TOU with Net Metering?

I did some research, and learned that my utility, Pacific Gas & Electric, was obligated to offer net metering (E-NET, the PG&E tariff schedule that deals with net metering). Now, that was interesting. As the owner of an electric car, I'm on the E-9 tariff schedule. This is a three-tier time-of-use (TOU) rate. The two lower priced tiers are offered in the winter, and the third, highest priced tier is for the summer months during the afternoon.

The rate schedule is set up to discourage use during peak load time, and to encourage you to charge your EV between midnight and 7 AM. The peak cost coincides with a PV system's peak production. I concluded that a PV system could pay for itself just by saving me from buying that expensive summer peak power.

I read the tariffs on PG&E's Web site. It wasn't clear to me how net metering worked for TOU customers. Would surplus generation be credited to me in kilowatt-hours spread out over my bill? Or would it be in dollars applied to my purchase of power at a lower rate later?

Bureaucratic Goose Chase
In getting the special rate for my truck charging, I learned that most of the people who answer the phones at the utility don't have the training to be of help with unusual questions. You have to work to find the person who can really answer the more complicated questions. For instance, within an hour of getting in touch with Efrain Ornelas, alternative vehicle program manager for PG&E, my EV account was set up. Prior to that, I'd had at least half a dozen conversations in a three week period.

Figuring that the alternative vehicle program manager would know who I should talk to about E-NET, I called and asked him for help. He put me in touch with Harold Hirsh in the renewables department. According to him, the answer was that I'd be credited in neither power nor money. He said that PG&E did not offer net metering with TOU rates. I would have to switch to a non-TOU rate if I wanted net metering. Funny, I never saw anything that said I'd have to be on a particular tariff to get E-NET.

So I made a few phone calls to the California Energy Commission (CEC) to try to clear things up. No one there had the definitive answer, but one name kept being mentioned as the person who would know-Vince Schwent (now with Sacramento Municipal Utility District). I called him and he said my take on it was correct. Every tariff was eligible for E-NET, and I should be credited in dollars, not power. This meant I could sell my summer afternoon excess at US$0.30 per KWH, and buy that power back at night to charge my truck at only US$0.04 per KWH!

I went back to PG&E, and they said that it was not technically feasible to do E-NET with TOU because the TOU meter was not capable of going backwards. The meter apparently treats all energy going into the grid as theft, and never allows the count to decrease.

Another conversation with the CEC pointed me to the Sacramento Municipal Utility District (SMUD). They have a comprehensive renewable energy program, and their meter shop had done a lot of meter testing. They found that General Electric makes a TOU meter that can accurately register backwards. This is their model KV.

During my next conversation with PG&E, I mentioned the GE model KV meter. Apparently there were lots of reasons why it wouldn't work for me. PG&E didn't use that meter and could not use it because of PUC regulations. They couldn't take SMUD's word that it accurately read in both directions. And the computer billing software wasn't set up for TOU and E-NET, so it wouldn't work anyway.

The tariff is pretty clear on one point; PG&E had three options:
1. Provide me with an appropriate meter.
2. Allow me to purchase such a meter.
3. Pay to have my house rewired to use dual meters.

Since they claimed that they couldn't do number 1, I was prepared to do number 2. In fact that was my preference, since I wouldn't have to make a lot of US$12 monthly meter rental payments to pay for a US$300 meter. The threat of option 3 seemed to be the way to get them to do one of the other two.

Further conversations with PG&E yielded more information. It turned out that they do use the KV meter, but only on some industrial accounts. So much for it not being in their inventory and unavailable to their meter shop.

Habib System Costs
Item Cost (US$)
24 Kyocera 120 watt panels $11,880
Trace ST-2500 inverter 1,725
Wiring and mounts 400
Service contract* 225
Total $14,230 * To bring the warranty to five years, as required for the buydown program.
Net Metering Solution
Eventually, I got connected with Phil Quadrini from PG&E's headquarters in San Francisco. He is the guy who knows the arcana of tariffs inside and out. He agreed that TOU and E-NET did not need to be mutually exclusive, and he figured out a way to make it all work.

I would get a GE model KV meter, which the meter shop would pre-load with 50,000 KWH as the starting point reading. Since the meter can't show negative numbers, this was necessary so that the meter will not stop at zero if my surplus ever exceeds my use. At the end of the one year averaging period, PG&E would read the meter and I'd pay for any net use during the year.

Once that was settled, Phil put me in touch with Jerry Hutchinson, who sent me the application package to get me legally connected to the grid. I sent in my application to connect my PV equipment to the grid and waited. Six weeks later, I still hadn't received anything back. I called to check the status of my paperwork.

 

The person who processes the applications told me I'd have to switch to a non-TOU rate to do E-NET. Apparently, the word had not filtered down. A few more phone calls referring back to my earlier conversations with Phil straightened that out. I now had a commitment from PG&E to combine TOU with E-NET.

It took a lot of perseverance to get the utility to go along, but everyone wins with this arrangement. This makes a PV system more affordable and therefore more feasible for homeowners. And for the utility, buying my surplus, even at about US$0.30 per kilowatt-hour, is cheaper than the high peak prices (which recently went above US$1.40 per KWH) when demand gets high. And the overloaded transmission network does not have the additional burden of bringing me energy from far away.

Since getting this arrangement, I've learned that I'm not the only one who sees the benefit of it. California State Assembly member Fred Keeley authored AB-918 to clarify the issue of E-NET and TOU. This legislation (now California law) requires the utilities to offer them together, and to buy back power at the retail cost of that power at the time it is generated. So there is now a very clear mandate that it must be done this way.

Not Just for Tree Huggers
A system like mine shows that PV power is no longer just for tree huggers and those who live far from the grid. If this system did not promise to be reliable and cost effective, I would not have installed it. Getting the E-NET and TOU helps to make the payoff even more attractive, but the economics are there even without it. If you don't have an electric vehicle to qualify you for the E-9 rate, you can get E-7. Right now, the cheapest E-7 rate is US$0.085.

The E-7 TOU rate still allows you to sell your summer afternoon surplus at high rates and apply that money to your off-peak usage. You just don't get the ultra-low rate from midnight to 7 AM. Of course, this assumes that you have a summer afternoon surplus, and that you're not dipping into the grid to run an air conditioner.

Now that the system is installed and has been working for a few weeks, I can say that I'm very pleased with it. On a nice day in February, I can get about 10.5 KWH of energy from the PV array, and on a partially overcast day, I might get 6 to 8 KWH. A couple of weeks ago, I got a bit more than 15 KWH. Once summer starts, I would not be surprised to see more. The best part is knowing that no matter what happens, my cost for electricity is frozen. Not contributing to pollution is nice, but it was not my overriding reason.

RE Goes Mainstream
I'm reasonably handy, but had no prior knowledge about anything solar. And I put together a working and cost-effective PV system. This shows that the products have matured to the point where PV is not just for the isolated or the ideological anymore. Homeowners who live in suburbia can decide to install a PV system purely for financial reasons, and still make it work out.