Going solar isn’t the only thing you can do to reduce your electric bills and your environmental footprint. In fact, the first thing you should consider is how you could make your home more efficient BEFORE investing in solar. Investing in a solar system that is bigger than you really need is just a bad investment strategy since efficiency upgrades are often much more affordable than the solar system required to offset the ineficient loads.
One option is to hire a professional to give you a thorough energy audit which will help to pinpoint where your electrical hogs are and what you can do to improve efficiencies. Alternatively, there are a lot of relatively simple steps you can take if you know what to look for. Changing out your old light bulbs to LEDs is an obvious and easy fix for example. But one of the biggest and often under the radar culprits that I’m here to tell you all about are pool pumps.
Pool pumps can have such a big effect on your electric bill that we always discuss it when doing a solar site evaluation at any home fortunate enough to have a pool. Of course we don’t recommend eliminating your pump altogether as they are necessary to keep your water filtered and clean. So what is the solution? There are all sorts of newer “efficient” pool pumps out there and likely your pool guy/girl will happily install if you say you’d like an upgrade. However, what you really need if you want to make a dent in your electrical load is something called a “variable speed” pool pump.
A variable speed pool pump is exactly what it sounds like… Rather than pumping water with a consistently high speed you really only need max power at the outset to get the water moving. Once its moving the variable speed pump then downgrades the output power to keep the water moving since less energy is required to keep something moving than to get something going from a standstill. This reduced speed equals reduced energy loads!
We have heard clients who installed variable speed pumps have seen reductions on their bill on the order of over $500 per year!
The downside for these pumps is often the price is much higher than regular pumps. But I come bearing good news! Many utilities offer rebates and incentives for Energy Star qualified pool pumps. In our home turf of Pasadena, California we are fortunate to have a very proactive utility, Pasadena Water and Power, striving to help residents lower their footprint. They normally offer a rebate of $400-$450 off the sticker price for a variable speed pump. However, I was just notified that PWP is running a promotion on all of their energy efficient appliance rebates through October 31st, 2016:
“PWP is offering a $900 (bought outside Pasadena) to $950 (bought locally) rebate to all PWP residential electric customers who replace their old pool pump with a new energy efficient variable speed or variable flow pool pump and motor. Replacing older inefficient pool pumps with new efficient models will not only help you reduce energy use but save you money. With the summer heat and the possibility of rolling blackouts, PWP wants to make sure you do your part to conserve energy."
We couldn’t agree more! Check PWP’s rebates listing for a list of other rebates to take advantage of. The listed prices on the website include the current promotion.
If you’re not in PWP’s service area, never fear! You can check if your utility has rebates on the Energy Star website.
After you’ve addressed all the drafty windows, switched out your lightbulbs and upgraded all your appliances, then it is time to give Run on Sun a call (626-793-6025) and we’ll help you offset the rest of your energy needs!
UPDATE - 5/28/16 - Despite our best efforts, AB 2339 was HELD in the Appropriations Committee, effectively killing the bill this session. Thank you to everyone who took the time to call and voice their support for the bill. Special thanks to Frank Andorka who created a podcast in support of the bill, all the way from Cleveland! We lost this battle, but the fight continues.
UPDATE - 5/26/16 - We passed the Assembly Utilities Committee on a 10-2 vote, but right now we are stuck in the Assembly Appropriations Committee, chaired by San Diego Democrat Lorena Gonzalez. The decision of whether to allow AB 2339 to advance to the Assembly Floor rests in the hands of two people: Chair Gonzalez and Speaker Rendon. Please take a moment to give them a call and urge them to support the bill. Here are their numbers:
Back in February we wrote about the new Net Metering 2.0 rules that the California Public Utilities Commission (CPUC) approved over the objections of the Investor-Owned Utilities (IOUs), SCE, PG&E, and SDG&E.
We noted at the time that the CPUC rulemaking did not directly affect the Municipal Utilities (munis, like Pasadena Water and Power). Boy was that right as muni after muni is looking to shut down Net Metering altogether! Here’s our take, and more importantly, an action item that you can take to preserve Net Metering with the munis.
