Fair wholesale rate

[nothungry3]

Hi,
I have a solar system in CT with a fabulous reimbursement system. I sell power at retail rates. I realize that the power company (which does not produce power) must make a profit. I would like to know what a fair wholesale rate is when the distribution distance is measured in blocks rather than miles.
I plan to propose this to my state representative in hopes of avoiding Nevada-like legislation.
Jack

[solar pete]

Howdy Jack, I think you will need some locals to chime in on this one. I imagine it would vary a lot from state to state. Where I am in Australia it fluctuates from State to State, here in SA its about 12 cents, and we pay on average .36cent per kWh, lots of room for mark up by those middle men who produce nothing except for bills.

[DanKegel]

Well, there's "fair" (where solar owners pay for all the trouble they cause the rest of us), and "fair" (where everybody subsidizes solar so we can make a dent in reducing global warming). It all depends on where you stand, and what your policy goals are.

[DanS26]

Here's what is fair in Indiana.....at least if you are part of the privately owned REMC network in Southern IN.

Hoosier Energy, which is owned by 18 customer owned REMCs, produces coal fired electrical power at ~$0.025kWh at the plant before it's distributed to the 18 members. Distribution and Administrative costs add ~$0.045kWh. So Hoosier sells delivered power to its owners at ~$0.07kWh.

The 18 REMCs turn around and deliver power to their customer/owners at ~$0.125hWh. The REMCs operate on breakeven basis so all profits are returned as capital credits in subsequent years. It's a nice little business model and works well as long as the managers and employees keep costs under control.

Any excess power that I produce I am paid $0.07kWh which is the wholesale rate my REMC buys from Hoosier Energy. Of course I have to buy the power back at night at $0.13kWH. That's called Net Billing and I think it is fair. I consider the difference as my cost to use the grid as a hugh unlimited battery.

[azdave]

In Arizona with SRP I get paid about 1/4 of what it costs me to buy and that is fair since it is the same price they pay to buy it from other power plants. I would not expect them to pay me anywhere near full retail for the excess I produce. How many businesses succeed reselling their product for the same price they paid?

[J.P.M.]

Fair is a moving target that also varies with opinion.

[veritass]

Huge guestimate, but I would say the fair wholesale rate is .75. With batteries getting cheaper Utility companies will have to pay the fair price or they will lose customers. In 5 to 10 years, utility will have to pay customers the fair price.

[Amy@altE]

Maine Public Utilities commissioned a report to determine the value of distributed solar power. It is a very complete report, taking several variables into consideration, including both avoided market costs and societal benefits. It determined that the first year value was $0.18/kWh and long term value was $0.33/kWh. This may be helpful to you, you are not far from Maine.

http://www.ripuc.org/eventsactions/docket/4568-WED-Ex6-MaineSolarReport(11-23-15).pdf

[bcroe]

Here in NW IL the POCO doesn't pay me anything for power I generate. They just give me KWH credit, which I use at night or other
seasons. If I have a surplus credit at 1 Apr true up, they get to keep it for free. I am very happy with this, as I'm not in the power
generating business, and I get full credit for generation, as opposed to selling at one rate and buying at another. I could even be
happy if I only got say 95% credit for generation, as an operational "fee". A little more generation would cover that. I would not be
happy with any charges added to my current bill, which isn't zero even with no energy purchased.

I don't see this as a cost to the POCO. They deliver the same energy either way (but I'm not buying propane). However
I help by supplying at peak time (running all my neighbors air conditioners), so the POCO delivers the energy at a minimum
load time (to heat my house winter nights). Win-win. Bruce Roe

[nothungry3]

Here's what is fair in Indiana.....at least if you are part of the privately owned REMC network in Southern IN.


Any excess power that I produce I am paid $0.07kWh which is the wholesale rate my REMC buys from Hoosier Energy. Of course I have to buy the power back at night at $0.13kWH. That's called Net Billing and I think it is fair. I consider the difference as my cost to use the grid as a hugh unlimited battery.

Do you pay a separate line fee?

[DanS26]

Do you pay a separate line fee?

Yes, $37 per month. I had to oversize my system to cover all costs. My cost of production is $0.03kWh. I true up with the REMC once a year in March. Last year I received a $350.00 check and no out of pocket costs for power. I use around 12,000 kWh a year and produce around 24,000 kWh a year.

Being a low cost producer is the only way to make this work on a net billing system. If I had to pay someone to put up my system it would not have been financially feasible.