Orlando Utility Commission Whacks Solar Customers, and Slaps Ratepayers

 PeakSHIFT? More Like Peak … Well, You Know

The Orlando Utilities Commission (OUC) must have been feeling bold when it approved the PeakSHIFT program – a set of rules that, despite its lofty goals of modernization, reliability, and sustainability, looks like a direct slap in the face to Florida’s rooftop solar customers and their neighbors. Yes, you read that right: neighbors.

Let’s start with the hilariously skewed math of rooftop solar. When a homeowner with solar panels produces more power than they use, that clean, sunshine-born electricity flows directly to the next available need – typically the neighbor’s house. What does the neighbor pay for that energy? The full retail rate, of course, at about $0.11 per kilowatt-hour. Sounds fair, right? But here’s the kicker: the homeowner who provided that power is only paid back $0.04 per kilowatt-hour, the so-called “production cost” rate.

Essentially, rooftop solar owners are subsidizing their neighbors while OUC pockets the difference. Sweet deal – for the utility.

The Problem with PeakSHIFT

The newly minted PeakSHIFT program has three “innovative” pricing designs:

1. TruNet Solar: Starting in 2025, new rooftop solar customers will get reduced export credits. So, if you’ve been dreaming of solar, congratulations – you can now save even less!
2. DemandLevel: This adds fixed charges based on peak usage because nothing says “save energy” like penalizing you for using your AC during a Florida summer. (This could apply to all customers.)
3. Shift & Save: Encourages off-peak energy use. A great idea if we’re all willing to sleep through the sweltering midday heat and do laundry at 3 a.m.

But here’s the rub: Florida’s power demand spikes during the day – when rooftop solar is producing at its peak. That’s when utilities would otherwise have to rely on “peaker-power,” which costs a fortune compared to base load power. Rooftop solar dramatically reduces this need, saving everyone money. Yet somehow, instead of rewarding these solar heroes, OUC’s PeakSHIFT feels more like a punishment.

And let's not ignore the four-letter word some people use to describe PeakSHIFT. It might rhyme with a certain expletive – and it's not hard to see why.

Who Really Benefits from PeakSHIFT?

Spoiler alert: It’s not the environment, the solar industry, or Florida homeowners. The real winners are the utilities, which get to maintain control over energy production while sidelining rooftop solar. Solar installers are left scratching their heads as they try to sell systems with an extended payback period, and homeowners are discouraged from investing in clean energy because the financial incentives are dwindling faster than an ice cube in July.

It gets even better (worse). By imposing these new rules, OUC effectively shifts the burden of expensive peak power production back onto the grid, conveniently ignoring how much rooftop solar offsets those costs. Meanwhile, solar customers are asked to play ball in a rigged game.

The Double Standard

Here’s the irony: utilities rely on daytime solar power to avoid firing up costly peaker plants, but they still charge full retail rates to neighbors using that power. It’s as if rooftop solar customers are running a lemonade stand, only to have the utility swipe the lemonade and sell it to someone else at triple the price.

This is not just bad policy – it’s comically transparent profiteering disguised as a modernization effort.

The Incentives Are Broken – And They’re Breaking Us

Florida’s power companies operate within a system that rewards them for building, not innovating. Utilities are effectively paid based on the size of their investments and assets under management. The bigger their portfolio, the more profit they rake in – above and beyond the actual cost of those investments. And guess who foots the bill? That’s right: every ratepayer.

A prime example is the introduction of Demand-Level Pricing, a concept historically applied to large commercial entities with significant and erratic peak power usage. Applying this to homeowners, particularly those with rooftop solar, creates an unnecessary and confusing layer of cost management. This system essentially forces homeowners to absorb the utility’s grid balancing burden by either limiting their usage during peak times or investing in expensive battery systems to smooth out their power draw. In essence, new solar customers are expected to perform “power leveling” on behalf of the utility, ensuring grid stability while being charged for the privilege.

