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Solar panels costing California residents, why energy bills increased in 2024

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California’s solar panels are driving up electricity bills for residents while making power cheaper for customers in other states. The Golden State is producing more solar power than it can use, leading to significant energy waste and financial losses.

Over the past 12 months, California curtailed more than 3 million megawatt-hours of solar energy, enough to power over 500,000 homes for a year. This issue has grown as the state’s solar capacity increased about 20-fold over the last 11 years, with the amount of solar energy wasted in 2024 now more than doubling the total in 2021 and climbing eight times higher than in 2017.

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Experts estimate the retail value of the curtailed energy in 2024 exceeds $1 billion. California’s sunny climate is ideal for solar energy production, but peak demand typically occurs at night, leaving a portion of what is generated in the daytime unused.

Industrial-scale batteries, which could store excess energy for later use, are costly, often twice as expensive as the solar panels themselves. Most current systems only store energy for four hours, which is insufficient to meet overnight demand.

This oversupply contributed to California’s electric rates being around twice the national average, as residents effectively pay for unused power. Since 2021, the state’s largest utility providers have raised rates by 51%, but the situation could be worse if California was not sending some of its surplus solar energy to other states.

Ultimately, out-of-state utilities benefit more from this arrangement than Californians. For example, Arizona’s largest public utility saved $69 million in 2023 by purchasing California’s excess solar energy, passing the savings on to customers through bill credits. Similarly, New Mexico’s largest utility saved $34 million in 2022 by buying surplus solar power from California.

California’s increasing solar energy production also caused the price of electricity sold out of state to plummet. Prices have dropped so low that they occasionally become negative, forcing solar plants to pay energy traders to take the power.

Despite these challenges, California Gov. Gavin Newsom said he plans to add another 70 gigawatts of industrial solar capacity by 2045. The plan requires enough solar panels to cover an area nearly half the size of Rhode Island. The initiative aims to make California’s electrical grid carbon-free over the next two decades, but experts warn that high curtailment rates could hinder this goal.

Newsom’s advisers are exploring solutions, including expanding industrial-scale battery storage to save excess solar power for high-demand periods, attempting to direct more of those renewable energy benefits towards the Californians who paid for it.

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[Jack Aylmer]

SOLAR PANELS ARE DRIVING UP ENERGY BILLS FOR RESIDENTS IN CALIFORNIA-

WHILE ALSO MAKING ELECTRICITY PRICES CHEAPER FOR THOSE LIVING IN OTHER STATES.

THIS IS BECAUSE RIGHT NOW CALIFORNIA IS MAKING MORE SOLAR POWER THAN IT CAN USE.

OVER THE PAST 12 MONTHS, THE STATE HAS BEEN FORCED TO CURTAIL MORE THAN 3 MILLION MEGAWATTS WORTH OF SOLAR ENERGY-

ENOUGH POWER TO KEEP OVER HALF A MILLION CALIFORNIA HOMES RUNNING FOR A YEAR.

IT’S A PROBLEM THAT’S ONLY GOTTEN WORSE AS THE STATE ADDED MORE SOLAR PANELS, INCREASING ABOUT 20-FOLD OVER THE LAST 11 YEARS.

THE AMOUNT OF SOLAR ENERGY CALIFORNIA HAD TO WASTE THIS YEAR IS MORE THAN DOUBLE THE TOTAL IN 20-21-

AND AN EIGHT TIMES INCREASE FROM 2017 LEVELS.

EXPERTS CALCULATE THE RETAIL VALUE OF SOLAR ENERGY THAT THE STATE THREW AWAY IN 2024 IS WORTH UPWARDS OF A BILLION DOLLARS.

SOLAR ENERGY NEEDS SUNLIGHT TO PRODUCE POWER, WHICH MAKES CALIFORNIA’S SUNNY CLIMATE IDEAL FOR THIS RENEWABLE SOURCE.

BUT PEAK DEMAND USUALLY HAPPENS AT NIGHT, SO MUCH OF THE POWER BEING GENERATED DURING THE DAY GOES UNUSED.

