Kona
Solar panels
Owners do not pay enough to cover expense
In the Feb. 14 edition of WHT, there were a couple of letters from concerned readers regarding the insufficient appreciation of people who installed solar panels on their rooftops.
I am in no way associated with HELCO. I was motivated by a profound lack of understanding in economics and utilization of the electrical grid distribution for renewable electricity that both letters expressed.
One letter stated all solar panel owners pay a $20 hookup fee and that amount is sufficient as a fair share assessment for the baseline expense of HELCO as a public utility. An average bill for an average household is around $200 per month. The baseline expense of HELCO’s existence (cost before even a single kWh is distributed) is based on the total energy currently distributed to the island, which is approximately 20 cents/kWh out of approximately 40 cents/kWh delivered. It means the baseline expense for an average house is $100/month (half of $200). Baseline expense is roughly payroll, profit (which in HELCO’s case is guaranteed by a contract with PUC, as approximately 20 percent of the margin) and materials needed for grid maintenance.
Obviously the $20 solar panel owners pay does not pay enough to cover HELCO’s baseline expense. They, in fact, are subsidized by the rest of the public who have no solar panels installed. The manufacturing of solar panels is subsidized by federal government (as an industry it would not survive on the market without those subsidies — remember Solyndra). Even installation of solar panels is subsidized through cheap loans, so it may become a “good” deal for an individual. Most of the individual systems installed are designed to cover the needs of the individual household and amount of electricity delivered to the grid is most likely not more than 20 percent of the energy for their own use.
In one word, solar panel owners have it good both ways: They have far lower energy consumption from the grid and they do pay less for grid use than the rest of us.
The entire renewable electricity generation situation is unfortunately a big governmental boondoggle needed only because we have unreasonably cheap oil thanks to indirect subsidies to “Big Oil.” This is made possible because of a tax that keeps our hypertrophied military capable of holding a knife under the throat of Middle East oil sheikhs who, because of fear, deliver us as much oil as we want. That oil is paid for with the money, which until now, served as world reserve currency and is currently in a slow but steady process of being eliminated from that role by the powers that are shaping up beyond our government’s control.
How long the whole shebang is going to last remains to be seen. When oil price becomes determined by a free market, without implied military threats to suppliers, renewable energy will be able to stand on its own, but that time is obviously not now.
Tony Radmilovich
Kona