Industry News

  • Utilities Are Trying to Block Your Right to Choose

    22 March 2017

    Electric utilities have operated for a century without any competition. It was a bargain made long ago on behalf of the American people: Utilities can operate as monopolies as long as their prices are fair and they provide electric service to anyone that wants it. To make this construct work, utilities are overseen by regulators and guaranteed a profit.

    As a society, we’ve been largely ok with that bargain. It was just a fact of life that if we wanted lights, refrigerators and air conditioners, we had to pay whatever the utility asked. In fact, about the only times we think about the utility is when the lights don’t turn on or when our bill is higher than usual.

    You have a choice

    Well, now it’s 2017 and people are starting to realize they have options. In many places across the country, solar is more affordable, more reliable and cleaner than utility power. Solar adoption is growing and not just where you’d expect it to. Yes, California is a popular solar state, but even in Texas, where utility prices are some of the lowest in the country, solar is gaining ground.

    And the utilities are fighting this shift to energy choice because they’re scared.

    First, they fought net metering, a paradigm that credits solar homeowners for solar power they send to the grid. Then, utilities started building giant solar farms themselves. Why? Because they know it’s a good way for them to save money (but don’t expect to see your utility rates fall any time soon). Now, they’re proposing exorbitant fees and charges to penalize solar customers and to make sure that they are the only ones that can produce and sell electricity. Their goal is to stop people from having a choice in how, where and at what cost their energy is generated.

    If electricity were an open market like most other markets, utilities would simply lower their prices to compete with solar. But it’s not an open market. It’s a monopoly and so you have to pay whatever they ask. Instead of lowering their energy prices to compete, rent-seeking utilities are trying to make solar more expensive for people who just want to save some money. You should be angry because these anti-competitive practices affect your bottom line.

    Paying for something you don’t use

    Last Friday (March 17), Oncor, a utility based in Dallas, filed their rate case with the Public Utilities Commission of Texas (PUCT). The PUCT oversees regulated utilities in the state and part of that oversight is deciding on rate increases as part of rate cases.

    Here’s a transcript of Oncor’s full testimony (.pdf).

    Basically, Oncor is proposing to charge solar customers for electricity they are not consuming. Think about that and imagine being charged for gas you didn’t pump into your car or a meal you didn’t order or eat at a restaurant. Oncor wants to charge solar customers an exorbitant minimum bill to make sure that they continue to make a profit. However, they don’t care about your bottom line.

    Now consider that in states that embrace rooftop solar, the utilities are actually saved money by not having to undertake expensive upgrades or building power plants. Ultimately, that saves consumers money.

    If you live in a state where the utilities are using their monopoly status to block your right to choose how you power your home, contact your public utility commission and let them know how you feel. You may not be ready to have solar panels on your home, and that’s ok. You still have a vested interest in a competitive and fair market, because competition drives prices down and innovation up, and everyone wins.