Utility Monopolies Drive Up Our Energy Bills. How Some Floridians Create Their Own Power To Save Money | Opportunity For All Floridians

Utility Monopolies Drive Up Our Energy Bills. How Some Floridians Create Their Own Power To Save Money

At Opportunity For All Floridians, we care about your pocketbook and support policies that benefit consumers, not big corporations, or in this case monopoly utilities. We are excited about renewable energy because it can help consumers save money over the long term. Renewable energy (from sun, wind, water, geothermal) has the potential to help us reduce costs–which is pretty damn exciting. Some major utilities are transitioning to renewable energy, which will eventually save consumers money. Some Floridians aren’t waiting around for that. They’ve decided to go independent and generate their own power. Are they going off the grid? Just the opposite, they are selling their energy back to the grid, saving themselves money in the long term. We’re talking about a concept called “net metering.”

Net Metering: What is it?

Net metering is not a new concept. The world’s first net-metered connections occurred in 1979, in Massachusetts, when 28-year-old architect and solar pioneer Steven Strong put solar photovoltaic (PV) panels in two building projects, a 270-unit apartment complex called Granite Place with a 5-KW system added on, and a Department of Energy–funded solar house called the Carlisle House with a PV system integral to its design

Fig. 1. The Carlisle house.
An image of the Carlisle House from architect Steven Strong’s 1981 paper explaining the concept of net metering. Entitled “The Carlisle House: An All-Solar Electric Residence,” the paper explained the concept of net metering like this: “The solar photovoltaic array produces DC current that is transformed to AC power in a utility-interactive inverter connected to the utility service. When the sunshine provides more electricity than the house requires, the energy is fed back into the utility lines for use elsewhere. When there is little or no sunshine, on cloudy days or at night, the utility furnishes power for the house. There is no on-site electrical storage. The array is sized so that, on a net basis, most of the annual energy for the house comes directly from the sun.” We call this net metering.

Net metering is a billing mechanism that credits property owners for the electricity they produce and transfer to the grid. And when there is little or no sun, the property owner draws energy from the grid to supply their needs. Net metering involves specialized equipment to monitor both electricity consumption and production. The contentious aspect of this practice arises from the production credits that homeowners earn, which has led to disagreements between property owners and utility companies. When state regulations allow property owners to receive a fair rate for the energy they produce, it allows them to recuperate the costs of the solar panels far faster. As renewable energy technology advances, a greater number of property owners can buy the infrastructure needed to produce electricity, and potentially more than they consume.

Net metering has become contentious because regulated utilities don’t want to lose revenue. Since power utilities are a regulated for-profit industry, in Florida, they are allowed to earn a profit when they build infrastructure. That means the utility leaders have an incentive to build new infrastructure or refurbish their existing infrastructure. They make money when they can justify building more power plants to meet increased demand. That is at odds with property owners who install solar systems. Utilities in many states have lobbied legislators to reduce or eliminate net metering so they can protect their profits at the expense of property owners. Below we will recap many of the benefits of renewable energy and net metering rules.

Michelle Vigil (left) purchased rooftop solar from Steve Rutherford with Tampa Bay Solar. A proposed change in Florida’s net metering program in 2022 could have affected her investment, experts say. (Spectrum Bay News 9/Mitch Perry)

Pro consumer net metering rules are crucial

Net metering requires tracking the electricity you generate against what your property consumes. When the numbers work in your favor, you can reduce or even offset your energy bills. As solar panels become more affordable and durable, they could even become a source of income. The crux of the matter is the rate at which property owners are credited for contributing excess energy back to the grid.

Imagine you’ve invested $20,000 in a solar system, and the utility company charges a retail rate of $1 per kilowatt-hour (KW). You’re mostly away during the day, so your home produces more energy than it uses. At night, your system is tracking how much energy you consume. By the end of the billing cycle, let’s say you’ve generated 100 KW and used 50 KW. Naturally, you’d expect to be credited for the excess 50 KW at the retail rate.

Currently, Florida’s net metering rules would support this expectation. However, utility companies have been pushing for legislative changes to lower these credits. In 2022, a bill was passed but later vetoed by the Governor that outlined a ‘glide path’ for reducing these credits. Under this proposed glide path, the credits property owners earn would have systematically decreased from 100% down to 75%, then to 60%, 50%, and eventually to wholesale rates. This phased reduction was framed as a way to share the burden of grid maintenance costs.

Utility companies argue that the reduced credits would help cover the grid’s operating costs, which they claim are not fully covered by solar owners. Solar owners counter that the monthly flat fees they already pay to utilities are sufficient to cover their share of grid maintenance.

Solar provides price stability versus natural gas price fluctations

Seventy-five percent of the electricity plants operating in Florida rely on natural gas. In 2022, Floridian’s electricity bills jumped as natural gas prices skyrocketed across the globe due to the war in Ukraine. Solar in Florida is a reliable and stable energy source.

Security and resiliency

The FBI has warned that physical infrastructure attacks are on the rise in the United States by extremist groups, both foreign and domestic. Whether the grid attacks are physical or digital, they can disrupt our lives. Solar and wind allow us to create microgrids and lessen the impact of widescale outages. Microgrids would also be very beneficial for those who live in remote areas or are vulnerable to damaging storms, like hurricanes.

New technology favors the private use of renewable energy

New advances in renewable energy like solar and wind are accessible to small property owners. Tesla and GAF have produced new roofing systems that will harness the power of the sun and replace the traditional tile, asphalt, and shingle roof systems. Within the next decade, these solar roofing systems will be widely available. If net metering rules favored property owners, we could see a huge switch within the residential markets.   

Reduced strain on the power grid

Extreme weather can wreak havoc on America’s power grid. By allowing property owners to generate electricity, net metering reduces the strain on the power grid during peak usage times. This can help to prevent power outages and blackouts.

Improved reliability increases property value

The renewable energy products market is growing rapidly. The products are becoming far more efficient, cost less to produce, and last longer. Particularly in Florida, an energy-independent home can be far more valuable as hurricanes increase due to warming oceans. As car manufacturers move toward electric vehicles, property owners need to think about setting up their homes for the future. Solar, wind, and battery storage systems are an investment, and we all want to recuperate the cost of investments. Homes with net metering systems can be more valuable than those without. This is because they are more energy efficient and can save property owners money on electricity bills.

Easy to set up and scalable

Setting up a net metering system is relatively simple and can be done by a qualified electrician. Once set up, it requires little maintenance, making it a hassle-free option for property owners. Once you have the meter in place, you can scale your renewable energy system. So maybe right now, you just have a small solar panel that charges your car, but in 10 years you may need to replace your roof and decide to go with a solar roof system– no worries, the metering system is completely scalable.

In order for the math to work in the consumer’s favor, we need the utilities and Florida legislators to listen to us and support “net metering.” Property owners have the opportunity to produce their own electricity on private property and financially benefit from it. It’s important for property owners to recognize this opportunity and advocate for policies, like net metering, that support it.

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