxation "dumb" is not constructive. Also, it's not just the simple "Jimmy has a solar panel on his roof" scenario we're talking about here. Collective solar energy initiatives on residential properties are becoming a real industry.
- raldi 13y ago
  Your first sentence needs an addendum starting with "because..."
  - chc 13y ago
    I think that's how the second sentence is meant to function. It should be taxed like any other business because it is substantially like a normal business transaction.
- kordless 13y ago
  Keep in mind that it's not a charge for selling power back, it's a charge for connecting it to the power grid. Not everyone running solar sells back to the grid.
- thaumasiotes 13y ago
  I'm extremely intrigued by the co-occurrence within a span of 3-4 sentences of > Selling power back to the grid is a rapidly growing home industry which, like any other, should be taxed and regulated. (Emphasis on "like any other" with > It's not your kids' lemonade stand or a garage sale we're talking about here. I believe close to 100% of lemonade stands and garage sales both completely ignore local regulations (in fact, every so often you read about the police red-facedly shutting down a lemonade stand) and hide all their income for tax purposes. Can you elaborate on why this is a bad thing?
wglb 13y ago
The core of the issue is will specifically target those who install power generation systems on their property and sell the excess energy back to the grid One of the incentives for doing your own power generation is that in most cases utilities are required to buy back the power under the Net Metering deal. This is a good thing, in general, but there are some engineering issues. When this was invented, I don't know if anyone involved did the calculation of "what if we have tens of thousands of houses generating enough backflow to rival the amount generated by the rest of our system?" The movement has been so successful that now we can see the possibility that on a very sunny day or windy day or both that these local generation sites are generating enough power that there isn't any where to put it. Voltages rise, breakers trip, sectors go dark. If you are a utility company, you likely have several energy sources at your disposal: hydroelectric, coal-fired plants, nuclear. For each of these sources, you have at your disposal a knob, generally sitting at 5 or 6 that you can turn down a notch to move the water past the generators and down the stream, turn off a couple of burners in the coal fired plant, or move the quenching rods in a little further to reduce the output of your nuke plant. If you have a tens of thousand of home pushing energy back up what used to be exclusively the down pipe. There isn't any centrally-located control knob for that. Certainly part of the reluctance of the utilities is a resistance to the new ways of the world, but it would be imprudent to discount the engineering issues that this is exposing. Yes, the utilities, who are not known for large amounts of imagination, should have been ahead of this and embraced this. But here we are. So in light of that, if taxation slows this unsustainable growth in home solar installations pushing current up the down pipe, perhaps it is not all that bad as the article makes it sound.
madospace 13y ago
How about tax on Angel investment ? yea it happens in India - http://www.nextbigwhat.com/funding-startups-could-be-classified-as-income-budget-2012-297/ http://www.nextbigwhat.com/funding-startups-could-be-classif...

42 points by kordless 13y ago

will specifically target those who install power generation systems on their property and sell the excess energy back to the grid. Misleading title. They want to tax people who want to sell the solar energy back into the grid , since joe six pack has to rely on other people's equipment to transmit the energy he captured on his roof. Also there is the issue of joe synchronising his output with whatever is coming down the line from the normal generators. Maybe it shouldn't be a tax, maybe a fee paid to whoever owns the power infrastructure.

kordless 13y ago
Given you don't generate as much power as you consume, it is an inevitable outcome for most solar installs to be connected to the power grid. The cost of installing a solar array to meet all energy usage, especially in the Summer in Oklahoma, is significant. It gets crazy hot there. I was just complaining to my wife not 30 minutes ago about how it's cold here in Moraga today. Sometimes I miss the Oklahoma heat, but that's about it.
revelation 13y ago
Joe Six Pack already pays a basic charge for his access to the grid. The issue seems to be that PoCos have decided to mix all the infrastructure costs into the variable price of the energy you consume. When your solar power makes you a net producer of energy, that scheme no longer works. But I don't see why we have to institute a new tax to fix their broken pricing model.
- AnthonyMouse 13y ago
  The problem is the more accurate pricing model won't make people happy. Distribution costs are largely fixed. It matters more how far your house is from the substation, and what the population density is, than how thick the wire is or how many KWh are pushed through it. Including the distribution costs in the price per KWh is a form of price discrimination -- people who need more energy (which implies "need energy more" or "are price insensitive") pay more for distribution than others. It makes those people unhappy, but those people are a minority without the will or political influence necessary to change it. Charging a fixed cost for distribution would reduce prices for high energy users and raise prices for low energy users. The low energy users are, in general, the most price sensitive. They would become very irate and try to exert political pressure on the power company. Of course, that doesn't mean we should let them. But it isn't the power company who causes this; the power company is just responding to politics and the market.
timthorn 13y ago
Synchronising isn't really an issue. You need to do a dc-ac conversion in any case, so you take the incoming mains feed and make that the reference for the ac modulator.
- pdonis 13y ago
  I don't think it's the synchronizing that's an issue; it's the fact that power is now flowing from your house into the grid, instead of the other way around. Since there is no storage in the grid, power in has to balance power out at every point in the grid, which means the grid has to be able to manage its own power generation, in real time, to adjust it according to how much is being put back in by homeowners. The grid as it currently exists is not really designed to do that.
  - timthorn 13y ago
    It's true that the grid has to balance its own generation, but that happens today - the frequency of the mains changes constantly, and it's the grid controllers' job to bring on supply as required. There are some storage options - pumped hydro for example - but I absolutely take your point that the grid is designed for a classically understood demand/supply environment. Certainly there is a risk that all these intermittent renewables will end up causing the most dirty of generators to be spun up more often, in the least efficient usage pattern. The dream has to be a proper demand response system, with electric cars being a key sink for excess generation. The work of David MacKay at Cambridge University is excellent on this topic: http://www.withouthotair.com/ http://www.withouthotair.com/
    - pdonis 13y ago
      the grid has to balance its own generation, but that happens today Yes, but today (i.e., without individual homeowners putting power back into the grid) the grid's control system can assume that the load is always positive except at a finite and fairly small number of known points, the grid's generators, which are controlled by the grid itself. When individual users can put power back into the grid, the load can become negative at any arbitrary location in the grid, without warning. That greatly complicates the control problem. The dream has to be a proper demand response system, with electric cars being a key sink for excess generation. Yes, and who's going to pay for that? (Not the electric cars, but the improvements in the grid that allow it to make use of them as storage.) An obvious solution is to charge the people who are creating the problem by making their connection with the grid two-way instead of one-way.

