There is occasional news that conventional electric utility is in a death spiral. The logic goes like this: More people are putting solar panels on the roofs of their homes because the cost of solar installations coming down thanks to generous state subsidies along with improved manufacturing efficiencies at the solar-panel companies. Then, as those home owners require less power – presumably they might sell surplus power back to the utility – the power company will generate less income. To cover their expenses, they will increase their rate with PUC blessings, which is happening now, which will encourage more to install private-power systems. Eventually, the utility goes out of business because no one needs their service.
Nonsense. For those times that the sun and wind do not cooperate, they will require a utility connection that will not be free.
Consider an 8-panel (245 Watts/panel) solar array that might fit on a roof. At noon, it might produce 1,960W. If static (not motorized to face the sun) it would only produce about 16 kWh on the best of days. An online cost calculator says the 8-panel system with subsidies would cost $8,438 for a 16 year ROI. Our May bill shows we used 645 kWh in 31 days, about 21 kWh per day in a month that required little air conditioning or heat. So there is at least a 5 kWh shortfall.
The shortfall might not be there in a decade if power demands continue dropping. For example, a 6.5W LED light puts out the same light as a 60W incandescent bulb, and a recent big-screen TV draws 168W versus 250W for an older version of same size. This power-reduction trend will continue for many devices so that a home will need less power and the 5 kWh difference will shrink and possibly disappear.
But schools, factories, businesses, and hospitals will insist on greater reliability than the sun and wind can provide, so they will remain utility customers. Furthermore, there is a change coming in transportation that will put greater demand on the utility grid: electric and fuel-cell vehicles.
You can see the trend now in the sales of plug-in hybrid cars and all-electric vehicles such as the Tesla Model S, the Chevy Volt, and Nissan Leaf. We are now witnessing the rebirth of the EV, and California, with notoriously high gas prices, is a sales leader. And who would you rather thumb your nose at: your local utility or an international oil company? I’ll bet it’s the oil company.
Here’s why oil companies should worry and electric utilities can relax. A modest plug-in-electric, such as the Chevy Volt, uses a 23-kWh battery that provide about 40 miles of electric driving before the motor comes on. At $0.15/kWh (and 100% efficiency) it would take (23 x 0.15 =) $3.45 to recharge the Volt, and more practically closer to $5 for a “refill”. Tesla’s model S uses a 60 kWh battery that would take $9 to recharge. Batteries with higher energy densities are in the news every week. Now add the demands of an EV to a home electric grid and the necessity of an electric utility becomes clearer.
The fly in this ointment, however, is the time it takes to recharge. It’s excessive. Even the Chevy Volt takes more than 8 hours to recharge on a 120V service, although the problem becomes more manageable with 240V chargers. This is an opening for fuel-cell vehicles. Their fuel will most likely be hydrogen, electrolyzed from water. In this case, a little more power will be needed than an EV of equivalent range because I suspect there are lower efficiencies in the electrolyzer and the fuel cell.
You would think the utilities would do themselves a great favor if they would just encourage the sale of EVs with promotions for charging stations. For instance, imagine hearing this on the TV: “South Park Mall has just announced its first EV charging station. A spokesman for Second Energy points out that 20% of its power is generated by company-owned wind farms, so come on down and recharge your car with wind power.”
The transition away from fossil fuel to electric vehicles has begun and will take at least a generation to reach 30% of sales. Applications for each fuel will remain. For instance, I cannot envision a hospital relying on an all-electric ambulance, at least not in the near future, and electric utilities might take the hint dropped here. You never know. Stranger things have happened.
Filed Under: News