CONSTRUCTING INDUSTRIAL-SIZED BATTERIES FOR STORING THE POWER TO UTILIZE LATER CAN BE TWICE AS EXPENSIVE AS THE SOLAR PANELS THEMSELVES.

AND THE SOLAR FARMS THAT DO BUILD THEM ARE MOSTLY BATTERY MODELS THAT CAN ONLY HOLD THE ENERGY FOR FOUR HOURS-

NOT LONG ENOUGH TO MAKE IT THROUGH THE NIGHT.

THIS TREND OF TOO MUCH SOLAR CONTRIBUTED TO CALIFORNIA ELECTRIC RATES BEING TWICE THE NATIONAL AVERAGE-

AS RESIDENTS ARE EFFECTIVELY MADE TO PAY FOR THE GENERATION OF POWER THEY AREN’T USING.

BECAUSE OF THAT, SINCE 20-21, THE STATE’S LARGEST UTILITY PROVIDERS HAVE RAISED THEIR ELECTRICAL RATES BY 51 PERCENT.

BUT IT COULD HAVE BEEN EVEN WORSE IF CALIFORNIA WASN’T GIVING SOME OF THAT EXCESS SOLAR ENERGY TO OTHER STATES.

ALTHOUGH, ITS A SETUP THAT BENEFITS RESIDENTS FROM THE STATE’S RECEIVING THAT EXTRA POWER MUCH MORE THAN IT DOES CALIFORNIANS.

FOR EXAMPLE, ARIZONA’S LARGEST PUBLIC UTILITY SAVED 69 MILLION DOLLARS LAST YEAR BY BUYING SOLAR ENERGY FROM CALIFORNIA-

WHICH THEY PASSED ON TO CUSTOMERS IN THE FORM OF A CREDIT ON THEIR BILLS.

IN 20-22, NEW MEXICO’S LARGEST PUBLIC UTILITY DID THE SAME-

SAVING 34 MILLION DOLLARS FOR THEIR CONSUMERS THAT YEAR AS A RESULT OF TAKING CALIFORNIA’S EXTRA SOLAR POWER.

MEANWHILE, THE INCREASING OVERSUPPLY OF ELECTRICITY FROM THIS RENEWABLE SOURCE IN CALIFORNIA HAS CAUSED THE PRICE AT WHICH IT CAN BE SOLD TO PLUMMET.

DROPPING SO LOW, IT BECOMES NEGATIVE-

MEANING SOLAR PLANTS IN CALIFORNIA ARE ACTUALLY PAYING ENERGY TRADERS TO TAKE THEIR POWER TO OTHER STATES.

DESPITE THESE CHALLENGES, GOVERNOR GAVIN NEWSOM STILL WANTS TO ADD ANOTHER 70 GIGAWATTS OF INDUSTRIAL SOLAR FARMS BY 20-45.

A PLAN WHICH WILL REQUIRE ENOUGH PANELS TO COVER AN AREA EQUIVALENT TO NEARLY HALF THE STATE OF RHODE ISLAND.

OVER THE NEXT TWO DECADES, THIS INITIATIVE AIMS TO MAKE CALIFORNIA’S ELECTRICAL GRID CARBON FREE-

BUT EXPERTS WARN THE STATE’S CURRENT CURTAILMENT RATES COULD HINDER THAT GOAL.

A PROBLEM NEWSOM’S ADVISERS ARE WORKING TO ADDRESS THROUGH BUILDING OUT MORE INDUSTRIAL-SCALE BATTERY STORAGE FACILITIES-

SAVING THAT EXTRA SOLAR ENERGY TO USE IN TIMES OF HIGH DEMAND BY THE CALIFORNIANS WHO PAID FOR IT.

TO GET MORE STORIES ABOUT RENEWABLE ENERGY CHALLENGES BOTH IN THE U.S. AND ABROAD, DOWNLOAD THE STRAIGHT ARROW NEWS APP AND SIGN UP FOR ALERTS FROM ME- JACK AYLMER.