One of our astute readers contacted us to ask if we had noticed that SCE had just increased their rates—and dramatically. That got our attention so we decided to spend some quality time amidst SCE’s tariffs. The news is mixed: terrible news for people who are going to have to pay these crazy rates, but great news for everyone who can install solar. In fact, SCE’s new domestic rate is about all anyone would need to be convinced to finally make the switch to solar.
In case you did not know it, every SCE tariff—that is, the rate structures under which they bill their customers such as the Domestic tariff for most residential customers or GS-1 and GS-2 for most commercial customers—can be found on their website. If you know where to look. (Hint: look here!) Of course, when you do find what you are looking for, you are rewarded with something that looks like this:
This is one half of SCE’s Domestic rate (the delivery portion)—and this is about the simplest rate structure that they use! So it is not surprising that most normal people don’t really examine these things to see what is going on—they just groan and pay the bill.
But we suspect people will do more than groan when they look at their bills this summer.
We had been working on a solar proposal for a prospective client in SCE territory when we learned about the rate change. The client’s usage was relatively high, averaging 55 kWh/day over the course of the year; high, but still far lower than some of our clients. Under the rate structure in effect prior to June 1, this client’s annual bill worked out to $5,100 but after applying the new rates her annual total jumped to $5,750—an increase of a whopping 12.7%!
We will pause a moment to let that sink in.
What about that other potential client we wrote about, the one whose SCE bill already contained an incredibly misleading chart purporting to help her understand her bill. What impact will these new rates have for her? Under the rates in place before June 1, her total bill for the year was an already eye-popping $8,435—ouch! But under the new rates? Her new bill becomes $9,560—an increase of 13.4%!
So what is actually going on here? Turns out that the rates on the high end, Tiers 3 and 4, are the culprits, increasing by 16.4% and 14.8% respectively. Live in Tier 4 this summer and you will be paying 34.8¢/kWh for the privilege!
There is a silver lining here and that is that adding solar pays off better than ever. If your solar power system gets you out of Tier 4 alone, you will save thousands of dollars a year. For our prospective client who averaged 55 kWh per day, her savings come to $4,171 in Year 1. Even without a rebate from SCE (which for now at least has gone the way of the Dodo), her payback is in Year 5! After 10 years, thanks to these new rates, she will have saved an additional $25,000! And by avoiding a lease (this client is planning on using HERO financing), those benefits all go to her!
We have said it before and we will say it again: utility rates are only going up. While this example pertains to just SCE’s residential customers, guess what? You commercial customers are about to see your rates go up as well (more on that soon). And muni customers, now is not really the time to feel smug as your rates are going up too (and yes, PWP folks, we mean you!).
Give us a call and let’s see if we can’t help—contrary to the song, we’ve got a cure for these summertime blues!
We have looked at a lot of electric bills.
Pretty much every potential client that we speak to sends us a year’s worth of their electric bills as the first step in the process of getting a proposal for adding solar to their home or business. We use that data to model what your actual savings will be, based on the rate structure that the utility applies to you as their customer. Some of those rate structures are really complicated (like this time-of-use rate for EV charging), but for most residential clients, the rate should be relatively straight forward. After all, you are only paying for total usage (not demand charges) and most folks aren’t yet on a time-of-use rate. How complicated can it be?
But we had a bit of an epiphany the other day as we tried to explain an SCE bill to a couple at their kitchen table. Perhaps you’ve noticed this little chart if you are an SCE customer:
Presumably this is SCE’s attempt in helping you to understand your bill. So what is going on here? SCE residential customers are under a tiered rate structure. The lowest tier, the so-called baseline rate, is relatively cheap at roughly thirteen cents per kilowatt hour for the first few hundred kilowatt hours needed. Of course, no one uses just their baseline allocation and so the second tier is a tiny slice that is 30% of the baseline. If you stay in those first two tiers, congratulations, you are getting some pretty cheap energy.
Tier 3 is where things start to get pricey, with the cost per kilowatt hour doubling from what you paid for baseline. Tier 3’s allocation is 70% of baseline, which mean that if you use more than twice your baseline allocation, you are out of Tier 3 and into the dreaded Tier 4 where you will pay more than 31¢/kWh.