Ironically, OUC might even expand demand pricing to all customers, effectively ensuring that all the solar power produced during the day – when demands are highest – is supplied to the microgrid for free. Meanwhile, OUC could still charge customers peak rates for that very same energy, making rooftop solar power a direct subsidy to the utility’s profits.

This warped incentive structure drives utilities to clear vast tracts of land – 500 acres or more – to build massive solar power plants, rather than using existing impervious surfaces like rooftops or parking lots. These utility-scale projects qualify for the same 30% tax credit and depreciation tax shields as rooftop solar, but they also allow the utilities to pad their bottom line with even more capital investments. It’s a sweetheart deal, where utilities make money twice: first on the tax incentives, and then on the guaranteed returns from their growing asset base.

Meanwhile, taxpayers and ratepayers are left footing the bill for this inefficiency. The Florida Public Service Commission and municipal utility commissions, like OUC, often seem more aligned with protecting the profits of local monopoly power companies than with serving the public interest. This isn’t surprising when you consider that many regulators have held – or hope to hold – cushy jobs with the very monopolies they’re supposed to oversee. It’s a cozy arrangement for the utilities, but it leaves Florida homeowners, small businesses, and the environment paying the price.

And, if you think this Goofy Power SH**T is only happening in the Magic City of Orlando, think again. It is happening in California, Luisiana, Florida, and cities everywhere like NYC and throughout Texas.

A Message to OUC

Dear OUC, we see what you’re doing. And, we have to admit, the boldness is almost admirable. But please don’t pretend that PeakSHIFT is about sustainability or fairness. If it were, you’d be paying solar customers the same rate you charge their neighbors. You’d also acknowledge that rooftop solar is not the enemy but a partner in reducing peak energy demand and combating climate change.

Instead, you’ve delivered a program that penalizes those trying to do the right thing while protecting outdated utility profit structures. Bravo.

The Takeaway

The PeakSHIFT program is a masterclass in how not to encourage clean energy adoption. By undervaluing solar production, overcomplicating pricing, and alienating potential customers, OUC has turned what could have been a forward-thinking policy into a punchline. The only thing they are modernizing is their PR spin, and what a whirlpool of miss-information it is.

Florida deserves energy policies that reward innovation and collaboration, not confusion and disincentives. Maybe next time, OUC can aim for solutions that genuinely reflect the spirit of modernization – not just a power grab and siphoning off rooftop solar profits.

By Elmer Hall (2024, Dec. 12) with assistance of ChatGPT 4o, Perplexity.ai, Gemini Advanced and DALL-E for graphics.

#RooftopSolar #RenewableEnergy #RE100 #Solar #REInvestmentTaxCredit #SustainZine #PerpectualInnovation #SBPlan #OUC #PeakSHIFT #NetMetering

#GenAI #rdAI

By Elmer Hall (2024, Dec. 12) with assistance of Perplexity.ai, ChatGPT 4o and Gemini Advanced. Abstract surrealistic artwork inspired by Salvador Dalí's style, depicting the transformation of rooftop solar adoption over time in the central Florida sun. DALL-E (2024, Dec. 12) with prompts by Elmer Hall.

Elmer Hall, DIBA, is President of Strategic Business Planning Company.  SBP develops plans that every organization needs(tm): startups, nonprofit, sustainability, and patent commercialization.  Dr. Hall has published several books and has been a professor of business (DM, DBA & MBA) and Management Information Systems (MIS). With his latest Perpetual Innovation™ books on Rapid Strategic Planning he is using Regenerative Dynamic AI (rdAI) and the motto: Plan Fast, Act Smart, Make a Difference!™

Solar with Batteries vs. Generator: A Cost-Benefit Analysis

In the realm of backup power solutions, homeowners and businesses often find themselves choosing between traditional generators and modern solar systems with battery backup. While both options provide energy security during outages, their long-term costs and benefits differ significantly. In this case we are looking at a larger, whole-home sized generator and comparing it to a solar system that produces as much or more power. See table below for comparison of costs, savings and benefits.

Earth Day: Drawdown & GAI

 What does GenAI have to say about the scientific-based solutions promoted by Project Drawdown? ProjectDrawdown.org (Another take on Earth Day using GAI.)

