Taxing Solar Panels for Providing Energy

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Alissa_Sal's picture
Joined: 06/29/06
Posts: 6427
Taxing Solar Panels for Providing Energy

Conservative group ALEC pushes stealth tax on homeowners who install solar panels | The Raw Story

An alliance of corporations and conservative activists is mobilising to penalise homeowners who install their own solar panels ? casting them as ?freeriders? ? in a sweeping new offensive against renewable energy, the Guardian has learned.

Over the coming year, the American Legislative Exchange Council (Alec) will promote legislation with goals ranging from penalising individual homeowners and weakening state clean energy regulations, to blocking the Environmental Protection Agency, which is Barack Obama?s main channel for climate action.

Details of Alec?s strategy to block clean energy development at every stage ? from the individual rooftop to the White House ? are revealed as the group gathers for its policy summit in Washington this week.

About 800 state legislators and business leaders are due to attend the three-day event, which begins on Wednesday with appearances by the Wisconsin senator Ron Johnson and the Republican budget guru and fellow Wisconsinite Paul Ryan.

Other Alec speakers will be a leading figure behind the recent government shutdown, US senator Ted Cruz of Texas, and the governors of Indiana and Wyoming, Mike Pence and Matt Mead.

For 2014, Alec plans to promote a suite of model bills and resolutions aimed at blocking Barack Obama from cutting greenhouse gas emissions, and state governments from promoting the expansion of wind and solar power through regulations known as Renewable Portfolio Standards.

Documents obtained by the Guardian show the core elements of its strategy began to take shape at the previous board meeting in Chicago in August, with meetings of its energy, environment and agriculture subcommittees.

Further details of Alec?s strategy were provided by John Eick, the legislative analyst for Alec?s energy, environment and agriculture program.

Eick told the Guardian the group would be looking closely in the coming year at how individual homeowners with solar panels are compensated for feeding surplus electricity back into the grid.
?This is an issue we are going to be exploring,? Eick said. He said Alec wanted to lower the rate electricity companies pay homeowners for direct power generation ? and maybe even charge homeowners for feeding power into the grid.

?As it stands now, those direct generation customers are essentially freeriders on the system. They are not paying for the infrastructure they are using. In effect, all the other non direct generation customers are being penalised,? he said.

Eick dismissed the suggestion that individuals who buy and install home-based solar panels had made such investments. ?How are they going to get that electricity from their solar panel to somebody else?s house?? he said. ?They should be paying to distribute the surplus electricity.?

In November, Arizona became the first state to charge customers for installing solar panels. The fee, which works out to about $5 a month for the average homeowner, was far lower than that sought by the main electricity company, which was seeking to add up to $100 a month to customers? bills. Gabe Elsner, director of the Energy and Policy Institute, said the attack on small-scale solar was part of the larger Alec project to block clean energy.

?They are trying to eliminate pro-solar policies in the states to protect utility industry profits,? he said.

The group sponsored at least 77 energy bills in 34 states last year. The measures were aimed at opposing renewable energy standards, pushing through the Keystone XL pipeline project, and barring oversight on fracking, according to an analysis by the Centre for Media and Democracy.

(SNIP - More at the link)

So to sum up, homeowners with solar power that are producing more energy than than they use are currently feeding their excess electricity back into the system, which, you would think would be a good thing for everyone. But this group wants them to have PAY to provide free energy back into the system....

Thoughts?

AlyssaEimers's picture
Joined: 08/22/06
Posts: 6560

I do not know enough about the topic to have an opinion. Why does the group not want their to be solar panels?

Alissa_Sal's picture
Joined: 06/29/06
Posts: 6427

Well, my cynical answer is because the money that backs them comes from the power companies who would rather force the homeowners to pay them, rather than paying the homeowners for their excess power.

mom3girls's picture
Joined: 01/09/07
Posts: 1533

We have solar panels that provide power back into the grid for about 75% of the year. This is not really new, every year that we have had them we have had something like this.

Alissa_Sal's picture
Joined: 06/29/06
Posts: 6427

Do you actually have to pay?

mom3girls's picture
Joined: 01/09/07
Posts: 1533

"Alissa_Sal" wrote:

Do you actually have to pay?

Some we have been able to fight, but we have had to pay. We still save a bunch of money on power so we are still coming out ahead at the end of the year.

