Solar Power And The Continuing Fight Against Monopolies

The solar power industry is in a continual battle with electric utilities.

Utility corporations all across America are currently waging a war against the rising threat of commercial and residential solar power. It’s no surprise, really, as the rate of solar adoption has caught many conventional power utilities off guard and is eating into their profit margins. The monopoly that these corporations have enjoyed for many decades is finally being threatened.

This article will consider two specific situations in Nevada and California, which are easily representative of struggles across the nation.

The first case we will consider is concerning a ballot measure in the state of Nevada. Question 3 is named “Changes In Energy Market and Prohibit-State Sanctioned Electric-Generation Monopolies Ammendment.” A yes vote would…
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“require the state legislature to pass laws to establish “an open, competitive retail electric energy market,” prohibit the state from granting electrical-generation monopolies, and protect “against service disconnections and unfair practices” and declare that persons, businesses, and political subdivisions have a “right to choose the provider of its electric utility service” and cannot be forced to purchase electricity from one provider.”

Large amount of advertising money has been spent, mainly by Nevada’s utility, NV Energy, to protect its mononoply. Apparently this has been quite effective as recent polls show that this measure may be a close call. This was not the case 2 years ago, which showed approximately 70 percent of voters approving the decision.

Ultimately this comes down to consumer choice and an open and free marketplace. This is one of the defining characteristics of America. It’s an important cornerstone of our country. Therefore any argument that intends to defend or preserve a monopoly is highly suspect at best and does not reflect our values as Americans. Solar companies and individual homeowners should have the right to produce their own energy and be allowed to compete in the marketplace.

In California, as in many other states, net metering policies are under attack from utitilies. California currently has a fair net metering policy which states that homeowners get the full retail rate for their excess solar generation.

However, there has been ongoing discussions about policies meant to replace net metering. The rationale, from the power companies perspective, is that those with solar have not been paying their fair share for “grid maintenance.” It can just as easily be argued that these power companies are not too happy about sudden loss of revenue streams from those customers who now have solar. The proposed replacement for net metering would be a tariff that would ultimately fall somewhere in between customers being compensated at the “avoided cost rate” and the full retail rate for electricity.

Again, what we have here is another example of incumbent energy companies throwing around their considerable weight to help preserve their choke-hold on the industry.

Another important part of this particular story is the role that energy storage will play. California utilities are also aware that if customers are not adequately compensated for their excess solar energy, whether being provided at the time of production or from a source of storage like a lithium battery pack, then they may potentially defect from the grid altogether.

The bottom line here is that, ultimately, freedom of choice must be offered in this changing energy industry, like any other.

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