Iowa farmer says he’ll remove solar if co-op’s $85 fixed charge stands

A small rural electric cooperative in Iowa has informed its 3,000 customer-members that, should they install solar panels or other distributed generation, they will pay what appears to be one of the highest monthly charges in the nation.

Pella Cooperative Electric sent out a notification on June 18 alerting customers that the “facilities fee,” which is the fixed part of the monthly bill, will triple from $27.50 per month to $85 per month – but only for customers with solar panels or another source of their own generation.

“I think it is unlawful, and I think it’s outrageous compared to any other RECs (rural electric cooperatives) that I know of,” said Mike Lubberden, a Pella-area resident who, for the time being, has ditched his plan to install solar panels. He is seeking legal representation and intends to file a complaint about the matter with the Iowa Utilities Board.

“I’m hoping to get them to back down on this $85 charge.”

Pella’s announced charge is “definitely an extremely high fee,” according to Amy Heart, the senior manager of public policy for The Alliance for Solar Choice. It appears to be one of the highest in the Midwest. Heart noted that Rock Energy Cooperative in Janesville, Wisconsin recently adopted a monthly charge of $22.60 per kilowatt, which likely would amount to about $90 a month for a typical residential solar array.

Utilities and co-ops around the country are seeking to increase flat fees that are assessed on customers’ bills, saying ratepayers who generate their own power aren’t covering their share of the costs of maintaining the grid. Advocates say this approach fails to account for the full value of distributed solar.

Pella’s board of directors decided to hike the fee for distributed generators on its system after it did a “cost of service” study, something it does periodically “to make sure the cost-causer is the cost-payer,” according to John Smith, the co-op’s chief executive officer.

The study concluded that customers who generate some of their own energy – there are now 12 of them in Pella’s territory – are not paying their share of the co-op’s costs to maintain and operate assets such as poles and power lines and transformers.

Smith declined to allow Midwest Energy News to review the study, saying it is “confidential” and “not subject to distribution.”

Although there is a fixed portion of the bill that is designed to cover fixed costs, Smith said it doesn’t really do that. The co-op actually looks to the variable part of the bill, which reflects the amount of energy used, to cover some of the fixed costs, according to Smith. Therefore, a customer-generator, by using less power, also pays less towards maintaining the entire transmission and distribution system. How much less? $57.50 per month less, according to the coop’s calculation.

By hiking the fee paid by the system’s distributed generators, Smith said, the coop is “protecting the rest of the ratepayers to make sure they don’t pay costs unfairly.”

Michelle Wei, a solar installer in the Des Moines area, dismissed that as “total nonsense,” and said that the increased fee likely would exceed the total monthly bill of many customers.

In his June 5 bill, for example, Lubberden said there’s an “energy charge” of $83 – less than the $85 fee the co-op is proposing.

The co-op is giving its current customer-generators five years before they have to pay the higher fee. That applies also to anyone who can get a system operating by Aug. 15. Anyone installing a system after that date will be required to begin paying the $85 monthly fee immediately.

Bryce Engbers, whose hog-confinement operation accounts for three of the 12 distributed generators now on Pella’s system, said that he’s done the math and foresees removing the solar panels on his home and his two hog barns before mid-August, 2020. He anticipates that his son will also remove his solar system.

Last year, Engbers said, the 3.5-kilowatt system on his home produced about 5,320 kilowatt hours of power. At 12 cents per kilowatt hour, that’s a savings of $638, he said – compared with the $85 monthly fee, which over the course of a year would amount to $1,020.

“As you can see, this fee makes my home system absolutely and totally worthless,” he said. “In fact, I will have them de-install it, or I will be losing $400 a year.”

He has scheduled a meeting in a couple of weeks to discuss his concerns with the co-op’s board of directors.

“I’ve informed them that they’re in violation of Iowa Code 476.21.

It states: “A municipality, corporation or co-operative association providing electrical or gas service shall not consider the use of renewable energy sources by a customer as a basis for establishing discriminatory rates or charges for any service or commodity sold to the customer or discontinue services or subject the customer to any other prejudice or disadvantage based on the customer’s use or intended use of renewable energy sources.”

Although the arrays on his two hog barns perform better, Engbers said, “In 2020, all of my systems will be shut down, even my 10K systems. The advantage is going to be so small that the savings won’t be worth keeping them running, unless we have battery storage at that time….in which case I’ll double all my systems and keep that energy in a battery. And I’ll be using even less of [Pella’s] energy.”