Spacers's picture
Joined: 12/29/03
Posts: 4099

I think if you are connected onto the grid, even if you aren't using it that much or that often, then you absolutely should be paying some of the infrastructure costs that are normally rolled into rates. It's no different than someone who simply uses less electricity. You benefit from having that electricity available whenever you do need it, and you also benefit by being able to move your excess electricity to the grid which prevents your panels from getting fried if you don't have battery storage. You should help support the system. Only houses that are completely and permanently disconnected from the grid should be able to not pay infrastructure costs. But those fees need to be reasonable, too. Solar is clean power which helps lower overall pollution because most places still burn fossil fuels to produce electricity or at least peak generation. We should be doing anything we can to move away from global-warming fossil fuels.

mom3girls's picture
Joined: 01/09/07
Posts: 1533

So we should pay extra fees, on top of what we pay for our electricity in the 3 months we need it (which by the way we could store enough, but then we wouldnt be putting power into the grid if we did) And more fees on top of the taxes?

Joined: 03/14/09
Posts: 624

I think they don't understand the definition of a free rider. A free rider is someone who takes from others without giving back- like vaccine refusers who let people who vaccinate create herd immunity so their kids are safer. If you are purchasing your own solar panels, at a large expense, and letting your resource power yourself or others, you are giving back. Exact opposite situation.

Alissa_Sal's picture
Joined: 06/29/06
Posts: 6427

"Spacers" wrote:

I think if you are connected onto the grid, even if you aren't using it that much or that often, then you absolutely should be paying some of the infrastructure costs that are normally rolled into rates. It's no different than someone who simply uses less electricity. You benefit from having that electricity available whenever you do need it, and you also benefit by being able to move your excess electricity to the grid which prevents your panels from getting fried if you don't have battery storage. You should help support the system. Only houses that are completely and permanently disconnected from the grid should be able to not pay infrastructure costs. But those fees need to be reasonable, too. Solar is clean power which helps lower overall pollution because most places still burn fossil fuels to produce electricity or at least peak generation. We should be doing anything we can to move away from global-warming fossil fuels.

I would say that you *are* paying your access to the grid. You're paying for it in electricity! That's a valuable resource that the power companies are selling to other houses that they now don't have to pay to produce. It's a win win scenario for everyone involved. It makes no sense to me that home owners should have to pay to GIVE the power companies power.

Spacers's picture
Joined: 12/29/03
Posts: 4099

"mom3girls" wrote:

So we should pay extra fees, on top of what we pay for our electricity in the 3 months we need it (which by the way we could store enough, but then we wouldnt be putting power into the grid if we did) And more fees on top of the taxes?

For nine months of the year you are connected to the grid and have that fall-back available to you if your panels don't work, and you don't have to rely on battery storage to deal with any excess voltage you create. During those nine months, yes, I think you should be paying a reasonable fee to stay connected to the grid because the costs of maintaining the grid don't stop just because your energy consumption does. If you don't want to subsidize the grid, then get off it completely.

Spacers's picture
Joined: 12/29/03
Posts: 4099

"Alissa_Sal" wrote:

I would say that you *are* paying your access to the grid. You're paying for it in electricity! That's a valuable resource that the power companies are selling to other houses that they now don't have to pay to produce. It's a win win scenario for everyone involved. It makes no sense to me that home owners should have to pay to GIVE the power companies power.

No, the power company pays you for the electricity you produce, just as they pay anyone else who produces electricity for them. You aren't donating it to the grid. That would be a completely different scenario.

mom3girls's picture
Joined: 01/09/07
Posts: 1533

"Spacers" wrote:

For nine months of the year you are connected to the grid and have that fall-back available to you if your panels don't work, and you don't have to rely on battery storage to deal with any excess voltage you create. During those nine months, yes, I think you should be paying a reasonable fee to stay connected to the grid because the costs of maintaining the grid don't stop just because your energy consumption does. If you don't want to subsidize the grid, then get off it completely.

I dont mind subsidizing the grid, nor do I mind the money that I pay for the 3 months that we dont produce enough with our panels. I do mind the extra fees that have been assigned to us on top of the cost of the panels (which was $16000) BTW, we could produce enough during those 3 months, but we would have to cut down trees to do it.
If we chose to go off grid, we would not be helping the community with what we add to the grid. But we also would be taxed for our panels. This doesnt encourage people to install these panels that in our area of the country could potentially reduce the production of electricity

mom3girls's picture
Joined: 01/09/07
Posts: 1533

"Spacers" wrote:

No, the power company pays you for the electricity you produce, just as they pay anyone else who produces electricity for them. You aren't donating it to the grid. That would be a completely different scenario.

The electric company here doesnt pay people for overages, they just bank it for when people need to use it. If you never need extra power you get no compensation, but you do pay extra taxes

Alissa_Sal's picture
Joined: 06/29/06
Posts: 6427

"Spacers" wrote:

No, the power company pays you for the electricity you produce, just as they pay anyone else who produces electricity for them. You aren't donating it to the grid. That would be a completely different scenario.

