SRP AZ question

[TaylorMade]

We have been getting quotes for our home in Chandler, AZ. We are in SRP territory. Our last salesman (Harmon) told us that because we are with SRP and they re-set with the April bill that we shouldn't try to get the bigger system that would generate 80-90% of our yearly use, but a system that does about 63% of our yearly use because we would never be able to use the credits when they were needed for the summer months. We have the roof space. Thoughts?

[inetdog]

We have been getting quotes for our home in Chandler, AZ. We are in SRP territory. Our last salesman (Harmon) told us that because we are with SRP and they re-set with the April bill that we shouldn't try to get the bigger system that would generate 80-90% of our yearly use, but a system that does about 63% of our yearly use because we would never be able to use the credits when they were needed for the summer months. We have the roof space. Thoughts?

The choice of date for zeroing out the bill credits will affect the first (and last) years of PV use. There is no way that it can cause the credits "never" to be usable.
If you get billed each month rather than a single billing at true-up time, you may end up paying up front for power and then seeing a reduced bill later. That will cost you some fraction of a year's worth of interest payments, but the credits will eventually get applied. If you cannot use last year's credit, you will instead get to apply next year's credit in advance of next winter.

[TaylorMade]

The choice of date for zeroing out the bill credits will affect the first (and last) years of PV use. There is no way that it can cause the credits "never" to be usable.
If you get billed each month rather than a single billing at true-up time, you may end up paying up front for power and then seeing a reduced bill later. That will cost you some fraction of a year's worth of interest payments, but the credits will eventually get applied. If you cannot use last year's credit, you will instead get to apply next year's credit in advance of next winter.

The credits do not roll forward after April billing. They zero out again.

[inetdog]

The credits do not roll forward after April billing. They zero out again.

Yes, but the following summer's credits roll through to that winter.
You lose one summer's worth of credits, not every summer's credits!
If you are looking at a 20 year use period, the loss of one summer's production credit in the first year will delay payback but should not affect your decision on how big to size the system for the majority of the system life.

[TaylorMade]

Yes, but the following summer's credits roll through to that winter.
You lose one summer's worth of credits, not every summer's credits!
If you are looking at a 20 year use period, the loss of one summer's production credit in the first year will delay payback but should not affect your decision on how big to size the system for the majority of the system life.

Thanks. I am just going in circles with my husband on this. So the Spring/Winter we use the least amount of power, and the summer the most. The system would produce the most in the Spring/early Summer and go down as the heat kicks in here. It's no wonder SRP chooses the end of April as their cut-off. Then it's pennies on the dollar for the credits. My parents have APS and it's a much better deal as they switch at years' end.

[Ian S]

Thanks. I am just going in circles with my husband on this. So the Spring/Winter we use the least amount of power, and the summer the most. The system would produce the most in the Spring/early Summer and go down as the heat kicks in here. It's no wonder SRP chooses the end of April as their cut-off. Then it's pennies on the dollar for the credits. My parents have APS and it's a much better deal as they switch at years' end.

I think the Harmon guy has it right. Every year, you will start fresh in April and have limited opportunity to build up credits for the summer where the big usage is. Then by October, when you are using a lot less electricity, you will start to amass lots of credits and continue to do so until the following April. Those will be zeroed out at 4-5 cents per kWh but you'll have paid far more than that the previous summer for the electricity you used. If you go with a larger system, you'll have more offset of high cost summer electricity but then even more credits in April that are paid off on the cheap. I'm with APS and my solar is sufficient to cover 66% of my usage. But even with the end of year trueup, I wind up having hundreds of kWh that get zeroed out at < $0.03 per kWh. But I do offset all of my peak usage over the year so it's a reasonable tradeoff. Now I have gas heat so it might be different if you have a heat pump that can use a lot more of your winter production.

[EEMLoanGuy]

We have been getting quotes for our home in Chandler, AZ. We are in SRP territory. Our last salesman (Harmon) told us that because we are with SRP and they re-set with the April bill that we shouldn't try to get the bigger system that would generate 80-90% of our yearly use, but a system that does about 63% of our yearly use because we would never be able to use the credits when they were needed for the summer months. We have the roof space. Thoughts?

