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Time-of-Use Rates—Good for Some, Bad for Others

If you are interested in solar, now is the time to act. A mandatory time-of-use (TOU) rate law will take effect in 2009 which may be financially detrimental to anyone looking to purchase a partial solar system. Customers with systems installed now have the choice of an E6 time-of-use schedule or an E1 tiered rate schedule.

TOU Background
When the California Solar Initiative (CSI) started, Senate Bill 1 required all solar customers to switch to a time-of-use (TOU) rate schedule (rates based on when energy is used, with higher rates charged during high demand times). Initially, this appeared to be a good thing for solar customers, because solar systems capture the most energy during peak demand times and they would be credited at higher rates. For solar customers who are able to replace 100% of their energy needs with their solar systems, this plan could work favorably.

However, customers who have partial solar systems and still required some coverage from the utility companies were finding much higher bills. This was because the power they were buying was at peak demand rates—rates that were much higher than their old E1 rate (fixed tier rate PG&E residential schedule). For them, it defeated the whole purpose of purchasing a partial solar system to reduce electricity costs, and could happen again in the future.

The mandatory TOU rates were recently put on hold, but will be back in 2009. Act now to be grandfathered into the E1 rate!

Current TOU and E1 Residential Rates

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Story Directory

Time-of-Use Rates—Good for Some, Bad for Others

Coming Soon—Energy Efficiency Upgrades Required, Rebate Payments Decreasing

Real-time Pricing—Putting Customers on the “Spot”

SmartMeters—Gateway to Higher Rates

Demand Response—Cutting Power to Save Energy

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