[Ok-sus] New clean energy tariff

Joel Olson joel.olson at att.net
Thu May 1 06:15:27 UTC 2014

For those who may be a little fuzzy on net metering, here is
the way it works, afaik.

Net metering laws require the large utility companies to allow a
homeowner to connect to the grid, subject to some technical
standards, such as a cut-off switch and that clean 60 cycle AC
be generated. These are called grid-tie systems.

The connection to the grid is within the home wiring, "below"
the meter. When the solar array (or wind turbine) is generating
electricity, that power gets used instead of external power. So
the homeowner's 'payment' for that power will come in the form
of a lower utility bill. Lowered by the charge they would have
incurred had they needed that amount of electricity. Note that
there is no transmission or use of the utility lines here; the
utility thus avoids the transmission losses they'd have absorbed,
had that power been drawn by the homeowner.

The more real situation expands on this by considering the rate
at which the homeowner generates electricity - peaking in the
afternoon for solar, late at night for wind. That rate varies only
with the weather - wind speed, cloudiness change often - and
the homeowner has little control of it.

What the homeowner can control, however is their USE of power.
They can put off using the electric oven till late at night, and
manage their usage in other similar ways.

So now we need to compare these two rates. When the homeowner
is using less energy than they are generating, the "excess" goes
through the meter, turning the dials backward, and onto the grid.
When the home is using more current that it is generating, the
additional amount needed is drawn through the meter, into the
house wiring, and the dials record the amount for the next month's

Considering this now over a 24-hour period, if more was used by
the home than was generated, there will be a net addition to the
bill. If more was generated, i.e. if there was a "net excess" for that
day, there will be a reduction to the bill. Only when there is such a
net excess at the end of the monthly billing cycle, is there "excess
generation" to be resolved. (I.e. the utility company would owe the
homeowner money.) OG&E and PSO each handle this situation in
their own way. PSO simply absorbs the excess generation and does
not pay the homeowner; the bill starts again on the next month's
cycle. OG&E, however, carries these over to the next month, and
if there is still excess generation at the end of the year, they pay
the homeowner for it, at what they calculate to be their "cost avoided."

Yes, the potential is there for a homeowner to make a big investment
and get a check from the utility company every month. But this is
not really feasible, as the OCC rules on net metering place severe
limits on the size of an array that the homeowner can install and
still be able to tie into the grid.

The interested reader may want to cross-check this account with

----- Original Message ----- 
From: "Dalton, Deborah W." <dalton at ou.edu>
To: <ok-sus at lists.oksustainability.org>
Sent: Wednesday, April 30, 2014 7:28 PM
Subject: Re: [Ok-sus] New clean energy tariff

As I understand it the utilities are more than happy to receive/accept the 
excess power when your solar panels are working hard and your meter is running 
backward without compensating you for the power or for your own infrastructure 
costs. They just don't want to pay you for your generated power. Is this true? 
If so it seems hypocritical...

Sent via the Samsung Galaxy S™ III, an AT&T 4G LTE smartphone

-------- Original message --------
From: Kelley C Smith <smithkc at riskiii.com>
Date: 04/30/2014 6:49 PM (GMT-06:00)
To: ok-sus at lists.oksustainability.org
Subject: Re: [Ok-sus] New clean energy tariff

Hi Mike,

I know you, but you don't know me. I worked for OGE for 16 years, and have now 
been away a long time. My background is economics and statistics, so anything i 
"know" about engineering was something I was told, usually by an OG&E engineer. 
:-) I will grant that my information may be outdated, and perhaps a little 
biased. :-)

Hope everyone takes note of your explanation of devices that "ensure that a wind 
or solar system is disconnected from the power grid in less than one second in 
the event of a power outage and that they stay off-line until grid power is 
restored for at least 5 minutes." I'm glad to know this. Some engineers I 
remember thought this could be a problem; others dismissed it as a non-issue.

But, the generation planning problem is the much more expensive issue of the 

I'm a little perplexed as to how wind or solar could help much with 
peak-shaving. If a customer installs wind or solar, and doesn't need his/her own 
power during hot summer afternoons (allowing for occasional ups and downs) then 
the customer has installed extra capacity. This isn't a customer who has some 
occasional spare power; this is a mini-utility, a merchant generator.