80 thoughts on “Iowa farmer says he’ll remove solar if co-op’s $85 fixed charge stands

  1. The problem is net metering. If you want to generate your own power by solar and NOT put the excess back on the grid at a much higher cost than the utility can purchase it for, than yes you should have a more reasonable facility charge. However, if you net meter, those that have solar are being subsidized but those who don’t. Translation: Rich people can force poor people to help them pay their electric bill.

    • this is not how the rich stick it to the poor. This is how a utility company uses its monopoly to force you into paying, regardless if you use them or not. By generating solar, you either a: use less electricity from coal or nuclear or whatever feeds the current grid or b: you put power back on the grid for others to use, lowering the required electricity from the power source. Neither one of these costs the utility more money. What it does is cuts into their profits. If I decided tomorrow to stop using my a/c it would cut my bill in half. Does that mean they could then come to my house and order me to turn my A/c back on or pay a surcharge? No. That’s not how it works.

      • Interesting, it is a member owned coop and the board directors will not separate out the costs related to infrastructure vs KWH hour usage. That smells fishy. The members should demand costs are broken out.

      • A utility will not order you to turn your A/C on but they still have to pay fixed charges (trucks, wages, infrastructure, poles, etc.) no matter if you use it or not. The utility in question is saying if you wants to be a power supplier to your neighbor you are going to have to pay for the lines you are using to do it. The reason the facility charge has been traditionally lower than it should is because of low users on fixed incomes. The rate structure is about to change for all utilities because as I said, the solar people want money from their investment and their neighbor who doesn’t have it is going to have to pay.

  2. Can’t wait until battery technology catches up so generators can disconnect from the grid entirely.

    • Battery technology has been developed, and can be done on a large scale. They just have to make it available, its coming very soon.

    • In many states it is ILLEGAL to be disconnected from the grid. Your certificate of occupancy requires a grid connection.

      • simple solutions to this, install a bypass switch. just like being hooked up to government water a simple Y connector allows you to turn off that water and use your water instead. all leaving you hooked up to the system.

        • Such connectors for water are illegal you cannot have well water lines connected to a public water line in any way.

      • Even in those states, you don’t have to hook the grid up to your electrical system. Attach the meter to a dummy breaker box holding one breaker for one light.

    • Nice idea, but it’s not going to happen in your life time. Where is our energy Czar? This is a complex problem! All alternate energy systems still rely on the grid. Until they are self sufficient they will not be viable! If you want to go off the “Grid” be prepared to take of your own needs!

      • Baloney! I know PLENTY of people that are TOTALLY off grid. For the few times they need more than the solar installation can provide, they have a diesel generator.

    • And that is where I am headed. The sooner I can disconnect from these idiots the better. The public started public power with a great mission. They have now transformed into a group of good ole boys focused on their monthly free dinners.

  3. I am not sure what the right fixed fee is, however, clearly Solar customers are benefiting from the infrastructure that utilities and their customers pay for. All of the transmission lines, substations etc… have to be built and maintained. Honestly, I think the solution is that Electricity needs to be divided into Infrastructure and Power Generation. Everyone would pay an equal flat fee for the Infrastructure. Solar customers then would only buy whatever electricity they need to supplement their solar power generation which in some cases would be a negative number (excess power generation that was put back onto the grid). If a solar customer wants to truly be independent of the power company then they need to go off grid but of course that means not having power all of the time unless you invest in some very expensive battery technology.

      • Just inquire as to how much they would charge to bring power from an established line (nearest pole) out to your most remote location say a mile or so. Most companies will charge around $500 – $1,000 for each pole they have to install. Most folks bought solar based on the idea that the power company would pay you back for each Kilowatt you returned unused. … At The Same Rate They Charge YOU. They have a $0.03/KW generation rate. They can buy excess power from the next county for $0.04/KW. They charge a ‘transmission Fee and a maintenance fee’ and bump up the cost per KW to where you pay between $0.10 to $0.25 per KW consumed. They feel they should pay you back at lower than their own generation costs. AND YOU should still pay for everything else ,, by allowing you to deduct $0.03 per KW that you feed back to the grid. So Buy a Battery for $3,000 and flop the breaker every day.

    • This seems a highly appropriate solution for most residential users in most cases. However, if businesses — including farms — need more robust infrastructure for any reason then they need to pay for that themselves.

    • Randy, that is how it works for us now. There is a standard flat fee facilities charge that is supposed to cover the lines, etc. and a per kw hour charge for electricity used. But the co-op here is only wanting to increase the facilities charge for the solar supplementing customers. They are just upset because the solar supplementers are now using less electricity. The net meter was a requirement from the co-op for the electricity to be able to be billed accurately because most meters cannot read the electricity use going back to the grid. Here in the Midwest, which is where the co-op in the article is, it is almost impossible to “make money” from the electric being put back into the grid because there simply are not enough hours of sunlight to produce that much energy, especially if they are running a farm. We have been solar supplementing our electric for about a year and have never had a negative bill.

