Discussion on:

Home microgrids by the kilowatt-hour

It's not clear to me how this is better than financing a loan to install your own solar cells which you own. If you own the solar cells you get all the tax credits, and there are many local, state, and national programs to subsidize the actual loan by doing such things as providing a lower interest rate. You also get the same lower costs for transmission and distribution that Gen110 claims. If you allow Gen110 to put their solar cells on your roof, do you get to charge Gen110 rent? And if Gen110 has to make a profit, how is that cheaper in the long run than doing it all yourself and essentially pocketing what would be profit to Gen110?

Also, if the average customer saves $50,000 over 20 years, that's $2500 per year. In the example bill shown for November/December 2011 the total was $239. This is a winter bill, so summer will be much higher, but even so the solar cells would have to provide 100% of winter power and a big chunk of summer power to save the $2500.

Here in Colorado, the average annual electric bill is around $800. From the provided bills, it looks like California's baseline rates are about the same. The difference is in the tiered rates, which reach up to 33 cents per KWH. Colorado just put in tiered rates, but these are only in effect during the three summer months. The California rates are obviously punitive and several times the actual cost of production.

Apparently the only way solar cells make a lot of sense is in environments such as California's where the rates are way above the actual cost. In effect these artificially high rates are an indirect subsidy to companies such as Gen110, and once again you might as well take advantage of that subsidy yourself if you can by installing your own solar cells.

If you compare the hard numbers, many homeowners will spend exactly what they would to purchase a system by enrolling in a program like this. That is because companies like Gen110 will keep consumer costs down because they get the rebate for purchasing the system. Second, all maintenance and monitoring is included for 15 to 20 years. The reason why these companies can provide this service at the same cost to the homeowner is the classic bulk-buying principle. Distributed energy companies are able to purchase many PV system at a bulk cost price, unlike a homeowner. The result is providing a service that is the same cost as purchasing a system, without the added responsibility of monitoring your system's output, hiring maintenance crews, or replacing inverters over time.

Additionally, a distributed electricity company would have no incentive to keep a PV system after the term of a homeowner's agreement. Many of them anticipate handing over ownership to the homeowner, which is an extra advantage because many of the systems will last way longer than 20 years.

This is simply the logical progression of this technology. 20 years ago, people would purchase their own satellite dishes for $10,000. Now, nobody does that. Instead, Dish Network provides the service at a way lower price.