Solar energy comes up often on HN, but it is misleading to talk about solar without differentiating between utility grid solar and consumer rooftop solar. Simply put, utility grid solar provides low cost power and consumer rooftop solar does not and will not. The rooftop solar price is usually hidden because no power source has been as subsidized as rooftop solar. Besides direct subsidies, wealthier home owners have often been paid the retail rate for the electricity they sell to the grid which causes higher electricity bills for those who can't afford to put panels on their roof - sort of a reverse Robinhood scheme.
The thing with rooftop/local solar is that it doesn't need to compete with wholesale electricity prices, it only need to compete with retail prices. It's already competitive there, to the point that most places are removing subsidies and retargeting them at storage (batteries), transmission, or EV charging infrastructure.
It isn't very clear what you mean. If utilities are required to do net metering (i.e. buy all power whenever it is produced at the retail rate rather than buy what they need at the wholesale rate) it is a huge unsustainable subsidy to wealthier homeowners paid for by the less wealthy. It's free riding on the reliability provided by the grid, putting large costs on the less well off. As these costs grew, that also provided an incentive for consumer solar installations to increase. Eventually the issue was impossible to ignore and states are starting to remove the subsidies. It is strange that anyone thought net metering ever made any sense.
As the statista.com report says
>...Rooftop solar photovoltaic installations on residential buildings and nuclear power have the highest unsubsidized levelized costs of energy generation in the United States. If not for federal and state subsidies, rooftop solar PV would come with a price tag between 117 and 282 U.S. dollars per megawatt hour.
Looks like that report is a year old, but I doubt the installation costs have really gone down much since then. (Panel prices come down, but labor costs, etc don't.)
I don’t know where you live, but I can speak to how it works in Australia.
Your energy bill has a fixed daily rate to be connected to the grid. That pays for poles and wires, maintenance etc. To oversimplify a bit there’s also your cost per kWh to buy energy and to sell it. Someone using their own PV system during the day and buying from the grid at night isn’t “free riding” like you think. The connection is paid for by the fixed connection fee.
I guess it all depends on the prices the utilities have to pay to buy the power and whether they are forced to buy the power if they don't need it. If the price is higher than the rate the utility would pay for utility scale solar, than I think you have to admit the owner of the solar panels is getting at least a small subsidy - likely paid for by other rate payers who are unable to put up solar. If the price paid is basically the same, then there should be no complaints from the other rate payers.
Sure, but they are not in most places. IMO subsidies made sense to kickstart the industry given the external costs imposed by climate change, but I agree that they don't anymore.
> >...Rooftop solar photovoltaic installations on residential buildings and nuclear power have the highest unsubsidized levelized costs of energy generation in the United States.
I don't think levelized cost for generation is the correct metric here. That ignores the costs imposed by grid transmission (and utility profit margins). It's also worth noting that installation costs in the US can be much higher than those in other countries (even other wealthy countries).
>...IMO subsidies made sense to kickstart the industry given the external costs imposed by climate change, but I agree that they don't anymore.
In general, if a dollar of subsidy spent on utility based solar will go much further than a dollar of subsidy spent on consumer rooftop solar, then it makes sense to spend that dollar on where it will go the furthest. That is true now, and was true 10 years ago.
>...That ignores the costs imposed by grid transmission (and utility profit margins).
But aren't those installations also attached to the grid? If not, the costs go very very high if you have enough battery that you don't need to attach to the grid.
>...It's also worth noting that installation costs in the US can be much higher than those in other countries (even other wealthy countries).
I wouldn't be surprised if some or all the OECD countries also subsidize rooftop solar, so it might be hard to compare actual costs.
Providing the infrastructure and reliability of the grid is very expensive, so there is a huge difference between the wholesale costs and retail rates for delivered electricity. From the latest Lazard report on levelized costs, they estimate utility solar has a cost range of about $29 - $92 per megawatt. Rooftop residential has a cost estimate of about $122 to $284. Both are subsidized, but money is limited and is fungible - a dollar spent subsidizing utility solar will go much further than a dollar spent subsidizing rooftop residential solar.
An earlier comment said "The thing with rooftop/local solar is that it doesn't need to compete with wholesale electricity prices, it only need to compete with retail prices."