    • The batteries are the least expense part of an off the grid setup. My house is 100% off the grid; there aren’t even power lines on my property. Having just replaced my panels, batteries, charge controller, and inverter the cost of the batteries was only about 1/4th of the total bill. With my setup I can usually go about 4 full days without any sort of sun or supplemental charging. At that point I just fire up my generator for a few hours and top off the batteries.

      • Jesse, would you be willing to chat with me about your set up? We are building next year and planned on going partial solar. Now I’m considering 100% solar.

    • Actually, Solar Power providers are doing a great service FOR the power industry. Why you might ask? The reason is as follows.

      Maximum power consumption on the grid occurs during the daytime – exactly the same time as when these solar arrays are putting out their maximum power. By having these systems online, the power company does not require as much “Peak Power” as they would otherwise. Anyone who knows about power on the spot market knows that peak times command peak prices.

      By having their systems online they are helping SMOOTH out that demand curve.

      This is just an example of money-grubbing power companies trying to screw over those who are not paying them as much as they ‘d like.

      How they can EVERY justify a fee that is GREATER than the amount they pay if they are actually connected is beyond ludicrous. I hope some judge hauls their ass into court and makes them explain the economics of that situation and tells them that if they cannot adequately explain it and fail to remove it that they will all be individually fined TEN TIMES the cost of that for each customer they charge! Let them see how THEY like it!

    • The 27.50 was already the charge for that. The rest of your bill was based on usage. Now that a solar panel user is LESS dependent on your infrastructure, you want to charge the, 3x as much? Not fair in the least. I’m an electrician, I know how it works. And I assure you the only thing that solar panel is affecting is this companies bottom line. I hope solar put them out of business.

      Say I mow your lawn weekly, and it grows year round. I charge 9 bucks each time with a 1.00 fuel surcharge. You decide you can mow it yourself every other week so tell me to just one back 2x a month instead. I give you your new bill, now it’s 9+1 bucks, with a new 20 dollar per month customer acquisition fee. I only waived that fee before because you used me regularly. But I still want my money so…

    • You might want to look up the term “co-op” They aren’t for profit.

      • Is that necessarily so? Co-op = cooperative effort or operation. Doesn’t necessarily mean not for profit.

      • Electric cooperatives operate at-cost and are indeed not-for-profit organizations. Whatever profits are generated each year is distributed back to members over time in the form of capital credit checks.

        I believe Randy is right in that the solution is divided Infrastructure and Power Generation charges for everybody, and I believe that is the way it will have to be for most cooperatives in the near future as distributed generation (DG) becomes more common and affordable. It will be hard to transition and tell the other near 99% of cooperative members who do not have solar that they now have to go to a higher infrastructure fee because other members are putting up distributed generation…but that is fair. People are just used to the way the system was set up, which was fair in its time. Now that the system is changing, I believe this will be the new, fair way to do it so consumers without DG are not covering the infrastructure costs of those who do have solar units.

        • Any Coop is a for-profit entity. The members are the shareholders and the excess-over-operations are the profits, typically call a patronage dividend and are taxable as income. Operates pretty much the same as an S-Corporation…the profits flow through to the owners, but they are definitely a for-profit entity. Non-profits are tax-exempt and retained earnings are kept within the entity and not taxed. The term Co-op has acquired some viral connotation as being morally superior. They aren’t.

  4. Why is it that these fees of maintaining the grid are quite often higher than the original electric bill had they not installed solar?

    The grid maintenance fees are WAY too high. Especially in the cases where electricity is being fed back into the grid.

    • Yea – that just does not pass the sniff test. These FEES cannot and should not be allowed to be greater than the friggin original bill!

      IDIOTS… Those are the kind of people you’d like to see in a dark alley sometime.

  5. Since when did the utility companies take ownership of the sun and the energy it produces. Their claim that people who generate some of their own power are not paying their fair share of the grid maintenance. That’s BS! Follow me on this: Homeowner A uses 1 megawatt of power from the grid each month. They are a working family with kids in school. So no one is home during the day. Homeowner B is a retired couple who use 2 megawatts per month. They are home most of the time. The install a 1 megawatt/mo solar system (that’s about a 4500 watt/hr system) to reduce their demand on the grid to 1 megawatt and cut their monthly costs. Now they use the same power from the grid as Homeowner A does. How is it that two homeowners using the same amount of power from the grid are not paying their fair share of the gird maintenance. Seems like Homeowner A isn’t paying their fair share of the grid maintenance either. Damned if you do conserve, damned if you don’t. There’s a reason the study is confidential and not subject to distribution.