We employed our fav GenAIs to chat about Project Drawdown. This is the overview with the prompts. Please feel free to run GenAI chat with your own queries.

Q: Project Drawdown looks at the biggest places to make the greatest impact toward reducing human impact on the planet. What are the most impactful of these?

Q: What are the ways that someone of average income in the USA could make the most impact based on these top 10 solutions?

Update to Sustainability WikiBook (Using the power of Generative AI)

It's been a while since the Perpetual Sustainability(tm) wikibook has been updated. The idea behind the book was that people could link through on each sustainability-related topic and find up-to-date information on the topic as only Wikipedia can provide -- the genius of crowdsourcing. We let ChatGPT 4.0 work on an update (and the graphic). What do you think?

YOU Q: Please generate an outline improved from the one attached that includes hyperlinks to each topic. Where appropriate include links to quality Wikipedia articles. Also, please utilize the WikiBook outline with Wikipedia hyper links by Hall from: https://www.sustainzine.com/p/sust-wikibook-links.html

EV v ICE, What's the Price?

 Every couple months something pops into my news feed or email about how bad or expensive Electric Vehicles (EVs) are compared to the olde Internal Combustion Engine (ICE machines).  (See cartoon from Yale Climate Connection Don't be fooled: Electric vehicles really are better for the climate.)

One that popped up was from a very biased web site (can't call it a magazine or journal). The cost for EVs to operate were $17 per gallon, equivalent. It relied on an actual study, and then changed out all the facts.

Renewable Energy and IRA 2022

Quick take for Inflation Reduction Act 2022

The Inflation Reduction Act is a huge legislation act passed in 2022. It includes increases in taxes (mostly corporate related), limits to some spending (like drugs), and a lot toward energy efficiency and renewable energy. See the overview on Wikipedia: https://en.wikipedia.org/wiki/Inflation_Reduction_Act_of_2022

Renewable Energy Incentives. The IRA has raised and extended the 30% investment tax credit to qualified renewable energy investments. There are many limitations and additions. Look for updated blogs here and get informed from the IRS and Treasury. 

Solar Prices Dropped off a Cliff and Into the Ocean

Here's a great article in Clean Technica by  Zachary Shahan on the falling prices of solar (PV). The cost per watt is the key measure to follow. Basically a rule of thumb is that $3 per Watt installed should be profitable, before any tax credit considerations. In 2006 the cost was $3.50 per watt for the panels. Now prices have dropped below $0.50 and would be lower if there wasn't a trade tiff going on with China.  Even with $1 to $2 per watt installed, the prices are getting to be crazy low. The Investment Tax Credit dropped to 26% percent in 2020 and will drop to 22% in 2021, but the installed costs after tax benefits should be less than $2 per watt. That's a crazy profitable investment, especially for businesses. (See our discussion and  Solar Calculator on the residential and business PV investments.)

Solar Investment is Crazy Profitable for Businesses and Good for Homeowners

[Update. The Inflation Reduction Act 2022 has raised and extended the 30% investment tax credit to qualified investments. There are many limitations and additions. See our Blog post here. This makes all the financial discussions below much more profitable. Also, higher inflation and higher power inflation. The below Article was originally published in Summer of 2020.]

 

SBP has done several detailed financial calculators for analyzing both residential and commercials solar projects. SustainZine has a main web page on Solar Profitability where we discuss examples from our Solar Profitability Calculators: https://www.sustainzine.com/p/solarinvest.html ... Here are articles – and YouTube videos – discussing both:

1. Quick Take on  Residential Solar: Solar Invest 2020: Do Good and Save Money Too … See the video related to Residential here: Solar Residential: Good Investment & Doing Good
2. Full Financial Analysis: SolarInvest2020: Residential Solar is Good, but Commercial Solar can be Crazy Profitable! … See the video related to Commercial/Business here: Solar for a Business can be Crazy Profitable: Do Good by Doing Well