I am inclined to think, that from society's point of view, mini-utilities --  
widespread distributed generation -- might be a really good thing. It seems to 
me it would cut down on line losses, and that alone might be reason enough to 
pursue it.

It's hard for me to think of back-up generating capacity costs as "theoretical." 
Either the generator is there when you need it, or it isn't. And it has to 
continue to exist and be ready to run all those hours, weeks, months you don't 
need it. The transmission system has to be there -- high lines, substations…. 
and has to be maintained. There could be distributed back-up on a smaller scale 
than an OG&E, PSO, PG&E, Conn Ed….. for sure. But if we want the convenience we 
now have, somebody has to lay out some dollars for generating equipment of some 
kind, and somebody has to maintain the transmission and distribution system. 
This could be publicly owned. It could be a coop…..

It just seems to me that there is an awkward gray area where we want our own 
generation (and the cleaner air that we desperately need), but also to be able 
to rely on a backup source -- an energy provider of last resort. It's not much 
of a problem for a few isolated customers here and there to install wind, solar, 
whatever and "drop in" occasionally for emergency backup. But, they can count on 
their neighbors continuing to patronize the franchised investor-owned utility 

I'm not saying this is a good bill, and I am still not sure I have the details. 
I would argue that to get to a point where carbon emissions are acceptable will 
bring up some difficult legal issues…..but I think this post is too long 

I'm really glad there has been this discussion.


On Apr 30, 2014, at 11:23 AM, "Mike Bergey" 
<mbergey at bergey.com<mailto:mbergey at bergey.com>> wrote:


Let me correct a few things you got wrong in your response to Vicki.  Also, I 
see a lot of confusion on listservs about net metering so allow me to clarify a 
few things.  I have 35 years’ experience in this arena and was directly involved 
with the establishment of net metering regulations at the Corporation Commission 
in 1986.

First, there are no added costs to a utility to enable net metering.  Your 
standard dynamometer type energy meter (the ones with the spinning disc) works 
perfectly well, unless it has an optional ratcheting mechanism, whether power is 
flowing into or out of the home.  The same is true for electronic and smart 
meters, though “ratcheting” (not registering reverse flow) can be implemented in 

Second, there are no “extra controls” that a utility has to install to provide 
protection for linemen responding to a power outage.  Doubly-redundant automatic 
safety disconnects required under IEEE standards for the interface electronics 
ensure that a wind or solar system is disconnected from the power grid in less 
than one second in the event of a power outage and that they stay off-line until 
grid power is restored for at least 5 minutes.  FYI, these safety standards 
exceed any requirements that utilities place on the use of back-up generators 
for homes.

Excess wind or solar production naturally flows into the utility power lines and 
is sold by the utility to a neighboring home at the retail rate.  Federal law 
requires all utilities to pay for excess generation at a rate at least 
reflecting their “avoided costs”.  Net metering (run the meter backwards) is a 
policy that gives the customer full retail value for excess production (as if 
they had consumed it in their home) and saves the utility the not-insignificant 
costs of administering different buying and selling rates.  Before Oklahoma’s 
net metering regulation was adopted in 1986 we had customers with 1 kW wind 
turbines that were receiving monthly checks from OG&E for as little as 6 cents. 
We estimated it cost OG&E ~$25 to read the second meter and process those manual 

Excess production typically ranges from 0 – 40% of annual wind or solar 
production, so net metering policies really only affect the valuation of a small 
percentage of the energy produced.

There are theoretical costs for utilities to provide back-up capacity and 
maintain the transmission and distribution infrastructure to deliver back-up 
energy.  There are also theoretical benefits to utilities for voltage support, 
VAR injection (power factor improvement), peak shaving (summer for solar and 
winter for wind), and environmental attributes from distributed renewable energy 
generation.  SB 1456 is a solution in search of a problem and one can only hope 
that the accounting to be done by the utilities will include both the costs and 
the benefits.  Done right we might the surcharge might turn out to be negative 
(i.e., a credit).

