Knowing the Value Proposition of Your Local Utility
I’m sure you’ve looked around and noticed the sharp increase in solar panels on the roofs of your neighbors, and in general where ever you go throughout California. It is clear that many out there are both conscious of the low return if investment they receive from the utility and are subject to the frequent and unavoidable cost increases to pay for expanding infrastructure. After all, we all need electricity in modern world to keep life moving and you just have to accept whatever the utility charges.
As with anything in life, I’ve never been a compulsion kind of guy. The very premise behind Peak Power Solutions creation was to give customers energy options that add value to their life through education and liberating services/products, not force them into a single path. So what are you really paying the utility for anyways?
Well, I don’t want to bog you down with content that I’ve covered already a couple months back, but I do want to provide expanded detail of what you pay for with your local utility. Whether you are in San Diego Gas & Electric or Southern Cal Edison territory, rate cases are a nonstop occurrence. As SCE is presently in that mode, new rates will be rolling out in 2019. It is highly probable there will be some changes to the peak hours of the Time-of-Use rates as the large influx of solar generation in the state has caused the peak curves to change.
The rate increases also cover the costs of the constantly fluctuating fuel prices, fuels that are consumed to produce electricity. This would be especially prevalent for natural gas, as natural gas fired power generation is the most common in the United States (recently surpassed coal) as well as in California. It is important to continue using this method of generation because it is extremely reliable and has quick ramp up and ramp down times to deal with the large and erratic load of California. Furthermore, weather patters change and alters renewable output in seconds. An assured avenue, in all atmospheric scenarios, must always be in place to support the load requirements of California at any given moment.
A key area to consider is the having to pay for power imports into the CAISO grid. Imports are a mandatory part of the power portfolio for all utilities, but can be very costly when buying power from the real-time Imbalance Market. The Imbalance Market is a match-maker between over production in the western United States and the markets that need the power. If there is available load within the portfolios of the Imbalance Market participants, that load could be shared in the pool. The problem is you just don’t know when that will be, thus there is a premium associated with that type of volatility and dependability.
For quite some time, millions of Californians received output from both San Onofre and Diablo Canyon nuclear generating facilities here in California. Despite the highest uptime figures of any power generation source, nuclear power plants are being removed from the power portfolio of the state. San Onofre is already offline, and Diablo Canyon will follow suit no later than 2022. The utilities must charge a decommissioning fee to all the customers, and could be subject to an increase should EPA requirements necessitate such.
As generation sources are moving from remote areas to a local distributive generation format, elaborate and abundant telemetry is needed. Essentially, the utility needs to know how many electrons are flowing in both directions so that they know how much power to import and how to maintain the frequency at 60 hertz. You can breathe a sigh of relief; I won’t be delving into the trigonometry behind electricity today! In short, money is needed for the implementation and maintenance of advanced relays, metering equipment, and control mechanism are needed to uphold an ever-changing and evolving grid.
I hope our Peak Power Solutions blog is giving you the data needed to stay apprised of the energy market around you, and paving a way for you to make a sound decision toward your personal story of energy liberation. We look forward to serving you down the road.