Schools Right to Self-Consume
This should be a no-brainer to everybody; except for the IOUs
TL;DR
Call your California representative and tell them to support SB-1374 so multi-meter properties can self-consume the electricity produced by their solar panels. Schools should enjoy the same treatment as our houses.
The bill will be voted in the Assembly Committee on Utilities and Energy on July 1st. Your voice has extra value if your representative is a member of the committee.
Self-Consumption is a Good
Many customers have photovoltaic (PV) panels that generate electricity in their properties; our household has them and so do many schools in your neighborhood. The generated electricity generated is first self-consumed, it is used locally by appliances and other devices that place a load inside the house, and any electricity left after that is then sent to the grid.
There are many benefits for generating electricity close to the load. The California Energy Code recognizes this and it has mandated photovoltaics in most classes of buildings for years.
Variability and the Grid
The amount of electricity generated by the solar panels varies through the day, week, month, year; and the amount of electricity used also varies. This means that pretty much everybody installing PV, even PV plus batteries, will plan to sometimes import from the grid, and sometimes export to the grid.
Since installing PV (and batteries) have a significant cost, customers have to balance all these variables to find a financially acceptable solution. This applies to our households, as well as to the school district, and this means we have to consider the value of exports.
The Value of Exports
California initially assessed the value of exported electricity using Net Metering, first with NEM 1.0 and then NEM 2.0. After that, the California Public Utilities Commission (CPUC) decided to switch and use ACC - Avoided Cost Calculator - to determine the export value. The new export machinery is called NBT, the Net Billing Tariff, though it is very often called NEM 3.0.
I should write a full post just on ACC (I write to a large degree to help me learn a topic). ACC can be described as “what would your solar panel’s energy be worth if you moved it from your roof to somewhere on the utility grid?”. This definition is ignoring the reality that the energy “somewhere on the utility grid”, has to get from somewhere to my local distribution grid, and that is expensive (only 40% of my utility bill is Generation; 60% is Delivery). Delivery includes the transmission grid, transmission substations, distribution substations, distribution wires (primary and secondary), step-down transformers, and more, including those utility poles.
We can argue whether ACC is a fair way to value solar, but let’s set that aside for now. The IOUs (Investor Owned Utilities) successfully advocated for ACC, and NBT is what new customers use to determine the value of any export from their PV systems.
Balancing Act
Conceptually, the process used by a customer planning to improve self-consumption involves looking at the Generation assets (PV/Batteries), and the Load assets (Heat Pumps, whatever), drawing a line over all of them, and balancing the resources: how many PVs and batteries should be installed where, and how are they connected.
A Typical Single-Meter Customer
Our house is a typical single-meter customer. We have a small ADU but we decided not to use that roof because it would have meant extra electrical cabling and the extra panels would not have good solar exposure. Once decided to only use our main roof, we planned a re-roof and we used that opportunity to move some pipes to maximize the layout of the solar panels. We made no changes to our house wiring as our electrical panel had space for the solar connection and we did not install batteries at that time.
We ended up installing QCell Solar Panels with Enphase iQ8 microinverters.
Multiple Meters
A customer like a school has to go through the same balancing effort as we did but the effort is more complex as there are more places where to add generation PV and because there are more loads that are distributed through the property. In many cases the school may have multiple buildings that are connected to each other with some utility-owned wires, poles, and meters.
Physics… and “the” Grid
The laws of physics say that electricity flows to the nearest load. This is equally true for our household and for the school.
In our household, the electricity generated by the PV is converted from DC to AC by our micro-inverters. The electricity is then consumed by any AC load inside our house, and, if there is anything left, it will go through the PG&E owned AMI (Advanced Meter Infrastructure) to the Distribution Grid.
A single-meter situation is “easy”. Anything behind the meter is on the customer’s side. Anything in front of the meter is PG&E.
PG&E’s AMI can track exports and import at a fairly granular level. Starting this month, my PG&E bill now shows separate import and export values for every 15 minute interval, which means PG&E can use NBT to charge (more) for exports and (less) for imports within each 15 minutes… because… that’s how NBT works.
Back to Multi-Meters in one Property
Now let’s look at the school setup. In many cases there will be multiple buildings all in one property connected between each other through a wire and meters owned by PG&E. The electricity from the schools’ carport or the stadium will flow to the cafeteria or to the classrooms through those wires.
Here is a nice diagram (borrowed from HERE):
A key observation is that all these wires and meters are inside the property owned by the school. The electricity cannot “jump” from the Solar carport to, say, an Amazon data center; it first tries to go to the cafeteria (or the classroom, or whatever).
The old VNEM/NEMA
VNEM is the term for Virtual Net Energy Metering. NEMA stands for Net Energy Metering Aggregation. These “old” programs, in the NEM class, dealt with multi-meter customers and acknowledged the physical reality: electricity travels to the closest load.
When NEM switched to NBT, VNEM and NEMA stayed behind, still to convert to the ACC-based export credits.
When the time was right, a large consortium proposed to replace VNEM/NEMA with a variation of NBT, still based on ACC but recognizing the physics of electricity transmission. The IOUs instead wanted to treat any electricity that goes through any of their meters, regardless of location or connectivity, as if it was exported to the whole grid; as if that electricity was available to the above-mentioned AWS Data Center. Since NBT, by design, pays very little for exports, this setup is very problematic for schools with multiple meters.
In a decision in November 2023, the CPUC mostly aligned with the IOUs except for a last minute change to partially benefit multi-family residential housings. This setup is problematic for schools.
Enter SB-1374
The Climate-Ready Schools Coalition have a nice graphic summarizing the goal of SB-1374
In a nutshell: SB-1374 draws a line around electrical assets inside the property and uses the ACC-based NBT when electricity crosses that line, but not when it stays inside the line. It seems common sense to me, and it will make a big difference to customers like schools.
What is the alternative?
If the CPUC decision from Nov 2023 is left to stand, the IOUs will reap big financial benefits and the losers are customers like the schools. What can they do? I am not an expert but here are some guesses:
Use less energy, for example, don’t run the A/Cs in the classrooms as often,
Cut something else in the school’s budget,
Look for a school bond to pay for the extra operational expense,
Replace the PG&E meters and lines with private lines (caveat: I’d bet this can get really messy really fast but, what do I know). And look for a school bond to pay for the extra capital expense.
Somehow “live with it”.
Or…
Call to Action
Here is my call to action: call your California representative and tell them to support SB-1374 so multi-meter properties can self-consume the electricity produce by their solar panels. Schools should enjoy the same treatment as our houses.
The bill will be voted in the Assembly Committee on Utilities and Energy on July 1st. Your voice is of exceptional value if your representative is a member of the committee.
Also Note
SB-1374 would also benefit other customers besides schools, including agriculture businesses. SB-1374 would also address some unaddressed problems in multi-family residential buildings. SB-1374 went through Senate, its fate is now in the hands of the Assembly.
CalMatters has a detailed overview of SB-1374 that includes a list of supporters and opponents.