Ok, so far so good. But notice the odd thing that is going on in that graph. The widths of Tiers 1-3 are actually proportionate to reality. The width of the bar for Tier 1 is equal width to the sum of the bars for Tiers 2 & 3— which is exactly how the rate structure works. But what is going on with that bar for Tier 4? At a quick glance, you might think that you are using about the same amount of energy in Tier 4 as you did in Tier 1 (or Tiers 2 & 3). But look at the number: whereas Tier 1 was 399 kWh, the usage in Tier 4 is more than four times that amount at 1,799 kWhs! This client is living in Tier 4!
This is not only not helpful to “understanding your bill,” this is downright deceptive.
So what should this actually look like if drawn to scale? How about this:
Now the true impact of this client’s high energy usage starts to become clearer. Their usage is dominated by Tier 4 but you never would have seen that relying on the chart provided by SCE.
Of course for most clients, they are more interested in what they are paying, and it is here that the real impact of SCE’s tiered rate structure comes home. Check out this chart:
Wow - this client is spending 10x as much on Tier 4 as they are on Tier 1! That is some painful energy costs right there!
To be sure, if you review your bill carefully, you could find this same information, but the bill obscures the facts by parsing out the numbers in a manner that only makes sense to the lawyers who crafted the rate structure (and those of us who have made it our business to decipher them).
We have a suggestion to our friends at SCE—if you really want to help your customers understand their bills, start by ditching the misleading charts and replace them with a clear representation that makes the facts readily understandable.
In the meantime we will continue to do our part, one kitchen table at a time.
It is official, Unirac has decided to discontinue its Solarmount Evolution product, thereby ending the run of what we considered the best solar racking solution in the industry.
This despite our Open Letter to Unirac Management. Who would have guessed that they would ignore our concerns? (Well ok, pretty much everybody would have guessed that…)
In a one-line email, SM-E Product Manager, Keith Hardy broke the bad news:
After much deliberation, Unirac has decided to discontinue sales of the SME product line (effective 30 May 2014). Thank you.
Less it be lost to the sands of time, this is how Unirac used to promote this product:
Silly us, we actually believed that this was a product that “redefined what residential mounting systems can offer distributors and installers.” To say nothing of homeowners, the most important constituency in this whole process. Suffice it to say, we think this is a really bad call.
No word from Unirac on what is replacing SM-E, if anything, and with Intersolar 2014 just around the corner ("are you goin’ to San Francisco?") it looks like we will be in the market for a new racking solution.
Cue the sales people—our business is now up for grabs!
We have been waiting quite a while, but the good news is that HERO Financing for residential solar has finally arrived in Los Angeles County!
On Friday, May 23, the HERO Financing program formally launched in LA County after being a huge success in Riverside and San Bernardino counties, helping fuel explosive growth of solar installations in those counties.
Here is how they describe the program:
The HERO Financing Program provides homeowners a unique opportunity to make home energy
improvements through property tax financing. Benefits include 5-20 year terms, tax-deductible interest,
transferability when the property is sold and consumer protections.
To learn more go to heroprogram.com
Unfortunately, not every city in LA County is (presently) participating—most notable laggard from our perspective? Pasadena! Come on, Pasadena, what is up with this? Pasadena was signed on to the PACE program years ago, so what is holding you back now? (Oh, and the City of LA is not signed on yet either, but no shock there.)
Here is the list of participating cities in LA County as of the program rollout:
|Alhambra||Hawthorne||Rancho Palos Verdes|
|Azusa||Hermosa Beach||Rolling Hills|
|Baldwin Park||Inglewood||Rolling Hills Estates|
|Carson||La Cañada Flintridge||San Dimas|
|City of Industry||La Verne||San Gabriel|
|Diamond Bar||Monrovia||South El Monte|
|El Monte||Montebello||South Pasadena|
|El Segundo||Monterey Park||Temple City|
If you would like to encourage Pasadena to get with the program, here is some contact information for you:
Bill Bogaard, Mayor (626) 744-4311
Margaret McAustin, Vice Mayor (626) 744-4742
Jacque Robinson, Council Member - District 1 (626) 744-4444
John J. Kennedy, Council Member - District 3 (626) 744-4738
Gene Masuda, Council Member - District 4 (626) 744-4740
Victor M. Gordo, Council Member - District 5 (626) 744-4741
Steven Madison, Council Member - District 6 (626) 744-4739
Terry Tornek, Council Member - District 7 (626) 441-4802
We are looking forward to participating in the HERO program. We hope it will help more homeowners finance solar power projects with little or no upfront costs, and in a way that is far more financially beneficial to them then other financing mechanisms, like solar leasing.
