When it comes to the U.S. economy, the “con” part offers the best description of the current relationship between business, government and the preyed upon consumer. The way things work in early 21st century America is large businesses bribe politicians in a variety of ways at both the local and federal level, and the end result is laws that are designed to increase corporate profits at the expense of the wellbeing and freedom of the American public. Politicians end up with financial war chests to run their next campaign, while bureaucrats see a lucrative opportunity to swing through the ever spinning revolving door should they play ball with lobbyists and their patrons. Yes, there’s always some degree of corruption within any society of humans, but there are peaks and valleys in such cycles. I’d argue we are somewhere in the peak corruption phase.
Today’s article focuses on one of the most highly regulated industries in the country, electric utilities. It’s one of the most boring businesses in America. I know this because it fell under the umbrella of my responsibilities during my last Wall Street job, and I could barely read a utilities research report without immediately falling asleep. Nevertheless, as you’ll see in today’s piece, the industry still finds a way to generate large profits while simultaneously harming the people it’s supposed to service.
When I think about solar panels, it’s not just the use of a renewable resource I find appealing, but also the potential to take energy generation into your own hands; something that can prove quite useful in a major global crisis, or even something more minor like Hurricane Irma’s impact on Florida. The latter could’ve been a lifesaver for some Florida residents recently, but a local electric utility has done everything in its power to deny its customers such freedom.
Here’s some of what we learned about this situation from a fascinating article published by the Miami New Times, Why Didn’t FPL Do More to Prepare for Irma?
Hurricane Wilma, the last ‘cane to hit South Florida, tore through the area in 2005 and killed power to 3.24 million of FPL’s then-4.3 million customers (75 percent of the grid). Many of those customers had to wait up to two weeks for power to return. Since then, the company has spent more than $2 billion supposedly girding itself against the next storm, according to a Sun Sentinel piece published before Irma hit.
But after Irma, which by most reports brought only Category 1-strength winds to South Florida, by some measures the company did even worse. Despite all of those upgrades, an even larger percentage of FPL’s customer base — 4.4 of 4.9 million customers, almost 90 percent — lost electricity this past weekend.
FPL and its parent company, NextEra Energy, have for years heavily influenced state and local politics through donations, making billions in profits each year ($1.7 billion alone in 2016) thanks to favorable state laws that are sometimes literally written by the power company’s own lobbyists.
FPL’s lobbying wing has fought hard against letting Floridians power their own homes with solar panels. Thanks to power-company rules, it’s impossible across Florida to simply buy a solar panel and power your individual home with it. You are instead legally mandated to connect your panels to your local electric grid.
More egregious, FPL mandates that if the power goes out, your solar-power system must power down along with the rest of the grid, robbing potentially needy people of power during major outages.
“Renewable generator systems connected to the grid without batteries are not a standby power source during an FPL outage,” the company’s solar-connection rules state. “The system must shut down when FPL’s grid shuts down in order to prevent dangerous back feed on FPL’s grid. This is required to protect FPL employees who may be working on the grid.”
Astoundingly, state rules also mandate that solar customers include a switch that cleanly disconnects their panels from FPL’s system while keeping the rest of a home’s power lines connected. But during a disaster like the aftermath of Hurricane Irma, FPL customers aren’t allowed to simply flip that switch and keep their panels going. (But FPL is, however, allowed to disconnect your panels from the grid without warning you. The company can even put a padlock on it.)
The law winds up forcing residents to remain reliant on the state’s private power companies. For now, solar-panel owners can still get something out of the law, in that the “net-metering” provision lets you sell excess power back to the company. The provision also lets power companies charge a $400 or $1,000 application fee for consumers who want to install systems more powerful than 10 kilowatts.
But if power companies had their way, the net-metering law would vanish tomorrow. Both FPL and its trade association, the Edison Electric Institute, have spent millions trying to kill that net-metering law and instead win the right to charge you for installing your own solar-panel system. In 2016, FPL spent more than $8 million on Amendment 1, a ballot initiative that industry insiders admitted was written to trick customers into giving up their rights to solar power. The law’s language would have paved the way for Florida to kill net-metering rules.
This past April, the Energy and Policy Institute caught an FPL lobbyist straight-up drafting anti-solar laws for Fort Myers state Rep. Ray Rodrigues, who also took a $15,000 campaign contribution from FPL this year.
Thanks to power-company influence, one of America’s sunniest states lags far behind the rest of the nation when it comes to solar adoption.
Does this sound like an industry looking out for the best interests of its customers? Does it sound like the behavior of an industry where heavy regulation has successfully ensured that corporate interests are aligned with the general public?
No it doesn’t, and it makes me wonder how common this sort of behavior is across the country. I encourage readers to share knowledge of their own local utilities in the comment section.
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Michael Krieger
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The requirement to shut down when the grid goes out is indeed a safety issue as they say, and it’s a requirement around the world. It’s built into the inverters.
With batteries, a contactor, and a more complicated inverter, a house can be a stand-alone “island”, subject to the local laws allowing this, but the additional expense is not something 99% of consumers are interested in.