    • Pure Simple Logic. Now if the utility company could come up with a logical response to that I would be shocked. Shocked get it

    • Utilities don’t claim to own the Sun or the wind. They do own the distribution network. They paid to build it and are paying to maintain and expand it. Like the rail system you can’t just assemble a train and say I want to go from A to B and jump on the track.

      • So… A FIXED COST for distribution is fine for ALL customers…

        But NOT one that is HIGHER for those with solar institutions.

        Once again, this just does not pass the logical sniff test.

        Something is fishy. I bet the people proposing these fees are somehow tied (i.e. making money) off of the power system or related businesses.

        • The “people” proposing these fees are the board members who were democratically elected by the membership. They live in the service territory that they make decisions for and abide by the same rules.

          Cooperatives are not-for-profit organizations that distribute any end of year profit back to cooperative members over time through capital credit checks. If any of their members have concerns, I’m sure they could sit down with a board member and discuss it.

          I would not doubt an increased fixed cost for all members is in the works. It will just be a big switch, but fair.

          I believe it was originally set up that facility/membership/infrastructure fees would be kept low and the rest of the needed infrastructure fees be recovered through energy consumption so people (lots of rural folks who cooperatives serve) who have an acreage, barn, bin site, etc. wouldn’t have to pay several – $85 (real-cost) facility/membership/infrastructure fees (one for each property location) where they use very little energy – just a security light on a shed or to flick a light on once in awhile.

  6. I so much want to have enough solar that I can tell the power company to come get their wires off of my house. Of course that is a lot of money, but it would feel so good.

    • It’s not that much and a lot of the solar companies do it “no down” with no fees unless the system does not generate enough power… but it is better to buy a system take your tax credits and even if it takes seven years payback it last 25+ with a slowly deceasing efficiency….. (kind of like you will die of old age before it stops working….tend to lose about 2% the first year and a half percent each year afterward… on what remains…)

  7. In reading the article and subsequent comments I just say that the utility is way shortsighted on this, and not because of the facility charge. A reasonable and fair charge for the grid infrastructure is fine as a fixed cost. If the co’op isn’t accounting for that properly then shame on them. But what is missed in all this is that the more solar produced then the less peak power the utility has to purchase. The cost per kWh of peak produced electricity is mind boggling. But the utility is legally bound to keep power flowing. It would seem though an intelligent utility would want to hold the reins in on peak power thereby benefitting all of their customers.

    • Utilities didn’t pay for the grid. It was payed for by the federal government, and is still partially subsidized. So utilities are losing some gravy.

      • In the case of rural systems, especially in the upper midwest, the peak season is the fall, with all the grain dryers on all times of the day. In the winter, it is a double hit per day, you will generally see the same peak as people wake up and go to work as you will when they come home and turn on the lights….sunlight in the winter is usually from about 7:30 am to about 4:30 pm. So, solar, during the top time of the day isn’t really shaving a peak….especially if there is a cloud that flies over and for a few minutes, the solar isn’t producing and the peak on the system increases back to where it would be without solar.

        • Yes! And electric cooperatives still have to have the same capacity and infrastructure investment regardless of DG or not. There will be times when it is cloudy and solar panels are not producing to their full potential and members with DG will expect to be able to then pull power from the grid. They are using the cooperative as a back-up, but the cooperative still has to have the same (full) capacity, equipment, and infrastructure in place to handle everybody at that point in real time.

      • So, did your bank pay for your house, or did you pay it back? The federal government didn’t pay, they loaned the money, which the cooperatives paid back, with interest.

  8. The utility companies are just greedy. Here, they call this charge a membership fee. I asked them if I had service ran to my shed, would I have to pay 2 membership fees, since I am a member already. They said yes, I would.

    Our government has made extortion legal. I can’t wait til Elon Musk has perfected his batteries, so that I can go off grid.

  9. So if you are a customer that uses a significant amount of lighting load – say a warehouse, and you convert to 100% LED and reduce your usage by over 50% will they also add a surcharge? After all your bill will be reduced significantly

    • There is a difference, though, between making changes to being more energy efficient and to having solar. The amount of electricity being produced by solar panels changes in real time. One moment, it is generating at full capacity and 15 seconds later a cloud goes over and knocks the production down by 75%, forcing the consumer to now pull electricity off the grid from the utility. Although solar energy may help some during peak hours, it is also not consistent or reliable in that way.