Re-read the article. It directly says that not only do they not want to pay the homeowners for the power, they want to charge the homeowners for uploading power to the grid. That's crazy talk to me!

Spacers's picture
Joined: 12/29/03
Posts: 4099

That's crazy talk to me, too!

KimPossible's picture
Joined: 05/24/06
Posts: 3309

"Spacers" wrote:

No, the power company pays you for the electricity you produce, just as they pay anyone else who produces electricity for them. You aren't donating it to the grid. That would be a completely different scenario.

Yeah thats just not the way it works in most places. We just got solar panels and our electricity surplus goes back into the grid. If we use less than what we produce, we get a credit. That credit is available to you up to 12 months, at which point you lose it. Its a rolling thing, so its not like you just lose any surplus on Jan 1st of the year. If I generate a surplus in march, the credit for that surplus is available to me until next march.

So while we don't get paid, its not really a flat out donation either, it might be at some point...but we have a year to use up what credit we accumulate per month.

Either way, unless everyone pays a monthly fee for being hooked up to the grid, whether they use power or not, i don't think it makes sense for those producing their own power to pay a fee. If joe schmoe leaves his house for a month and shuts everything down and doesn't get an electric bill for simply being 'hooked up'...why should i?

ETA: Also i tried to find different sources for this story and the very few sources I found were all weird. I don't think this is something i am too concerned about at the time. Not saying we can't debate it...just saying i'm not too concerned. Smile

Spacers's picture
Joined: 12/29/03
Posts: 4099

The credit you get *is* paying you for the electricity you are producing. And everyone else pays for maintaining their access to the grid, through their regular rates. In areas with a high vacation home population, it's quite standard to have a small monthly service fee to maintain your account. The company is still making sure safe & reliable electricity is available whenever you show up to use it, and it's fixing the line to your house if it blows down in a storm, whether you are there using the electricity or not, and those things cost money. Otherwise overall rates would have to be higher to account for half the population not being there half the time.

KimPossible's picture
Joined: 05/24/06
Posts: 3309

"Spacers" wrote:

The credit you get *is* paying you for the electricity you are producing. And everyone else pays for maintaining their access to the grid, through their regular rates. In areas with a high vacation home population, it's quite standard to have a small monthly service fee to maintain your account. The company is still making sure safe & reliable electricity is available whenever you show up to use it, and it's fixing the line to your house if it blows down in a storm, whether you are there using the electricity or not, and those things cost money. Otherwise overall rates would have to be higher to account for half the population not being there half the time.

I could totally understand as more people move to solar (the rates are really not that high right now) that they may have to change to a different pricing model...but i don't think that they should charge solar customers something for being hooked up that they don't charge everyone. Either work you fees like that, or not. But don't charge someone who makes energy and put it back into the grid something you wouldn't charge someone who doesn't use any energy AND doesn't put any into the grid. That would make no sense.

We are no where near a point where half the population isn't there half of the time. We actually just had an open house yesterday for information to those who are interested in it, staffed by the people who put in our panels....interest is definitely growing, but it is still such a small portion of houses actually even considering doing this due to so many factors.

As for just flat out taxing people? I think its terrible idea....taxes are a deterrent, the last thing that you need right now is deterring people from seeking out alternative energy sources. What do we do when someone is doing something that we don't want them to do...but we also don't want to make it illegal? We tax them.

And i'd still argue that solar panel uses do pay....because a)Any energy that is generated and fed back into the grid gets added to the general pool of energy...it is energy NOT produced by the electric company. and b)If i do have a surplus that doesn't get used, it will eventually just be taken by the electric company anyway.

Really the idea that we should be deterring people from moving to solar is kind of baffling to me, even if its a secondary effect, not a primary goal. I suppose if one is only looking out for the electric companies and nothing else it makes total sense.

Spacers's picture
Joined: 12/29/03
Posts: 4099

I'm all for solar panels and clean energy; don't get me wrong about that! If I owned a home, I'd install them!

What I am not for is people connected to the grid not helping support it. Our country's electric grid is very costly to maintain, and it can be catastrophic when it fails, physically and financially. People die when they don't have heat in winter, and stores lose money when they can't open because their scanners & registers & credit card machines aren't working. When you aren't paying for your electricity, you aren't paying to help support the grid; it's that simple. We don't need to change the rate structure for everyone else to fix this small problem. It's as easy as, for any month your meter nets out to zero, or you earn a credit, you automatically get charged a *reasonable* connection fee. If you don't like paying to help support the grid, then take your house completely off the grid.