You seemed to disagree with that? I'm pointing out that, at least where I live, it appears this commenter was correct.
Generally people who install solar also want to have power at night and when it is cloudy or raining. I think the earlier comment was maybe implying that there would be no grid connection - but that only works if you have enough backup battery to cover all the times the sun isn't shining. Battery costs have not fallen like solar panels have fallen and buying power from the grid would be noticeably cheaper. Even with the subsidies, few people who install solar panels also install enough battery backup that they don't need to use the grid.
The price of batteries has been falling pretty quickly. They're not quite affordable yet, but I'll eat my hat if they home batteries don't hit affordability in the next 5-10 years.
If rooftop solar costs me $300/MWh, that's a third cheaper than the $450/MWh charged by my local utility provider. So, even without any subsidy or feed-in tariff, it would be rational for me to install solar, use it when available, and fall back to the grid when it's not.
Again, the only point I'm making is that this this statement appears to be true:
The thing with rooftop/local solar is that it doesn't need to compete with wholesale electricity prices, it only need to compete with retail prices. It's already competitive there [without any need for subsidies]
>If rooftop solar costs me $300/MWh, that's a third cheaper than the $450/MWh charged by my local utility provider. So, even without any subsidy or feed-in tariff, it would be rational for me to install solar, use it when available, and fall back to the grid when it's not.
If you want the capability of using your own rooftop solar, you need to install a much more costly battery backup system. With a typical solar system, the electrical output is sent to the grid. (So, if there is an outage on the grid, it will also shut down your panels since they don't want you to possibly electrocute the electrical workers.)
Yea, it is pretty hard to understand the point you are trying to make and simply repeating yourself doesn't actually help. But to go through in more detail:
>If rooftop solar costs me $300/MWh, that's a third cheaper than the $450/MWh charged by my local utility provider.
The $300 is an estimated LCOE for the intermittent power produce by rooftop solar, not some charge you get in the mail. Utilities can buy or produce that power for much less than that cost.
>So, even without any subsidy or feed-in tariff, it would be rational for me to install solar, use it when available, and fall back to the grid when it's not.
Except as I pointed out, you can't "use it when available" unless you have a battery backup system which the LCOE will be much higher than what you will pay your utility over the life of the system. That might change in the future, but that is the reality today.
>Again, the only point I'm making is that this this statement appears to be true:
>> The thing with rooftop/local solar is that it doesn't need to compete with wholesale electricity prices, it only need to compete with retail prices. It's already competitive there [without any need for subsidies]
I guess you should ask yourself why you think that statement was true? The person who made that comment adjusted their comment to add that actual battery systems weren't competitive at this point:
>>"They're not quite affordable yet, but I'll eat my hat if they home batteries don't hit affordability in the next 5-10 years."
- Retaining the existing grid connection but not connecting the solar to it (or not connecting it in such a way that power is sent back to the grid).
- Running household electrical loads off of the solar when available, falling back to the grid connection when it isn't.
You don't necessarily get full utilisation of the solar energy this way, but you can often still save a whole bunch of money compared to not having the solar. Especially if you are willing/able to load shift energy intensive things like washing/drying to times where the sun is shining.
You can also potentially gain additional savings by having a smallish battery that gains you some additional utilisation without it necessarily having to cover your entire daily usage.
Except as I pointed out, you can't "use it when available" unless you have a battery backup system
Maybe I've misunderstood, but aren't people already using these systems when available, without battery backups? And just reverting to paying PG&E when the sun isn't out?
ok, I think I misunderstood what you meant. Yes, when the sun is shining and the power grid is alive, you can use your power. People are usually shocked to find that when there is a power outage, they generally can't use their solar panels to have power (unless they have a battery backup system which can isolate them from the grid). But the costs for installing consumer solar are high enough that these systems only had a reasonable payback period when people could sell the power back to the utility at a very high rate. I see that in CA when they finally had to lower that subsidy, demand for consumer solar is estimated to have dropped by 80%:
While solar panel costs have dropped very low, the soft costs for installing rooftop solar (labor, permitting, etc.) have only gone up, so one off rooftop solar will always be more expensive than utility solar.
