It’s not cheaper in reality. Net metering is effectively a major subsidy that goes away pretty much everywhere that solar generation starts to make up a significant fraction of the supply.
Electricity companies don’t want to pay all that capital expense, so it makes sense for them to shift it onto consumers up until home solar generation starts approaching daytime demand. After that point, they can discontinue the net metering and push for “smart meters” that track usage by time of day and charge or pay variable amounts applicable for that particular time, and/or have separate “feed in” credits that are radically smaller per kWh than consumption charges (in practice often up to 85% less).
With smart meters and cheaper home battery systems the incentives starts to shift toward wealthier solar enthusiasts buying batteries and selling excess power to the grid at peak times (or consuming it themselves), lowering peak demand at no additional capital or maintenance cost to the grid operators.
In principle the endgame could involve no wholesale generators at all, just grid operators charging fees to net consumers and paying some nominal amount to net suppliers, but I expect it to not converge to anything as simple as that. Economies of scale will still favour larger-scale operations and local geographic and economic conditions will maintain a mixture of types and scales of generation, storage, distribution, and consumption. Regulation, contracts, and other conditions will also continue to vary greatly from place to place.
If the cost of power generation were the main contributor to the overall cost of the system then I think you’d be right: economies of scale and the ability to generate in cheap places and sell in expensive places would do a lot to keep people on the grid. But looking at my bill (footnote [1]) the non-generation costs are high enough that if current trends continue that should flip; see my response to cata, above.
It’s not cheaper in reality. Net metering is effectively a major subsidy that goes away pretty much everywhere that solar generation starts to make up a significant fraction of the supply.
Electricity companies don’t want to pay all that capital expense, so it makes sense for them to shift it onto consumers up until home solar generation starts approaching daytime demand. After that point, they can discontinue the net metering and push for “smart meters” that track usage by time of day and charge or pay variable amounts applicable for that particular time, and/or have separate “feed in” credits that are radically smaller per kWh than consumption charges (in practice often up to 85% less).
With smart meters and cheaper home battery systems the incentives starts to shift toward wealthier solar enthusiasts buying batteries and selling excess power to the grid at peak times (or consuming it themselves), lowering peak demand at no additional capital or maintenance cost to the grid operators.
In principle the endgame could involve no wholesale generators at all, just grid operators charging fees to net consumers and paying some nominal amount to net suppliers, but I expect it to not converge to anything as simple as that. Economies of scale will still favour larger-scale operations and local geographic and economic conditions will maintain a mixture of types and scales of generation, storage, distribution, and consumption. Regulation, contracts, and other conditions will also continue to vary greatly from place to place.
If the cost of power generation were the main contributor to the overall cost of the system then I think you’d be right: economies of scale and the ability to generate in cheap places and sell in expensive places would do a lot to keep people on the grid. But looking at my bill (footnote [1]) the non-generation costs are high enough that if current trends continue that should flip; see my response to cata, above.