If you are an SDG&E customer planning to install a solar system in your home this year, you’ll have to take time-of-use rates. This is the second big change for SDG&E solar customers, the first being the switch to new net metering rate structure for solar owners (NEM 2.0). How does Time of Use affect your rate increase?
Time of Use in 2020 and onwards
Time of use is the period in the day when the utility charges you more for the electricity they deliver you. The 24 hours in a day are divided into on-peak and off-peak periods, according to the demand (and strain) put on the grid. Until the end of 2017, on-peak hours were from 11 am to 6 pm, while today, in 2020, the on-peak is in the evening hours, from 4 pm to 9 pm.
So, even though the on-peak window is shorter now, many experts agree that it will make a considerable impact on SDG&E bills because that’s the time when people get home from work (turn on their ACs, TVs, computers, charge their cars through solar, etc.).
The SDG&E excuse for solar rate increase
Every three years California’s three utility companies request a rate increase from the California Public Utility Commission. They explain that the increase is related to higher costs of maintaining and upgrading the grid and the equipment. In other words, as the grid gets older and more expensive to maintain, the rates will continue to rise to compensate for utility’s expenses.
Another reason is also the duck curve, i.e. the shift in electricity demand that is brought about with the burgeoning number of residential solar systems. Since solar panels produce electricity during the day, the grid is under a bigger strain in the evening.
How can you offset the rate increase?
Install solar, if you already haven’t. SDG&E rates will not stop to increase in 2020. They are on an unrelenting and steady upward trend. Even though the net energy metering program NEM 2.0 is less favorable for solar owners than NEM 1.0, solar still does and always will make sense.
Not only does solar save the diminishing natural resources we have, but the mild and sunny climate of Southern California make San Diego homes the perfect spot for residential solar panels. On top of these important considerations, solar saves you your hard-earned money and will save you even more in the coming years, taking into account the constant rise of electricity rates.
The way you can mitigate the changes brought with NEM 2.0 and the rate increase is: minimize the overall energy consumption and shift your consumption as much as possible from the evening period to the middle of the day, or ideally from 12 am to 6 am. This is a lot easier if you have a solar battery that stores the energy produced during the day.
Reach out to Action Solar of San Diego
Action Solar of San Diego is your go-to solar installer in the San Diego metro area. Let us assess your energy consumption and give you an estimate of your solar project and the utility bill savings you could make toward travel, education, and life pleasures. Call us!