YouTube Video on Residential: Solar Residential: Good Investment & Doing Good https://youtu.be/p0pqg4ZeTjY

Dr Elmer Hall talks about the doing good and making money at residential Solar. He discusses that subtilties of the financial analysis for a homeowner, and why it typically is a far better decision than a typical profit analysis would suggest. #SustainZine #Solar #RenewableEnergy #SBPLan

YouTube Video on Commercial Business: Solar for a Business can be Crazy Profitable: Do Good by Doing Well https://youtu.be/ulryBkhsKWg

Dr Elmer Hall talks about the doing good and making money by a business installing Solar. He discusses the financial analysis for a business and why it probably is such a great investment. The investment for businesses has huge tax savings. Plus, the money to pay for power to operate the business is already committed if the building is used. This is Part 2: See part 1 related to Residential as well. #SustainZine #Solar #RenewableEnergy #SBPLan #Profitability #CrazyProfitable 

IntellZine: Big winners of Renewable Energy -- IP and Manufacturing

Here is a June 7 2020 post over on IntellZine, our Intellectual Property-centric bog. The blog post was about Renewable Energy patents an how much they have expanded, especially solar IP.

Here is the Big winners of Renewable Energy: IP and Manufacturing article.

As you look at the companies that are winners in Renewable Energy (RE) you have distinct winners (and losers, especially in the fossil fuel world). But there are entire countries that stand to win as well. Several countries have become exporters of energy, for example, when they produce more regional energy than they can use. I like the image set related to 25 areas/countries that are winners in Renewable Energy (at LoveMoney.com, The world’s greenest nations that are reaping the rewards). Here’s Love/Money’s take on China, both in terms of the technology (Intellectual Property) and the manufacturing/exporting:

“Of all patents for renewable energy issued globally, as of 2016 China has 29%. That's more than 150,000 patents, which underlines the focus of China's investment in the industry. So it's not a shock that the country has been dubbed a “renewable energy superpower” in a recent report issued by the Global Commission on the Geopolitics of Energy Transformation. The report argued that, as renewables come to fossil fuels globally, new energy leaders will emerge.”

The US had only 100,000 patents (vs 150,000 for China) and Europe had 75,000 in renewables according to the Forbesanalysis in Jan 2019.  Overall, patents in renewables has made impressive progress, even though RE patents are only 1% of all patents (and other high-tech categories like computers are about 6%). Check out the great article at the World Intellectual Property Organization (WIPO) on RenewableEnergy patents by James Nurton. More than half of the RE patents through the Patent Cooperation Treaty (PCT) are in solar. Fuel Cell technology has consistently exceeded Wind in terms of patents. Fuel Cell (using hydrogen) is important because it can function as battery, battery backup, stationary power and portable power. Geothermal is trivial are of RE patent activity. When the RE “international” patents (PCTs) are registered at the national level the first three countries are: Japan, USA, and Germany.

On the manufacturing/exporting side, China has been a huge producer of the world’s renewables (solar, wind and more). Here’s how LoveMoneysummarized Chinese production of RE:

 “China is currently the world’s largest exporter of solar panels, wind turbines, batteries and electric vehicles. The country is well-suited to wind power production, and it has an estimated potential capacity of 2,380 gigawatts. What’s more, many Chinese companies are investing in renewables.”

Keep in mind that many things sustainable are lower tech, not higher tech. Much, if not most of sustainable solutions does not require break-through solutions. Using less energy can be very low tech (turning the lights out when out). Driving less (by telework) can be no tech. But in the cases where leading tech can be a major competitive advantage, he owners of IP will win.

Look also at GlobalTrends in Renewable Energy Investment in 2019 by UN Environment Program and Bloomberg. Where is RE coming from? The investment from 2010 through 2019 has been $2.6T with 52% in Solar and $41% in Wind.

And the final question: how do we get to 100% renewable energy in a reasonably short period of time?

#RenewableEnergy #REPatents #IntellectualProperty #IntellZine #SustainZine #WIPO #Sustainability #PCT #REInvestment #Solar #Wind #RE100