The munis are generally free, within the limits of state law, to set their own policies as confirmed by the local city council. So here in Pasadena, PWP sets its policy but has to have that policy ratified by the city council’s vote. When it comes to Net Metering, state law requires that the munis, like the IOUs, offer Net Metering agreements until the amount of solar deployed exceeds “5% of the electric utility’s aggregate customer peak demand.” (CA Public Utilities Code § 2827) Now if that quote seems like less than a model of clarity, you are quite right. Before the CPUC, the IOUs argued that it meant that you look at a utility’s highest peak demand as of a certain point in time, and that would be the cap. Such an interpretation, however, reads the words “aggregate customer” out of the statute. The CPUC agreed, and the proper interpretation requires the utility to sum the aggregate demand from each customer and that becomes the cap.
The results are dramatic - the proper interpretation effectively doubles the total amount of solar allowed under the cap. That decision by the CPUC back in 2012 redefined Net Metering, but only for the IOUs. At the time there was little concern regarding the munis since none was close to reaching their cap.
Fast forward to today and five munis have already reached their caps, as calculated under the old, pre-CPUC ruling, methodology. That leaves them free to replace Net Metering with whatever they choose, and at least one, Turlock, has adopted new rules that have resulted in an 85% decline in the solar market there! (In contrast, LADWP has already agreed to the new methodology thanks to leadership from Mayor Garcetti.)
Fortunately there is a fix in the works. AB 2339 (Irwin - D-44) will require that the munis calculate their caps in effectively the same way as the IOUs. The bill is presently in the Assembly Committee on Utilities and Commerce, chaired by Mike Gatto (D-43) - a former student and colleague of mine, and a champion of clean energy.
We need the strongest bill possible coming out of the committee, and you can help make that happen. How? Our friends at CALSEIA have compiled a target list of key assembly members who need to here from their constituents on this bill. From the CALSEIA newsflash:
- Jim Patterson (R-Fresno/Clovis) 916-319-2023
- Susan Eggman (D-Stockton/Mountain House/Thornton/Tracy) 916-319-2013
- Mike Gatto (D-Burbank/Glendale/La Canada/La Crescenta) 916-319-2043
- Bill Quirk (D-Hayward/Ashland/Castro Valley/Cherryland/Fairview/ Fremont/ Pleasanton/San Lorenzo/Sunol/Union City) 916- 319-2020
- Miguel Santiago (D-Huntington Park/Vernon) 916- 319-2053
- Eduardo Garcia (D-Imperial/Blythe/Brawley/Calexico/Cathedral City/Coachella/Desert H.Springs/El Centro/Indio) 916- 319-2056
- Christina Garcia (D-LA/Bell Gardens/Bellflower/Cerritos/Commerce/ Downey/Montebello/Pico Rivera) 916- 319-2058
- David Hadley (R-Torrance/Gardena/Lomita/Manhattan Beach/Palos Verdes Estates/Redondo Beach/West Carson) 916- 319-2066
- Phil Ting (D-San Francisco) (916) 319-2019
- Rocky Chavez (R-Oceanside/Calsbad/Encinitas/Vista) (916) 319-2076
If you live in one of those districts, or if you run a business in one, or have customers there, please contact that member.
More generally, there is a website where anyone can go to express their support for expanding the benefits of Net Metering to muni customers throughout the State. Just click on the button to make this happen:
Sadly, the list of entities opposing this bill includes Pasadena Water and Power - looks like we need some political leadership here in our own backyard to get PWP on board.
We will update this post as the bill progresses through the legislature - watch this space!
The new year is well underway (Happy New Year!), and so it is timely to revisit the question of financial incentives to Go Solar in the Run on Sun service area. (You can read more detail about all of these incentives on our Solar Financing page.)
Beyond a doubt, the most significant incentive for going solar is the 30% federal tax credit. Previously set to expire at the end of this year, the federal solar tax credit was extended late last year, continuing at the present 30% through 2019.
