Unbelievably Low Electricity Rates

SolarJohn · June 2008

Electricity at less than 1 cent per kwh? My electricity provider must have lost its mind! As a participant in Ameren Electrics "PowerSmart Pricing Plan" my rates fluctuate from hour to hour, depending on demand at the time. From 2:00am until 4:00am yesterday my rates were under 1 cent per kwh. From 4:00am until 6:00am my rates were just slightly more than 1 cent per kwh. The highest cost for the day was just over 11 cents per kwh at 3:00pm. For the entire day, my rate averaged under 6 cents per kwh.

I'm taking advantage of these exceptionally low nighttime rates by topping off the charge on my batteries while rates are at their lowest, and using the stored energy when rates are higher. I suspect that I'm coming out ahead, even when considering system losses.

You can get more information at the Power Smart Pricing website:

www.powersmartpricing.org

or on my blog at:

http://solarjohn.blogspot.com

John

icarus · June 2008

Re: Unbelievably Low Electricity Rates

That is the way it should be. If they would buy back your power at same structure it is perfect. You can sell to the grid when it is expensive, buy it at night when you need it when it's cheap.

See my post about plug in hybrids in the "how do we ge more people into solar" thread.

Icarus

SolarJohn · June 2008

Re: Unbelievably Low Electricity Rates

For Ameren to sell electricity at a penny per kwh suggests that it only costs a penny per kwh to produce it. Could that be true? Otherwise, why would they sell electricity for less than it costs to produce?

This appears to be a good thing for those with grid-tied systems. When they're using grid power they're getting it cheap, and when their selling power to the grid they're doing it at a higher rate. This also bodes well for V2G technology.

On the other hand, why do I need solar panels at all? I could just spend the money instead on more batteries/storage, and continue to buy cheap and sell high.

John

icarus · June 2008

Re: Unbelievably Low Electricity Rates

Your are sorta correct.

It costs them more than $.01 per kwh to produce, but, and this is a big but, the most expensive power is that that is not used. In other words, the idling spinning capacity. The power plant that must stay fired up and on line to allow the the next light switch to be turned on.

So over night, there is (mostly) always idle spinning capacity. Power companies try very hard to sell whatever they can of this capacity, as well as dialing down out put as much as they can. (Much easier to do with hydro than steam fired).

As to just using the battery bank, and buying low and selling high, a strategy for sure, but if you calculate the cost of your batteries and their charging systems, I'm not sure you really win. Also if everyone did it, the overnight price would go up with demand.

The best idea (In my mind) is to sell PV when the price is high, and by back when the price is low. If you can get this real time of day metering, then the "pay-off" of PV comes much sooner then just net metering.

Icarus

niel · June 2008

Re: Unbelievably Low Electricity Rates

i would really love for my utility to offer something like this as i'd be using such things as my washer and electric dryer during those times to name a few. i'd also go with storing much power in batteries in spite of the battery costs as a hedge on the power outage possibility and cycling that power for some use during the day making it more cost effective imho for something many of us do anyway, but with pvs as the power source and their higher cost for their purchase. this still benefits pv gt only systems as they sell high and use cheap.

nigtomdaw · June 2008

Re: Unbelievably Low Electricity Rates

Total up the battery cost and have a coffee, everything adds up but batteries

SolarJohn · June 2008

Re: Unbelievably Low Electricity Rates

Thanks for the replies.

It's 11:50pm right now,and my current rate is 0.017450. It'll be even lower in a few minutes. I've just started doing some laundry. I'm also topping off the charge on my spare battery bank. Now if I could just buy gasoline cheap late at night I'd have it made!

John

rickeolis · June 2008

Re: Unbelievably Low Electricity Rates

I'm with Niel,
Store what you can using batteries charged at those times.
Not that I don't do a similar thing where I live... (9 cents at night vs. 13 in day)

-Rick-

SolarJohn · July 2008

Re: Unbelievably Low Electricity Rates

SolarJohn wrote: »

Electricity at less than 1 cent per kwh? My electricity provider must have lost its mind! As a participant in Ameren Electrics "PowerSmart Pricing Plan" my rates fluctuate from hour to hour, depending on demand at the time. From 2:00am until 4:00am yesterday my rates were under 1 cent per kwh. From 4:00am until 6:00am my rates were just slightly more than 1 cent per kwh. The highest cost for the day was just over 11 cents per kwh at 3:00pm. For the entire day, my rate averaged under 6 cents per kwh.

I'm taking advantage of these exceptionally low nighttime rates by topping off the charge on my batteries while rates are at their lowest, and using the stored energy when rates are higher. I suspect that I'm coming out ahead, even when considering system losses.

You can get more information at the Power Smart Pricing website:

www.powersmartpricing.org

or on my blog at:

http://solarjohn.blogspot.com

John

It gets even stranger - - - My utility company is actually paying me to use electricity! The details are here: http://www.powersmartpricing.org/pdf/Update-20080730.pdf

See page 2.

John

BB. · July 2008

Re: Unbelievably Low Electricity Rates

Although the Real Time Pricing looks interesting--and is market driven (supply and demand signals are usually much better than somebody at the state public utility commission setting prices)--I have some strong reservations...

Basically, this is buying power on the spot market--same as buying gasoline today--and what killed California back in ~2000 when the state drove our electric utilities into near bankruptcy and took out $25,000,000 in 40 year bonds to pay for a summer of "spot market" power...

Looking at the Real Time Prices for Solar John's utility--they are between $0.02 and $0.13 per kWhr for TODAY. And back in January of 2008--the peaks may even be $0.07 per kWhr (just looking at random dates).

All is well and good--but if (or when) the market inverts (like it did big time in California)--watch out...

And, in any case, this appears to be a relatively low cost supplier of power. What will people do when the power costs exceed $0.50 per kWhr (my "PUC Approved" Rate Plan already peaks at $0.53 per kWhr in the summer)... I am not sure that people will be quite prepared for spot market pricing.

Contracted delivery pricing (which is what a PUC more or less does) allows utilities, generators, and fuel suppliers to meet forcasted demand with a relatively firm customer base. In California, when that was broken (through the use of www.caiso.com)--there were zero generating stations built in the state for years (decade or more?).... With normal population growth and the additions of A/C and computers--it was only time until stuff hit fan.

It was interesting to look at the Ameren FAQ--In Illinois, a "low use" is around 5,000 kWhrs per month or less (that would get you a ~$1,500 per month electric bill in California). In may area (Zone "X", with natural gas--PDF download), low use (or baseline) is ~360 kWhrs per month (~$45 per month and excessive use is 3x baseline usage)...

When Real Time Pricing hits California (and it will, probably in the next few years)--the regulatory environment of the utilities and their power suppliers is going to really need to be looked at to ensure that "2000" does not hit us again. It took about 4 years from the time that the "deregulation laws" where signed until the state almost destroyed our utilities and electrical infrastructure.

-Bill

Unbelievably Low Electricity Rates

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