Is your solar power system safe? How can you be sure?
We are receiving more and more inquiries about fixing solar power systems from folks whose system has stopped working and the original installer can no longer be found. Sometimes a violent act of nature prompts the need for our services, but all too often we are seeing shoddy work that has failed far too soon.
Case in point, we received a call from a true “rocket scientist” the other day who had a solar power system installed about seven years ago, but now he was having a problem. We learned that the system had been installed by an air conditioning company (you’ve seen their ads), and it had two SMA Sunny Boy 2800 inverters—now well out of warranty—and one of them was displaying the dreaded, ground fault error. Ground faults occur when a normally ungrounded, current-carrying conductor makes contact with something that is grounded, such as the frame of a solar module, the system racking or even the conduit itself. Ground faults can be dangerous and are often difficult to locate.
When the solar system owner contacted his installation company, they offered to replace his offline inverter—for $5,000! Of course, simply replacing the inverter was unlikely to do anything about the ground fault, and it was possible that there was nothing wrong with the inverter at all, apart from being out of warranty. But in any event, charging $5,000 to simply do a one-for-one inverter replacement was highway robbery, and the system owner was pretty annoyed by the time he got around to calling us. Since there was no way to properly diagnose the situation over the phone, we agreed to come out and take a look.
Sure enough, one of the inverters was working fine, but the other displayed a ground fault message. The system owner told us that there was a combiner box on the roof, so we headed there to try and figure out where the fault might be. Here’s what we found in that “combiner box":
This is so NOT a combiner box!
This is a junction box into which the folks who threw this system together crammed the wires coming from the strings, joined them together (without any fusing to protect the array, to say nothing of the house) and then routed them downstairs to the inverters.
Another problem—the wires coming into this non-combiner box are all THHN, which is fine for a conductor running in conduit, but is no good at all for conductors coming from solar modules in the array. The insulation here is simply not designed to hold up under years of exposure to sunlight.
This is simply ignorant, shoddy work that has no place in the solar industry. Sadly, this particular company has not gone out of business, though the world would be a better place if they had.
People can get hurt this way. Property can be destroyed this way.
And the solar industry can get a very bad reputation this way.
We broke the bad news to the system owner and explained that what was needed was to replace the box on the roof with a proper combiner box, replace the improper wiring with USE-2 wiring that is designed to last on a roof, and bring the system back online. We also suggested that given that his existing inverters were out of warranty, he might want to consider upgrading to a single, transformerless inverter that would provide a ten-year warranty, the possibility of online monitoring, and much greater efficiency. That was the path he decided to take.
We installed an Outback combiner and upgraded the wiring. In so doing we managed to bring some order out of the previous chaos, take a look:
Now each of the four strings is properly protected by a dedicated, touch-safe fuse, and there is proper stress relief on the USE-2 conductors entering the box from the array.
We also installed ground lugs on each of the rails—something the air conditioning guys hadn’t bothered to do—and we installed two end clamps that had somehow been overlooked when the install was done.
The cool, new SMA 5000TL inverter allowed us to add monitoring to the system, as well as SMA’s emergency power outlet that provides a nominal amount of power from the array, even if the grid fails. In the process we were able to clean up the wiring on the ground, get rid of those air conditioning disconnect switches and install a proper disconnect. Oh, and while we were at it, we even arranged to donate the old inverters to Habitat for Humanity, providing the system owner with a charitable tax deduction!
Most importantly, we were able to restore his confidence in the solar array on his home. And maybe, even a bit of confidence in the solar industry itself.
There are a number of take aways from this experience that we would like to stress:
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