The credit applies to solar installations in every utility’s territory, so no matter where you live in the U.S., this credit applies to you. (NB: this is a tax credit, not an income deduction, so you need the tax “appetite” to take full advantage of this incentive - check with your tax advisor.) For residential clients, the basis for the credit is the full cost of your solar project, less any rebate that you might receive from the utility. Commercial clients, who must declare any rebate as income, do not need to deduct their rebate from the system cost when calculating the basis.
Once common everywhere, utility rebates are going the way of the dodo—with one or two notable exceptions. We have rank ordered the local utilities below, based on the reliability of their rebate program.
The big winner, again and by far, is the solar rebate program operated by our own Pasadena Water and Power. Year in and year out, PWP offers rebates to its customers in a transparent and consistent manner - something that cannot be said of any of its neighboring utilities.
As of this writing, PWP is offering a rebate of $0.45/Watt for both residential and commercial customers, and a rebate of $0.90/Watt to non-profit customers (who cannot take advantage of the federal tax credit). Alternatively, PWP also offers a performance-based incentive that is paid out over two years based on the actual production of the system. Residential and commercial customers are paid 14.4¢/kWh, whereas non-profit customers are paid 28.8¢/kWh.
LADWP offers a rebate, if you have the stamina to receive it. Vexed with the most bureaucratic process to be found this side of Orwell’s 1984 dystopia, applying for and receiving a rebate from DWP often feels like a reward for a life well spent.
That said, LADWP is currently offering rebates of $0.30/Watt to residential customers, $0.40/Watt to commercial, and $1.15/Watt to non-profits. Just don’t hold your breath.
These two municipal utilities often feel like one and the same given their similar approach to rebates - which is to say, now you see ‘em, no you don’t.
Unlike their neighbor to the east, neither BWP nor GWP is able to maintain a rebate program throughout the year. Instead, both open their rebate windows on or about July 1st (i.e., the start of their fiscal year) and then hand out money until it is gone, at which time the window slams shut until the following July 1.
Burbank’s program operates under a lottery, which last year opened on July 1 and was exhausted by August 15. In addition, BWP imposes restrictions on the azimuth and pitch of rebated systems, despite their being no technical justification for doing so.
Glendale’s program is even less transparent, and the installation/rebate process is outlined in a 23-step ode to inefficiency.
We will revisit both of these program in mid-June to provide what guidance we can to the residents of these two cities.
The “Solar Partnership Program” in Azusa is fully subscribed. There is a wait list that solar-hopeful customers can get on in the hope that at some point there will be rebate funds available - with no guarantees that there ever will be.
The Anaheim Solar Incentive Program was fully subscribed as of October 1, 2015 and is now closed, with no published plans to revise the program in the future.
SCE’s rebates, which were part of the larger, California Solar Initiative, have expired and no new funds are anticipated. Of course, SCE customers still have the highest electricity rates around, which provides its own—albeit perverse—incentive to Go Solar!
Recently a potential client was asking us about an oddity in their Pasadena Water and Power (PWP) electric bill. PWP has a tiered rate structure, but the most visible component of that tiering, the Distribution charge, steps up above 350 kWh of usage in any one month, but it steps down above 750! Which lead us to the question, are PWP’s electric rates regressive?
PWP’s Residential rate structure, like many utility tariffs, is a model of complexity. On your bill there are a number of obvious charges, and a few that are not so obvious. The obvious ones are on the right-hand-side of the bill and include a Customer charge, a Distribution charge, a Transmission charge, and an Energy charge. (The not-so-obvious charges include those related to public benefit programs and paying to put power lines underground.)
All of these obvious charges are tied to the customer’s usage, but only one, the Distribution charge, is tiered. At or below 350 kWh of usage per month, the customer pays just 1.5¢/kWh. Between 351 and 750 kWh of usage the Distribution charge increases dramatically all the way up to 11.65¢/kWh, nearly an eight-fold increase! Ok, the whole point of a tiered rate structure is to discourage higher use by making you pay more as your usage increases. But PWP’s rate then does something truly odd - above 750 kWh/month the rate comes down, dropping from 11.65¢/kWh to just 8.5¢/kWh! What sort of an incentive is that?