Mike Bergey
President & CEO
Bergey Windpower Co.

From: Ok-sus 
[mailto:ok-sus-bounces at lists.oksustainability.org<mailto:sus-bounces at lists.oksustainability.org>] 
On Behalf Of Kelley C Smith
Sent: Tuesday, April 29, 2014 9:32 PM
To: ok-sus at lists.oksustainability.org<mailto:ok-sus at lists.oksustainability.org>
Subject: Re: [Ok-sus] New clean energy tariff


Your coop is different from OG&E or PSO, yes. I am thinking Ozark is a 
distribution coop…. it does not own any generating units. It probably buys 
energy from a G&T coop, or somewhere. OG&E and PSO both own generation, 
transmission, and distribution facilities. Is that right? And, having to sell 
power on an unpredictable basis is different when there are  a small number of 
people "dropping in" for emergency power than when a significant portion of 
customers are doing that. THis is an issue that a distribution coop need not 
worry about. it's the generator's problem!

The type of generation unit built is determined by the "shape" of the load. That 
is, if all your customers are oil refineries which have a more or less constant 
power demand 24/7, you build a unit that can run flat out all year long…. well, 
no unit can do that, but you would build a "base load" generation station, high 
capital costs, low variable costs. If you need additional generation  for hot 
summer afternoons when people turn on air conditioning, then you build a 
"peaker" unit… usually something with a lower capital cost, and these invariably 
have higher variable (fuel) costs.  Base load stations simply cannot be run the 
way peaker units are. THe startup and shutdown is much more complex…..I could go 
on, but maybe an engineer will chime in here.

Also, on the distribution or power delivery side, there are costs associated 
with allowing people to sell power back to the utility. For example, say there 
is a bad storm that knocks some lines down. If the utility is the only party 
sending any power along the system, they know where to flip switches to make it 
safe for line crews to restore power. If various houses are selling power back, 
there are extra controls that have to be installed so that this power can be 
shut down in the case of repairs.

Yes, as you point out, there could be a flat rate for all customers to pay for 
any costs associated with net metering One could argue that everyone would 
benefit from cleaner air from wind or solar power, and thus all should pay for 
net metering equipment (net metering is the term for charging a customer for 
their energy net of what they "trade" back to the utility) as just another 
little chunk of the customer charge. That would be one way to go about it.

Perhaps I've said more than enough, as I am not sure I have the complete info on 
the bill anyway. I am not necessarily defending any particular viewpoint, but 
electricity is a very complicated thing to buy and sell. I think solar and wind 
power are very interesting, and a lot depends on energy storage technology. 
Perhaps some affordable type of battery will come along, and the need to 
maintain an expensive distribution system will not be such a big deal.

I am afraid any bill that was hurried through the legislature sounds suspicious.


On Apr 29, 2014, at 9:11 AM, "Vicke Adams" 
<vicke at vickeadams.com<mailto:vicke at vickeadams.com>> wrote:

I don't know how OG&E or PSO operate since I have Ozark Electric which is a 
cooperative. Ozark does not pay for electricity put back on the grid. They also 
charge a minimum monthly amount of $25 regardless of how much electricity that 
you use. That is how they pay for infrastructure for minimal users. There are 
many summer cabins out here where I'm at. Those people pay $25 per month, every 
month, even on months they don't come out to their cabin. So, utility companies 
have already figured out how to provide for their infrastructure.

But let's look at an analogy to your argument. Toll roads are built and 
maintained by the people that pay to use them. There aren't different charges 
based on how much you use the road. They don't charge me if I opt to use the 
alternate roads for a few months. Would you give the Turnpikes the right to 
charge those who don't use it since they have to build and maintain it on an 
unpredictable basis?

I read somewhere that Governor Fallin's executive order implementing this law 
basically guts it. I've read the executive order, twice, and I have to admit 
that I don't understand what it says. If it guts the law, I'm not sure how.