KimPossible's picture
Joined: 05/24/06
Posts: 3309

"Spacers" wrote:

I'm all for solar panels and clean energy; don't get me wrong about that! If I owned a home, I'd install them!

What I am not for is people connected to the grid not helping support it. Our country's electric grid is very costly to maintain, and it can be catastrophic when it fails, physically and financially. People die when they don't have heat in winter, and stores lose money when they can't open because their scanners & registers & credit card machines aren't working. When you aren't paying for your electricity, you aren't paying to help support the grid; it's that simple. We don't need to change the rate structure for everyone else to fix this small problem. It's as easy as, for any month your meter nets out to zero, or you earn a credit, you automatically get charged a *reasonable* connection fee. If you don't like paying to help support the grid, then take your house completely off the grid.

No you should change the rate and pricing structure, because now you are saying "it doesn't matter how much energy you use, a lot or none at all or anything in between, there is is part of this that is going to go towards infrastructure and maintanence simply for wanting it available and being hooked up to it"

In no way do i want to be charged a fee if someone who uses a little electricity some month doesn't have to pay the same fee and doesnt' even come close to making it up in usage just because they don't have solar panels. Thats silly. And i don't want to be be paying a fee if someone shuts their electricity off for a month and doesn't use any...even though they could. One should not be penalized for having solar panels and giving energy back to the grid in a way someone who is just a regular old utility user can't.

Unless you are suggesting that my fee would be so minimal that it would be even less than someone who uses hardly any electricity at all (then whats the point?)

Joined: 08/17/04
Posts: 2226

I agree Kim. If I have to pay an access fee and that's a general fee for all users then I think it is fine for solar panel owners to pay the access fee as well if they are hooked up to the grid. I would support this for seasonal users too. Your house is still on the grid and may require repair or something else.

If it's not a general fee to all users it shouldn't be applied to solar panel users who put energy back into the grid.

KimPossible's picture
Joined: 05/24/06
Posts: 3309

Just checked with Seamus and there already is a minimum monthly fee through our electric company...which is true for everyone who is a customer of theirs...So it works exactly as I envisioned, and that makes sense to me. I see no need for any other fees against those with solar panels.

mom3girls's picture
Joined: 01/09/07
Posts: 1533

"Spacers" wrote:

I'm all for solar panels and clean energy; don't get me wrong about that! If I owned a home, I'd install them!

What I am not for is people connected to the grid not helping support it. Our country's electric grid is very costly to maintain, and it can be catastrophic when it fails, physically and financially. People die when they don't have heat in winter, and stores lose money when they can't open because their scanners & registers & credit card machines aren't working. When you aren't paying for your electricity, you aren't paying to help support the grid; it's that simple. We don't need to change the rate structure for everyone else to fix this small problem. It's as easy as, for any month your meter nets out to zero, or you earn a credit, you automatically get charged a *reasonable* connection fee. If you don't like paying to help support the grid, then take your house completely off the grid.

Our excess energy does support the grid. I dont mind the fees the power company charges me, I think of our relationship is symbiotic. But now our city is trying to charge a fee, and the county. Then there was an "energy tax" imposed last year on our panels as well.

KimPossible's picture
Joined: 05/24/06
Posts: 3309

"mom3girls" wrote:

Our excess energy does support the grid. I dont mind the fees the power company charges me, I think of our relationship is symbiotic. But now our city is trying to charge a fee, and the county. Then there was an "energy tax" imposed last year on our panels as well.

Lisa what state do you live in? What is the tax based on or how is it assessed? Just curious. We don't have that here.

mom3girls's picture
Joined: 01/09/07
Posts: 1533

"KimPossible" wrote:

Lisa what state do you live in? What is the tax based on or how is it assessed? Just curious. We don't have that here.

I am in Oregon. Part of the excess tax is for the increased amount on my home's assessed value, so my property taxes went up. I can handle that. The extra taxes assessed by my city and county are from a loophole that basically allows them to charge for "significant" structural changes. We did pay for permits, so this fee is different. I am not sure what the other fees or taxes are labeled under

KimPossible's picture
Joined: 05/24/06
Posts: 3309

AH ok, so none of them specifically have to do with the fact that its solar energy related, but instead the solar panels fall under some other category of things that are taxable.

mom3girls's picture
Joined: 01/09/07
Posts: 1533

"KimPossible" wrote:

AH ok, so none of them specifically have to do with the fact that its solar energy related, but instead the solar panels fall under some other category of things that are taxable.

Yes. My in laws use some thermal energy to heat and cool their cabin (it is in a community kind of) and they are taxed for the equipment used too.

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