      Look at it this way – – it’s the middle of summer, a very hot, muggy weekday during business hours. High peak demand. Now, the sky clouds up. The demand is still incredibly high, but those solar panels are not generating anywhere near their potential and all consumers using distributed generation are now pulling from the grid at the same time to supplement what they need, adding a lot of load to the system at the same time.

      Utilities still need to have the capacity and infrastructure built up to cover those using solar for times when their panels are not producing…in addition to their normal load. So although renewable energies may benefit the grid in some ways, they really don’t in terms of capacity and infrastructure because utilities are still expected to provide them with power at any given moment. If a cloud goes over, are those with solar going to be happy if their power goes out or is dimmed for a few minutes, then comes back…on and off all day? (Which is bad for appliances and electronics, not to mention.) Probably not. Utilities are then forced and expected to play “back-up” and hold the same capacity and infrastructure as they would if nobody had solar.

      • “There is a difference, though, between making changes to being more energy efficient and to having solar. … One moment, it is generating at full capacity and 15 seconds later a cloud goes over and knocks the production down by 75%”
        Which is exactly the same in the case where that warehouse owner turns the lights on or off. Variable onsumption is indistinguishable from variable generation, from a grid balance perspective. And just like variable consumption, variable distribution is smoothed out significantly by aggregating many sites over a large service area.

  10. This is such a bunch of non-sense. When we get to 50% solar then probably something will need to be looked at in terms of making sure there is enough money to keep the infrastructure up.

    The reality is that solar pumps energy into the grid when it needs it the most during the afternoon, and then solar owners take power from the grid when the grid needs users the most, at night.

  11. The Electric companies where i live keep telling us we need to conserve and cut back on our use. I believe it is because they dont want to build out to generate more. I also think peak demand is a problem for them because if they build to meet it, they are over built and over producing for a good part of the day. Isnt this where distributed generation comes in to play and actually helps them out? I think so. I know they dont give the solar folks per kwh what the solar folks have to pay when the solar folks have to use the grid. What is see is a greedy company that wants it both ways and only sees customers as their bank.

  12. Instead of charging a fee to cover the costs unreliable generation like solar inflicts on the grid, they should just eliminate net metering which is forcing the utilities to subsidize wealthy solar panel owners at the expense of the poorer members of the collective.

    The Mike Lubberden character is being ridiculous. He is wanting to use the govt net metering policy to fleece his neighbors and when the utility makes him cover the money he wants to take from his neighbors he arrogantly claims he is the victim and starts filing lawsuits.

    Solar is still the most expensive for of electrical generation there is. It is a free country if you want to buy your own panels because you want to be green. Buy your own batteries and don’t connect use the grid, just don’t force the poor to subsidize your lifestyle choices.

    • Actually, distributed solar drastically reduces the cost of power generation by increasing efficiency in the system and reducing costs of power transmission. You tend to lose a lot of cost to transmission depending on scale and how far power has to travel. The recent study done in the Midwest (Minnesota) shows that small 5MW plants are the most efficient at distributing the power because of the lower transmission fees.

      But for small scale operations like the ones on this farm, there is no cost to the utility, as the generation never exceeds usage, so no cost goes to send that power outward. Thus it only works the same as increasing energy use efficiency.

      This utility already separates out the costs, by having a $27.50 a month transmission fee. By tripling that rate only to solar supplementing customers, they are not only violating the law by targeting specific individuals, but are also trying to force them into not using the panels, which decreases their own efficiency, forcing the power company to generate more, usually dirty, energy. This is against both common sense and equal rights.

      No cost is assumed by the utility since they do not need to purchase the solar generation, thus they are only seeing the increase in efficiency of losing less power to transmission. Also, solar is not only already cost neutral to other forms of generation, but is drastically coming down in price as technology advances. So, your already moot point becomes increasingly worthless.

  13. I’m reading the comments about the greedy power companies and their supposed monopoly on the sun and how they are rate gouging consumers above what the normal bill would be if they didn’t have solar power. I’m an electrical engineer and while I don’t work in the power industry I can already see the huge holes in those arguments.

    In the case where you ALWAYS use more electrical energy than your produce the power company doesn’t really have to worry about you or install additional equipment. Unfortunately, sometimes you produce more electrical energy than you consume which puts the power grid into a state that it is not ready. When the excess power is put back on the power grid and the power company doesn’t know or realize that an additional power generation system has come online they can cause serious problems and catastrophes. The destruction of a transformer in this way usually ends in massive explosion which could damage other parts or cause injury. They may also damage or destroy power generation equipment from professional providers.