Irrespective of whether people are interested in the additional expense, why is there a law making it illegal?
i followed the link above “You are instead legally mandated to connect your panels to your local electric grid” but that’s not exactly what the linked article claims. it appears tat you are allowed to have solar panels that are not connected to the grid as long as the house is connected to the grid. if that’s true, you could run a separate system for solar and have alternate outlets that run from that system. complicated and expensive but still doable.
Sure, “is indeed a safety issue”
First we demand you to only get your goal by non-safe ways, then we demand you cease using non-safe ways. Catch 22
I have 6750 watts, grid tied, with battery back up. The City of Ocala tried the same thing with the net metering. Initially, we had a meter that actually ran backwards when we were producing more than we were using from the grid. That is what is called 1 to 1 net metering, and we loved it. Then they came up with a new deal, installed a different meter and we were only compensated for only 25% of the extra power we produced, then sold it to our nearest neighbor for 100%, which is total BS. Anyhow, since the November vote, which we voted NO, they had to change that back to where we get reimbursed as we should. Here in Ocala, there is no “rule” to where when the grid goes down, we have to disconnect. If there was, I would shoot the first utility worker that tried to disconnect my $40K system from my house. During hurricane Irma, while we lost the grid power at 10 PM Sunday, I still had my battery bank powering the house and did so until the power came back on Tuesday at noon. All the utility companies that do business in FL are doing their best to screw the customers. FP&Ls claim that it would back feed their lines is BS and can be avoided by shutting off the “Main Disconnect” which separates the house from the grid. Plain and simple. The same procedure when you hook up a portable generator. Shut off the main disconnect.
Curious as to whether the local EMC’s have the same rules and regs as FPL regarding solar?
My experience has always been that the EMC’s are much easier to deal with than the big boys.
‘Here in Ocala, there is no “rule” to where when the grid goes down, we have to disconnect.’
Really? So when the grid goes down, your system attempts to provide power to your neighbors’ houses, possibly electrocuting line workers attempting to fix the problem?
Greg, no, no, no. That is only when the grid is up and running. As with any grid tied system, what ever excess power my system produces, is sold to my nearest neighbor. But NOT in a grid down situation. Maybe I should have separated it between grid tied only, and grid tied with battery back up. The article mentions that FP&L does not require the “lock out” in the event of a grid down situation when a battery back up system is used because, the inverters separate themselves from the grid automatically and go to battery back up. I have battery back up. You are correct stating that most grid tied inverters shut down the system automatically when the grid goes down for the safety reasons you mentioned. With the more expensive systems (Outback, Schneider), “as far as I know”, the automatic shut down can be bypassed and as long as you shut down the main disconnect, the panels can still be used. Basically turning it into a stand alone system. Although, you would not derive much benefit from them. The battery back up is the way to go. But, they are double the cost mostly due to the batteries, cabling, extra back up panel and wiring.
Michael is also speaking about the “Law or Rule” that makes them put a system “lock out” on the panels, negating any benefit from the panels. All the power companies in FL are really sneaky and greedy.
What really stinks about most counties in FL, they state that if there is grid power available, and you want solar, you MUST hook up to the grid. You can not have a stand alone “island” home when grid is available. They want that “control”.
Please stop with the drama, Greg. These professionals take the same precautions as when there are working with live 220. And we’re supposed to believe that generators would not present the same challenge as solar?
This is a safety issue to protect the Power Line workers from electrocution. You see if they disconnect the power and start to work on fixing the lines and at the same time someone turns on a solar system that backfeeds into the lines that can and has killed workers. So to protect them they made it illegal to run a solar system when the grid goes down.
They now have special safety disconect switches to prevent this but the old rules remain in place and nobody wants to risk the lives of a worker if the switch isn’t connected right or malfunctions.
I used to install solar systems for a living and have a 10k electric solar system on my roof.
Mike, please stop. The Florida law doesn’t stop you from installing a solar PV system that is both grid interconnected and uses batteries to power backed up circuits in the home or business, switching loads to battery and inverter power and – in compliance with national and international standards and the NEC electric code, disconnecting the grid when it fails so that linemen don’t get electrocuted. ALL intertwined generation had to disconnect when the grid it is tied to fails. Nikes. Coal. Gas. Hydro. It’s a safety issue. To prevent “power islanding”.
People generally don’t want to spend the extra $15000 for this capability. It’s over the counter tech. I’ve been using it for 15 years and am, right now. If there is grid power to your site, you’re unwise not to take advantage of it. Net metering. The grid is a huge nearly free battery. Store power and get it back for free, or a minimal monthly fee. I bank energy 9 months a year and heat for free in the winter. Can’t do that with batteries.
Thanks for your insight. If you are saying that in Florida you can legally also run your own independent power using solar at times of grid outage via the extra cost of using your own batteries, then I interpreted the article wrong or it was intentionally misleading. This is totally possible, which is why I value reader feedback.
