As the country increasingly transitions to a renewable-energy future, many utilities are ferociously resisting solar energy, often claiming homeowners who have solar arrays are pushing the costs of maintaining the grid onto other customers. Some utilities have placed punitively high fixed charges on solar arrays to diminish their economic viability — including here in Minnesota.
The reason for the resistance is simple: The business models of the utilities are being increasingly threatened by solar.
Like many states, Minnesota has a “net metering” policy. This allows the owner of the solar panels to take electricity out of the grid when needed and put solar power back into the grid when it is produced. At the end of the year, accounts are settled, and the homeowner either pays a small bill or gets a small check from the utility. The problem is that the utility doesn’t get any money to cover the cost of maintaining and repairing the grid we find so useful. When solar was expensive and rarely deployed, net metered solar was such a small part of most utilities’ generation mix that any cross-subsidization of costs to other ratepayers was of little consequence.
However, solar prices have dropped 90 percent since the 1970s and are still dropping 1 percent to 2 percent a month. This has led to an explosion in the growth of solar and considerable conflict.
For those still clinging to fossil fuels, a clever way to attack the growth of solar energy is to suggest that the wealthy will buy solar but will push the costs of the grid onto the backs of the poor. While the policies that follow this line of argument thwart solar and preserve utility profits in the short term, solar and battery storage is getting downright cheap. Soon, many who are wealthy or even middle class will simply defect from the grid with their solar panels and batteries: still connected to the grid but pulling no power from it. Meanwhile, the utility grid will be starved for resources and will go into a death spiral as rate increases push more ratepayers to defect from the grid.