To help San Diegans better evaluate the cost-saving potential of installing solar electric power to their homes, CSE now offers an online bill calculator that gives the most complete picture of solar benefits geared specifically to San Diego Gas & Electric (SDG&E®) customers. Solar contractors also will find the calculator helpful in demonstrating the value of solar photovoltaic (PV) systems to clients.
CSE has assisted residents in San Diego County with installing solar since 2006 as local administrators of the California Solar Initiative for the California Public Utilities Commission. The new Solar Savings Calculator is the first to take into consideration new rules for net energy metering and time-of-use electricity rates now required by SDG&E for new residential solar installations.
“The value proposition for solar depends on lowering a homeowner’s monthly electricity bills,” said Christina Machak, CSE senior research analyst. “The calculator gives a household-specific look at what homeowners can shave off their monthly utility bills in actual energy and dollar savings.”
Compare costs before and after PV installation
The Solar Savings Calculator utilizes a household’s energy use derived from detailed Green Button data available from SDG&E and provides monthly estimated energy bill costs before and after installation of a solar PV system. The user also can adjust the projected costs and savings based on future electric rate changes proposed by SDG&E.
An important element of residential solar costs is net energy metering (NEM), a utility program under which any solar-produced electricity that is not needed to power a home is exported to the grid for credit. Credits can be used to buy energy from the grid at night or other times when a home needs more power than is being produced by the solar panels. If a system produces more electricity than a home consumes over the course of a year, the homeowner is paid for this excess production at a wholesale market price, which is lower than the retail price.
New time-of-use energy rates
Under new NEM 2.0 regulations, SDG&E customers who install solar are required to use time-of-use (TOU) energy rates that charge customers more in the afternoon than other times of day. TOU rates also affect the payback value of excess energy produced by a home’s solar system, with lower credits for energy generated during the lower-priced “off-peak” hours, such as at night and earlier morning.
“There wasn’t a tool available that provided a solar savings estimate based on a household’s existing utility bill and NEM 2.0 rules, so we decided to develop one that addressed both issues,” Machak said. “This calculator uses SDG&E rates but we could customize it for other utility territories or electric service providers.”
Utilities propose rate shift
Further complicating the future value of solar installations, SDG&E and California’s other two large investor-owned utilities, Pacific Gas & Electric and Southern California Edison, are proposing to shift the “on-peak,” or highest cost, times to later in the day to more closely align with the times when electricity demand is high. This change would mean that the credits earned by solar households in the middle of the day would be less valuable than they are now. However, the impact would be different for each household depending on the amount of energy used, the direction the PV system is facing and the time of day the electricity is consumed, according to Machak.
“In general, for new customers with solar PV who primarily use electricity in the evening and early morning when the sun is not shining, shifting the on-peak period would result in less savings,” Machak said.