Are you certain this is the case in Florida?
Hi Michael,
Are you familiar with “smart meters” the power companies have been forcing on customers? They threaten power shut off if you don’t accept one of the new AMI (advanced metering) options and want to keep your analog meters instead. The meters are unsafe for health and safety reasons as well as a tremendous invasion of privacy. Josh del Sol’s documentary Take Back Your Power explains the problem beautifully.
More recently he has teamed up with others to fight back against these monopolies. The smart meter is the proving ground, but the belief is his method can work against any usurpation of power:
https://www.youtube.com/channel/UCBmSbCRd_Jj5NgV3xTwrkHA
The group is looking for mass awareness to take power back into our hands and fight the corporatocracy. Would love to see an interview with del Sol on LB.
The energy committee of our state legislature actually has a bill that would permit people to keep their analog meters, but the power cos have purchased opposition to this bill through “campaign contributions, ” and the power commission is a case study in Regulatory Capture. Dems in the legislature will be put in an awkward position, as the party seems to be embracing an “anti-monopoly” stance for 2018.
It is really fun, how they throw tantrum about “Russian hackers” and then force top install non-protected computer devices (AMI-s) in every household
Not sure about the rest of you folks, but my 7kw system is designed such that in a grid down situation, the inverters automatically depower. I have microinverters, one on each panel. When the power goes out, switchgear built into these inverters shuts them down. I then have to manually open my main, then generate 110 vac back to the panels to get the inverters to then operate. Once the inverters get the ac, they produce. That backs my generator down. I have no batteries of any kind, and FPL owes me money due to net metering. We get a 50% cost/sale price here in central Florida, and it does suck. But having spent 20 years of my working life in a rather high tech power plant, I can assure you we are lucky to get that. In nys, it’s like 17%. And that’s a state that gets three full days of sun per year!
I looked into getting a battery backup to my solar system for when the power goes out. The electricity coming from the panels varies in watts produced as the sun varies in strength and this intermittent power is not usable in the house when power goes out. So you first need to charge a battery and then draw power from said battery because the power from the battery is going to be stable. You also need this special switch that will not hook to the grid when you switch to the battery. It is physically impossible with the switch to have both hooked up at the same time thus saving a power line workers life.
The parts alone to make the whole system work was around $5000. A generator is around a $1000. The battery backup just didn’t make sense. Before a storm hit once I bought a $1000 generator. The power never went out and I never took it out of the box. I returned it to Home Depot the next day for a full refund. Problem solved.
That is the nice thing about being in my business. If the power actually goes out, I know enough about electric systems to wire up a generator in a few hours. So unless power goes out, no need to take it out of the box!!
Home Depot has a 30 day return policy.
Hi Michael, more info re: smart meters/smart grid:
Patrick Wood, Technocracy:
https://www.youtube.com/watch?v=MxSTmcwP4QI
Jeromy Johnson EMF wake up call:
https://www.youtube.com/watch?v=F0NEaPTu9oI
5G coming atchya:
https://www.youtube.com/watch?v=OMxfffqyDtc
Smart City Megatrend (holy s&*(&*!!)
http://www.egr.msu.edu/~aesc310-web/resources/SmartCities/Smart%20City%20Market%20Report%202.pdf
You might be aware of the above already, but your readers may not.
All hands on deck!
Best,
Shannon
Good topic. Good discussion. I am happy here in CA with my solar. It is like a nine percent tax free bond. I wish the rest of my investments were as good.
So this power company spent it’s 2 billion “upgrade” on bribes and gifts to politicians?
This is the precise reason I refused solar panels here in Nevada…I love the idea and one thing we have in abundance here is sunshine. But when I asked the aggressive type salespeople about whether I would have control of these solar panels, they gave me vague answers. It turns out no, I wasn’t going to have any say in what happened to the solar panels they installed on my roof: They were just going to bundle the heavily government subsidized price of the panels in with my electric bill, minus the net metering, and thus “save” me money. At the beginning of this year they dropped the subsidies and lowered the net metering. It’s all but killed the residential solar industry here in Nevada nobody wants them anymore electric bills are sometimes higher with the panels than without them. And this is in the desert, where we average like 340 days of sunshine a year, and still regulation has strangled the industry. For me the whole point is that I have control over the panels and that they are totally 100% off grid. I can’t fathom why else to do it…
Michael
I had an interesting conversation with my best friend who isworking for a start up company called Blue planet energy. The owner is an interesting entrepreneur named Henk Rogers from Amsterdam. He lives In Hawai‘i and has been 100% off the grid for a year. His company sells these battery to work with your solar system. Which are safer and warranties for 20 years. He created Tetris with a business partner many years ago. So he is not a fly by night
http://www.dailymail.co.uk/news/article-3150617/Owner-Tetris-rights-takes-Hawaii-home-ranch-grid.html
I live in Florida and would like to be energy independent but I heard so many stories about the power companies in FL. I want to be up and running when any Hurricane hits and bit have to rely on the power companies to restore me after a week of no service.