    The proper way to handle the new power generated by these systems is to treat them like a power provider, meter their power input in the power grid in real time, perform the rate calculations and pay the home-solar-provider current market rates for their power while backing off on importing power from other external sources. Unfortunately this type of power metering and related engineering hours are expensive and what this cooperative is saying is that it should not be the responsibility of everyone else to pay for you to produce a marginal amount of energy safely.

    Ethically, what the cooperative should do is that if you install a sizable solar array and there is a suitable probability that you will not be able to use all the energy that you produce locally and the amount of energy that you produce is small (you are not a professional producer) then you must buy and install special metering equipment which communicates energy production back into the power grid AT YOUR OWN EXPENSE. This would be a one time fixed cost of attaching you safely to the power grid. The cooperative would then bear the cost of upgrading infrastructure so that the power grid was in a state that could handle bi-directional power consumption/production because essentially that is their sole responsibility.

  14. The electrical companies are getting hit from several directions beside solar and wind generation. LED lamps, CFL lamps, lower usage by many appliances. People switching from big hot water tanks to tankless type, and other ways of keeping from using so much electricity. They are targeting those that have went to the expense of installing solar and wind generation to supplement their needs and cutting down on use of the grid. Today it is easy to go off grid and it will get cheaper day by day. Panels have gotten so cheap that they are just about competing with the grid, batteries are getting better and lasting longer, and there are ways to avoid AC and other expensive devices if you only look for them. I don’t agree with them penalizing those trying to save by installing solar.

  15. So how much does the co-op add to a customers bill per month if they replace their incandescent light bulbs with LED light bulbs? How much for people that install a higher efficiency A/C? Using the co-op’s logic, aren’t these people that are using less electricity not paying their share of the grid?

  16. The utilities now have competition from every homeowner who installs and produces their own power. They have never had that and have really never had to operate in a competitive market situation. They grow up and stop whining.

  17. I would do just the opposite I would have the power grid taken off of my property entirely.

  18. Trim the power completely be rid of the 85 dollar charge and buy a bank of battery’s and inverter…..and tap into the phone lines 50volt power for cloudy days.

  19. utilities need to read the story of Kodak. The company that developed the digital camera only to shelve it for fear it would put them out of business.

    Utility companies profit by providing energy. The source of that energy should not matter. Should they continue to shun, ignore or fight solar/wind/… as a source of energy generation, the sooner they will be past tense. Their “Kodak” moment awaits.

  20. I would separate my panel so that solar runs 100% electricity to part of my house so 1/2 of the house would be off the grid electricity. Feed none of it back into the grid.

  21. The grid needs maintenance in order for you to sell your renewable energy to anyone you must access the grid and therefore should be responsible for the costs of maintenance in your locale. To think otherwise is an irrational attempt to justify you freeloading of off regular rate paying customers.

  22. There is an easy solution. Pay the going rate for any excess they generate by solar or wind and put into the grid. Charge them a distribution charge based on what they would be charged if they purchased their electric from the company. This should end up being a win win for both parties. People selling power to the grid should pay their fair share of the cost of operating the grid but not more. Power companies shouldn’t have to pay a premium for this power.

  23. At the level of power being generated by small private arrays, the co-op shouldn’t be charging maintenance costs per KW generated, they should be a fixed monthly rate that all small customers pay evenly.

    The real problem is that solar is not economically viable no matter how proponents do the math. It requires state and federal subsidies to justify purchase & installation costs, utilities to pay higher supply rates through net metering and I’m not even going to go into the environmental impact of manufacturing the panels.

    That said, I love solar power. If everyone that could have a solar water installed one, the masses would probably be saving more power than the relatively few number of people with private solar arrays can generate.

  24. this is so wrong on many lvls , when we first looked at solar panels in the 70s we looked at the cost to buy them versus the cost from the electric company, nothing was ever mentioned that we would need to pay for someone else’s mantaecns cost. but back to our cost who’s going to buy our system and do replacements on our equipment. this is completely wrong. there also buying electricity from me so there making money. that saying i’m a producer you buy from me but I have to pay you to keep your lines up , sounds like your responsibility to me. solar is not cheep so you all should change the coop for your system’s mantaince cost when you have to change out your solar panels!

  25. What everyone always misses, and the power companies won’t mention… Every kWh used FROM the grid is charged a rate that covers the cost of the infrastructure. SO, if a solar system puts energy ON the grid, the infrastructure cost will be covered by the customer that pulls that energy OFF the grid. The solar system owner should be treated much like any power producing company and paid for all energy put ON the grid at a price comparable to that paid to coal/gas/nuclear/wind/etc. power companies. All infrastructure cost are passed on to those BUYING the product…not those that are SELLING the product.