angrybits 13y ago

for the curious, here's the bill itself: http://webserver1.lsb.state.ok.us/cf_pdf/2013-14%20ENR/SB/SB1456%20ENR.PDF http://webserver1.lsb.state.ok.us/cf_pdf/2013-14%20ENR/SB/SB...

kordless 13y ago
I'm hesitating to say collusion is involved, but given the brevity of the act and speed by which this is being passed, it's probably not far off the mark. Also, 'emergency' purposes isn't even defined.

nhebb 13y ago

Based on the issues Hawaii has had, this may not be as stupid as the Yahoo writer makes it sound: http://www.scientificamerican.com/article/a-solar-boom-so-successfull-its-been-halted/ http://www.scientificamerican.com/article/a-solar-boom-so-su...

revelation 13y ago
A quick cursory glance on how Hawaii does energy seems to show some rather more important issues than stifling solar growth: http://www.eia.gov/state/?sid=HI#tabs-4 http://www.eia.gov/state/?sid=HI#tabs-4

bowlofpetunias 13y ago

Selling power back to the grid is a rapidly growing home industry which, like any other, should be taxed and regulated. (Emphasis on "like any other", since libertarians will undoubtedly be against the whole principle.) If you produce something and systematically sell it for profit it's perfectly normal. It's not your kids' lemonade stand or a garage sale we're talking about here. The challenge is to do it in such a way that still stimulates the practice, not punish it. Simply calling any form of taxation "dumb" is not constructive. Also, it's not just the simple "Jimmy has a solar panel on his roof" scenario we're talking about here. Collective solar energy initiatives on residential properties are becoming a real industry.

raldi 13y ago
Your first sentence needs an addendum starting with "because..."
- chc 13y ago
  I think that's how the second sentence is meant to function. It should be taxed like any other business because it is substantially like a normal business transaction.
kordless 13y ago
Keep in mind that it's not a charge for selling power back, it's a charge for connecting it to the power grid. Not everyone running solar sells back to the grid.
thaumasiotes 13y ago
I'm extremely intrigued by the co-occurrence within a span of 3-4 sentences of > Selling power back to the grid is a rapidly growing home industry which, like any other, should be taxed and regulated. (Emphasis on "like any other" with > It's not your kids' lemonade stand or a garage sale we're talking about here. I believe close to 100% of lemonade stands and garage sales both completely ignore local regulations (in fact, every so often you read about the police red-facedly shutting down a lemonade stand) and hide all their income for tax purposes. Can you elaborate on why this is a bad thing?

wglb 13y ago

The core of the issue is will specifically target those who install power generation systems on their property and sell the excess energy back to the grid One of the incentives for doing your own power generation is that in most cases utilities are required to buy back the power under the Net Metering deal. This is a good thing, in general, but there are some engineering issues. When this was invented, I don't know if anyone involved did the calculation of "what if we have tens of thousands of houses generating enough backflow to rival the amount generated by the rest of our system?" The movement has been so successful that now we can see the possibility that on a very sunny day or windy day or both that these local generation sites are generating enough power that there isn't any where to put it. Voltages rise, breakers trip, sectors go dark. If you are a utility company, you likely have several energy sources at your disposal: hydroelectric, coal-fired plants, nuclear. For each of these sources, you have at your disposal a knob, generally sitting at 5 or 6 that you can turn down a notch to move the water past the generators and down the stream, turn off a couple of burners in the coal fired plant, or move the quenching rods in a little further to reduce the output of your nuke plant. If you have a tens of thousand of home pushing energy back up what used to be exclusively the down pipe. There isn't any centrally-located control knob for that. Certainly part of the reluctance of the utilities is a resistance to the new ways of the world, but it would be imprudent to discount the engineering issues that this is exposing. Yes, the utilities, who are not known for large amounts of imagination, should have been ahead of this and embraced this. But here we are. So in light of that, if taxation slows this unsustainable growth in home solar installations pushing current up the down pipe, perhaps it is not all that bad as the article makes it sound.

madospace 13y ago

How about tax on Angel investment ? yea it happens in India - http://www.nextbigwhat.com/funding-startups-could-be-classified-as-income-budget-2012-297/ http://www.nextbigwhat.com/funding-startups-could-be-classif...