Many Voters Unaware of Costs
Robert Borlick is an energy consultant with more than 40 years of experience related to the electric power industry. He previously held partner-level positions in two international consulting firms, Putnam, Hayes & Bartlett, Inc., and Hagler Bailly, Inc. Recently he has conducted several studies that examine the subsidies that residential rooftop solar receives in various states.
Two years ago, while having lunch with a former Stanford Graduate School of Business classmate, I mentioned how expensive residential rooftop solar was in California. I also stated that residential customers without solar were largely paying for it through their higher electric bills. He stopped me in mid-sentence and blurted out, "Are you telling me that solar energy costs more than conventional energy? How can that be - the sun is free!"
Now, my friend is an educated professional. The fact that he was unaware of how much rooftop solar is costing the state's electricity consumers suggests that the average Californian doesn't have a clue.
Incentives in California
I was doing some research to estimate the incentives produced by the thirty percent federal tax credit when combined with California's net energy metering incentive (NEM). The estimates were for a typical residential customer living in Southern California.
I defined the NEM incentive as the present value of the customer's electric bill savings, less the present value of the costs the utility avoids due to the customer's solar energy production, over the twenty-five-year economic life of the rooftop solar facility.