Your sales rep is correct. As a very general rule of thumb you don't want to size a system larger than 66% of annual usage for SRP customers and in many cases even less. Not only is production credit expiration and issue with SRP, so is the structure of their time of use plan. You're receiving good advice from this rep. It takes a bit of time for it to make sense, but I'm sure the rep can sit down and go over the math with you if you'd like.

[TaylorMade]

Your sales rep is correct. As a very general rule of thumb you don't want to size a system larger than 66% of annual usage for SRP customers and in many cases even less. Not only is production credit expiration and issue with SRP, so is the structure of their time of use plan. You're receiving good advice from this rep. It takes a bit of time for it to make sense, but I'm sure the rep can sit down and go over the math with you if you'd like.

Thanks!!

[inetdog]

Draw a time line covering multiple years and make a sliding scale that covers 12 months. Now draw the energy production graphs and energy use graphs which repeat unchanged year after year.
Wherever you move the sliding scale, it will cover exactly one year of use and one year of production. All that will vary will be whether each one peaks earlier or later in the one year window.
Once you get past the first fraction of a year, where it will make a difference because you have less than a full 12 month window, it will not matter at all where the window sits. The net surplus or deficit will be exactly the same. All that will change is when you pay higher or lower bills.
Net will be exactly the same.
Now there are a lot of other factors about your POCO which influence how much production makes sense, and those include consumption tier pricing, time of day pricing, seasonal adjustments and whether or not you get anything (like wholesale rate) at the end of the year. But when in the calendar year the true-up comes is not one of them, except for the very first year.

[Ian S]

Draw a time line covering multiple years and make a sliding scale that covers 12 months. Now draw the energy production graphs and energy use graphs which repeat unchanged year after year.
Wherever you move the sliding scale, it will cover exactly one year of use and one year of production. All that will vary will be whether each one peaks earlier or later in the one year window.
Once you get past the first fraction of a year, where it will make a difference because you have less than a full 12 month window, it will not matter at all where the window sits. The net surplus or deficit will be exactly the same. All that will change is when you pay higher or lower bills.
Net will be exactly the same.
Now there are a lot of other factors about your POCO which influence how much production makes sense, and those include consumption tier pricing, time of day pricing, seasonal adjustments and whether or not you get anything (like wholesale rate) at the end of the year. But when in the calendar year the true-up comes is not one of them, except for the very first year.

Not true in Arizona at least for APS. You get a monthly bill and if your production plus accumulated credits is not enough to offset your usage that month, then you pay out of pocket at the retail rate which for the summer is high even higher if you have TOU. Later in the fall and winter, when you overproduce, you don't get to go back and retroactively apply those credits to your summer usage. Instead, those credits accumulate especially if you have until April (SRP) to do so and you get a fraction of what the retail rate is. APS employs an additional trick on TOU: your peak and off-peak credits go into separate buckets and they never can be combined. When I installed my solar, I realized I would over produce peak and underproduce offpeak but since the trueup rate was about the same price as that for retail off peak, it effectively wound up combining the buckets at trueup. But APS changed the rules so that the trueup rate is less than half the retail offpeak so that no longer works for me.

The way SRP has it set up, you will either pay them through the nose out of pocket in the summer or, if you size large enough to not buy from SRP during the summer, you will get screwed at the following April's trueup. I fully expect APS to soon have a "Hey, wait a minute" moment as they realize they can also change to an April trueup and charge solar customers more without appearing to raise rates or add fees.

[inetdog]

OK, that is much more than just an April true-up, it is an April true-up and no ability to apply credits to earlier parts to the cycle year. That is definitely against the spirit although probably not the letter of net metering. PG&E would not be able to get that past the regulators here in CA.

[prhamilton]

I think it is called a monthly true-up with an annual zero-out in April. Seems like a pretty restrictive program, they should fix that.

I have a monthly true-up with no zero-out for the generation portion of my PG&E build. I pay my generation fees/credits to Marin Clean Energy and my distribution goes through PG&E with the annual true-ups. My statement is pretty complicated and I have only been on the plan for 2 months so I haven't seen how it will work in practice.