That rate design is certainly counter-intuitive, to say the least, but is it regressive? In other words, is there a point at which a large residential user ends up paying less per kWh than does someone who uses less? To find out, we modeled daily usage from 10 kWh/day all the way up to 60 kWh/day. As a reference, a typical Run on Sun client in PWP’s service area averages around 25 kWh/day. Since the Transmission and Energy charges are adjusted higher in the summer months, we broke out the overall rates seasonally as well.
Here are our results (click for larger):
The blue line is the winter rate and the orange is summer. If you use a tiny amount of energy you will pay between sixteen and seventeen cents per kWh, with rates rising sharply until you get to 25 kWh/day. Beyond that, the rate of growth flattens out markedly, but it never dips down. (That is true even if you carry the analysis all the way out to 200 kWh/day!)
Contrast this with the SCE Domestic rate - that is a truly aggressively progressive rate structure with energy charges of 14.5¢/kWh for those using within the smallest (baseline) tier of energy, going all the way up to 30.8¢/kWh for energy used in the fourth tier, which kicks in for monthly usage above approximately 900 kWh.
So no, PWP’s Residential rate is not regressive, but by flattening out the rate for usage above 25 kWh/day, it sends at best a mixed signal if the utility is trying to encourage its customers to reduce their usage.
How does this relate to solar? Well, if your usage is above 20 kWh/day you are spending at least 20¢/kWh whereas the cost of a solar power system will be less than half of that! So yes, in PWP territory - and particularly while they still have rebates in place - installing solar will still pay you big dividends.
Pasadena Water and Power (PWP) is set to roll out an entirely redesigned Residential rate structure that could spark serious concerns if you are a big user of energy. Here’s our analysis.
PWP customers have been pretty smug (something we are apparently famous for) as we sit back and watch our neighbors in SCE territory suffer through significant rate increases. Well, no more. Now you too, fellow PWP customers, are about to feel the bite of a double digit rate increase. And here’s the thing—the more you use, the bigger that rate increase will be!
PWP has a somewhat hybrid rate structure, meaning that while the pure energy charges are the same no matter how much energy you use (in contrast with SCE’s four-tier rate structure), other components, most notably the customer and distribution charges, are actually tiered. In the newly revised rate structure the customer charge is now split out and is a flat fee of $7.76/month. The distribution charge, however, remains tiered under the new structure, albeit in an odd fashion. The first 350 kWh of energy per month see a low distribution charge of just 1.5¢/kWh. The next 400 are really jacked up: to 11.65¢/kWh before subsiding to 8.5¢/kWh for every kWh thereafter. Which raises the question: if you want to incentivize people to reduce their usage, why is the third tier lower than the second?
As a result of the change in structure as well as the rate components, the impact on your bill varies a lot depending on your usage, as you can see from the following chart:
As you can see, two bars (at 15 and 25 kWh) actually show rate decreases and the percentage increase continues to swing back and forth until you get to 35 kWh per day when the increase is monotonically upward.
Indeed, if you are sucking down 100 kWh/day, your rates will go up by nearly 50%!
Fortunately, very few customers are in such rarefied air as that; but a homeowner who had an average usage of about 25 kWh/day who then goes out and purchases an EV that she drives a lot, could bump into the 50 kWh range and she would see a 19% rate increase. Have a big house with a pool and a jacuzzi and a couple of EVs? If that gets you to 80 kWh/day your rate increase will be 40%!
In fact, it is actually worse than what we are showing here since this is only looking at the energy services part of your bill. On the left-hand-side of your bill you will find the Public Benefit Charge (tied to how much energy you use) and it is going up by 19%. On top of that are taxes that you pay on those energy services amounts and you can see that PWP customers, except on the lowest end of the scale, are in for some serious rate hikes starting July 1.
Of course, solar is the perfect hedge against these rate increases (and others sure to come in the future) and PWP still is offering the highest rebates around: $0.85/Watt. But in all likelihood we will see those rebates step down soon so now is the time to act! Give us a call at 626-793-6025 and let’s get started.
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