  26. Commercial Power is attacking alternative energy, particularly solar power.
    Because they know that solar can put them out of business. The sooner, the better.

  27. Reading the comments here, there are some substantial misperceptions about both the effect of a residential-sized solar array on the power grid, and the cost recovery mechanisms used to compensate the utility for use of its system. There are detailed analyses on all these issues that have been completed by institutions and researchers that do not have an economic stake in either selling solar systems or protecting their state-granted monopoly powers. The unambiguous conclusions are that customers with net-metered sized solar systems are about as likely to be subsidizing other customers as being subsidized by other customers. The reliability of the grid is not affected at all by net metering customers until the penetration rate starts to get up towards 5% of load, and then the use of smart inverters and related existing technology can not only fix the problem, it makes the net metered system a distribution asset that can provide ancillary grid services to correct for all the imbalances created by power using customers. (Lawrence Berkeley National Lab, Sandia National Lab, NREL, Argonne National Lab,). All this is still being studied and new scenarios are being evaluated for that point in the future when we start putting 40 and 50% and 60% intermittent renewables on the grid. Iowa is currently at about 30% wind energy.
    When my neighbor’s solar system puts power back onto the grid at mid-day, because he is generating more than he is using, the power doesn’t travel back to the utility power plant or go to some storage system or even (in the overwhelming number of cases) flow back to the distribution transformer. The power goes to the nearest ground, which is my house, located 80 feet along the distribution line from my neighbor. The power company charges me the same retail rate for that power as for the rest of the power I consume. For the rest of the power, it came from the power plant 20 miles away, went across transmission, sub-transmission, primary and secondary distribution, and then to my service entrance. I have to pay for all that equipment. The power from my neighbor used 8o feet of distribution line to get to my service entrance. Why is the power company charging me full retail rate? I say, go ahead and pay my neighbor full retail rate for net metered power, and I will happily pay retail rate for it. And there is less congestion on the rest of the system, and the utility will be able to defer replacement of those components by a little bit, and we all will see downward pressure on rates. And the environment thanks us all.

    • Well, Brian, I certainly agree with you on most accounts of your statement. But, I recently have been in discussions with my local electric co-op and here are the simple numbers provided to me, based on a net-metered system. I currently pay approx. 8.4 cents per kwh metered usage. If, and this is the deal breaker for me, I incur the cost of putting in place a grid-tied net-metered system, that is large enough(and efficient enough) to allow me to supply an overage back to the grid, the co-op will “reimburse” me for any overage I supply back to the grid at a rate of 2.1 cents per kwh.
      After many, many, many hours of communications and computations with solar system marketers and engineers, it came down to me having to install a battery backed up, grid-tied system to support an avg 3k kwh (3000 kilowatt hours) monthly usage. After many different people, including myself, running the numbers for total investment costs, it very rapidly became evident that this was not going to be a viable, cost efficient investment. The total system costs (without installation) ran the gammet from $65,000 to $105,000, varying based on the quality of the different system components choices. That computes out to 22.5 to 40 years to recoupe my initial investment, assuming there were no maintenance cost to roll back into the initial investment costs. Bottom line……..NOT a viable option if I will most likely die before I ever actually see any financial balance or benefit from said investment.

  28. One should argue that why should rate payers have to subsidize heat discounted rates?

  29. Tesla Power Wall will be available this summer. I recommend buying enough battery to store as much energy as you need and then call your utility and tell them to remove their meter and stick it where the sun doesn’t shine!

  30. If PELLA is going to charge that fee for the up keep of equipment of the GRID, then the people paying that fee should get retail price on the electricity they create not a wholesale price the PELLA now pays…

  31. Hey Folks: Powerless Balc here. I have been a Powerless Man since 9/24/2015, Since Alliant Energy told me I had to replace the meter pole their meter was on to the tune of $747.00 dollars or they would disconnect me. I now read this story and another persons hard work on becoming more efficient becomes “Worthless” or in other words “Powerless to the power company too.” We need choices in rather then the monopoly system of only one provider for an area. If I had choices I would have switched to another provider that provides meter poles for their meters free of charge. (Most) Thanks for bringing your story forward and hopefully power companies realize they need the sustomer worse then the customer needs them. Take Care and God Bless, Sincerely, Powerless Balc

