One of the advantages of solar that doesn’t get much publicity is the fact that a properly sized solar system can protect you from future rate increases by your utility company. The rates have been going up 5% every year since PG&E has been publishing their historical rates on their website. https://www.pge.com/tariffs/rateinfo.shtml

It takes a little work to extract this information exactly, but look at your bill. On about page three, you will see your current rate plan. It is in the upper left, under your name and address. Look on the website for that rate in the past and present. You will see a vast difference.

A solar system in California is able to take advantage of a law passed back when the utility companies didn’t think solar would ever get popular called Net Energy Metering, or NEM. This allows a solar customer to ask PG&E to install a meter that reads in both directions. When you are generating electricity during the day, and not using as much as you are generating, you will get full retail credit for those kWh heading back to the grid. Therefore as the rates go up, you will get more credit for every kWh you generate more than your usage at that time.

The important thing to remember is that in order to take full advantage of this benefit for solar customers, you must have a solar system large enough to cover your annual kWh usage. Any generated electricity you still have to purchase from the utility company will be at the new higher rates.

There are three types of charges that the utility companies charge that are not included in NEM. The first is a monthly meter charge. This ranges from $10 a month for residential customers to over $500 a month on large industrial customers. The second is a category of charges called “non-bypassable charges”. This includes the charges on your bill for repayment of bonds from the past, Public Purpose Programs, and items like that. This amounts to about 10% of the usage rate. There is also a demand charge, which is only applicable to medium to large commercial and industrial customers. This is based on the highest amount of electricity you bought during any 15 minute time period during the month. The demand charge is typically 25% to 30% of the total bill. The good news is that there are now renewable versions of these rates that greatly reduce this demand charge for customers with solar systems.

So the answer is, yes, solar does protect you from future rate increases. However, unless you are on the right rate and your system is sized to cover your annual usage, you will still suffer through some rate increases.