Opinion: The war over rooftop solar
In a number of states, the incumbent utilities are challenging the “net metering” that makes rooftop solar attractive to homeowners and businesses. A photovoltaic solar system generates energy when the sun is shining, but the owner may not consume all these kilowatt-hours as they are generated. So the excess energy goes onto the local circuit and is used by other buildings that don’t have solar. Net metering allows the owner to take credit for this energy by subtracting it from their total energy consumption, even thought it occurs at different times. The owner pays only for electricity used in excess of what is generated. Remember that vertically-integrated investor owned utilities are not like regular businesses. They make money by investing their capital in power plants, transmission lines, etc. and receiving an almost-guaranteed return (Xcel/PSCo’s is 10-plus percent.) They make additional profits on energy sales into the spot market. These two reward structures incent them to ...