    • Oops I meant 9/24/2013 for my Alliant Energy disconnection date

  32. In conversation with one who has worked on cost of service studies for an REC, he explained the total costs of running an electric company are totaled and divided among all the users. Then each member will share in the costs of service. This seemed unfair for larger users to pay the same as smaller users. Think of retired on fixed incomes. So they come up with a stepped system of rates for electrical use. The first 100 or so kilowatts are charged at a higher rate and by varying size steps the cost is lowered to actual cost of power. In doing so, the cost of service is better shared without undoly charging the retired or anyone a a fixed income. Once the rate structure has been used in a monthly consumption the charge remains consistant. If the new base fee brings the consumer right to the lowest fee in the rate structure, it is actually more fair than the rate structure. If you as a consumer with your own generation still require power from your power provider, you will have paid the fees by time your usage reached the rate structure max. You would be hurt if the power company kept your consumption on the same rate structure and if you had no usage. Get info from the power company. Is the rate structure set up to go directly to the lowest cost per KWH? If it does you will be saving the rate structure costs you have already been paying. If you have the ability to disconnect and prosper, good for you. If you can not disconnect and prosper, understand the costs to remain connected to a reliable source.

  33. A better understanding needs to be made for cost of service charges. In a utopian world, an electric company would take the cost of service fees, that would be all budgeted costs, divide this by its customer base and calculate an annual fee and apply this to the monthly bill. In this utopian world the retired and fixed income consumer would pay the same fee as the largest user. To be sensitive to the smaller user the electric company created a step system called a rate structure to treat the lower user from a proportional imbalance of cost of service fees. In this rate structure, the first group of KWH purchases are at the highest rate, each step in the rate decreases to the point the consumer is paying the base rate for each KHW purchased. Depending on the goals of the designer of the rate structure different levels of user pay their share of the total cost of service. In these structures, all users using the energy to the set points in the rate structure pay the maximum cost of service. In recent times, the cost of serVice fee has been added to bills and are acceptable at the levels we are accostumed to. Had these cost of service not been added, the rate structure would have been adjusted to collect the cost of service required. In the rate structure system you eventually come to the lowest cost of power level. To that point you are paying the cost of service fees. The question the farmers with energy generation capacity need to ask is, in this rate structure at what point do I pay the lowest cost per KWH? If at night and cloudy days they still consume energy and through the course of the month still have usage that runs through the rate structure, they will have paid the same money as the cost of service fee if the rate structure is designed properly. Look past the monthly fee to the rate structure and you may find it may be fairer than you think. If you are set up to disconnect from the system good for you. If you require power from the power company to back up and handle demand beyond the capacity of your generation capabilities, understand completely what is being set up for you. I believe if you are using the energy now, you are already paying these fees, just in the rate structure you are now paying under.

  34. The rural electric co-ops seem to have forgotten that they got their start through federal subsidies for rural electrification. Now they want to use their monopoly power to stifle the next generation of innovation.

  35. Where I live, the city owns the utility. I had 10 panels installed last year, which will provide all my electrical needs. I am still on the grid. I draw from it on cloudy days, and pump energy back into it on sunny days. When the year is up, the city will cut me a check for my overage at the going kilowatt-hour rate. As of my last bill, I was 364 kilowatt hours ahead, with the fall-winter portion of the year already under my belt. Keeping the tally causes me to be even more conservation-minded in my daily life. The less energy I use, the more money I make. Do you see what happens with intelligent policy?

  36. Are solar owners subsidized by non-solar rate-payers (as utilities would say)? Or is solar contributing more value to the grid than the avoided cost rate of 4 cents that utilties want to pay, or even beyond the 12-14 cent retail rate of electricity (as solar advocates would say)? Some have gone beyond rhetoric and conjecture to answer that question. Minnesota spent years researching and calculating a fair market value of solar to the grid. Through their calculations, they determined that not only is solar worth at least the retail rate, but the true value of solar should demand a few cents of premium above retail rate. See the report here: They are not the only state to attempt to make a thorough accounting. For those of you who think solar is being subsidized by other rate-payers due to the cost of distribution infrastructure, keep in mind that solar is contributing value to all rate-payers, and in reality, is probably subsidizing other rate payers. Here are a few of the goods it provides, some of which have been discussed in earlier comments: 1) Energy generation during peak loads- peak times of energy demand coincide with solar production- and purchasing peak power on the wholesale market at those times is ridiculously expensive. 2)Reduced line loss/improved efficiency as the generation facilities are distributed among energy-users 3) Avoided infrastructure build-out (utilities normally build big plants and then socialize the costs to all users- but allowing more people to invest their own money and put up solar means fewer costs will need to be incurred for generation/socialized to ratepayers) 4)Once installed, cost is locked in for duration of the installation’s lifespan, in comparison to cost of coal, gas, etc increasing and causing ratepayers to incur more costs. Those are just a few….