From: Ok-sus 
[mailto:ok-sus-bounces at lists.oksustainability.org<mailto:sus-bounces at lists.oksustainability.org>] 
On Behalf Of Kelley C Smith
Sent: Monday, April 28, 2014 4:27 PM
To: ok-sus at lists.oksustainability.org<mailto:ok-sus at lists.oksustainability.org>
Subject: Re: [Ok-sus] New clean energy tariff

I'm not sure I understand the bill, and I don't want to be an apologist for the 
fossil fuel industry… but, I think I should say something or at least ask a 

When I looked, I thought the bill was imposing a sort of tax on those who had 
solar panels, etc. and who wanted to connect to the grid to sell power and to, 
when necessary, buy power. That is, if there is cloud cover for a few days, and 
a family's battery back-up is running low, they would want OG&E or PSO or 
someone to supply them some power for a while. Also, some people want to sell 
surplus power.

Asking a utility to be your back-up of last resort is asking quite a lot. How do 
they plan for this? Why should they build, and maintain generation, 
transmission, and distribution facilities to sell power on such an unpredictable 
basis? That's the question society must answer.

Maybe I misunderstood, and I am not saying that OGE or PSO should get whatever 
they want (if indeed that's what this bill does), but we have to think about 
what it means to change from fossil fuel generation and how we deal with days 
when the wind doesn't blow or the sun doesn't shine.

Perhaps a more equitable, and maybe more economical solution would be very 
small-scale portable gasoline or diesel generators. Or, perhaps we should look 
into every possible milliwatt of energy we can save and just not ask for back-up 
from the grid. It is a difficult question.


On Apr 27, 2014, at 5:52 PM, Stephanie Jeffords 
<buzzardroostranch at gmail.com<mailto:buzzardroostranch at gmail.com>> wrote:

This bill is a horrible infringement on our freedom and inalienable rights.

It might be advantageous to create a petition through 
change.org<http://change.org/> to have this bill repealed.

The bill obviously creates a double standard and feeds the oil and gas monopoly. 
If our legislators can pass this bill to assess fees on our own
solar and wind power, what else will they try to tax or make a law against, my 
garden vegetables so that Monsanto can have complete control of all crops?
Through despot bills and over taxation our legislators are destroying our small 
farms and ranches, the backbone of this country.

We have legislators that are allowing the oil and gas industry to have absolute 
power or control of our state government. This is despotism and is addressed in 
the preamble to our
Declaration of Independence, which also states that:
"We hold these truths to be self-evident, that all men are created equal, that 
they are endowed by their Creator with certain inalienable rights, that among 
these are life, liberty and the pursuit of happiness."
No where does it say that all corporations are created equal with inalienable 
We can not have life, liberty and the pursuit of happiness, when our legislators 
engage in discriminatory, self-serving and over taxation to suppress new 
technology and innovations that would take us off our forced dependency on oil 
and gas.
I will sign your petition!!

On Thu, Apr 24, 2014 at 8:15 PM, Vicke Adams 
<vicke at vickeadams.com<mailto:vicke at vickeadams.com>> wrote:

Is anyone else upset about the new fees that are now going to be assessed 
onOklahomans that have solar or wind energy? This legislature is not in touch 
with reality. How and why are they penalizing me for trying to be more 
sustainable, not to mention to have a source of energy when the grid is down? I 
am located in a very rural area. I spent over $6000 to have a small solar power 
system that provides electricity to a portion of my cabin, It allows me to keep 
functioning when the grid is down. Just this week the grid was down in my area 
for almost four hours. No storms, no explanations.But, now that same utility 
company will have the right to charge me a monthly fee because I have solar 
panels on my roof!

I called my state representative and senator as well as others to ask them not 
to vote for this bill. I hope others were doing the same. What I fear is that 
this terrible bill was passed through both houses and signed by the governor 
today in such a slick, quiet way that most people probably don't even know it 
has happened. I keep waiting for the outrage but so far, I'm not seeing or 
hearing any coverage.

What's up with this? I'm about ready to drive to the capitol and go office to 
office registering my displeasure with the entire place. Although, I fear that I 
would end up in jail and then who would be here to milk the goats that night?

Vicke - One really unhappy Oklahoman

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