If you provide free storage and distribution services, too much will be used, and costs for everyone else will go through the roof(top).
Steve Huntoon is the principal of Energy Counsel, LLP. He is former President of the Energy Bar Association, and for over 30 years of practice in energy regulatory law advised and represented such companies and institutions as Dynegy, PECO Energy (now part of Exelon), Florida Power & Light (NextEra Energy), ISO New England, Entergy, PacifiCorp, Williston Basin (MDU Resources) and Conectiv (now part of PHI).
This is a cautionary tale of two curves. The first is California's now-famous Duck Curve, shown in Figure 1. Let's understand what it depicts, and why it's happening.
The Duck Curve depicts net load, which is gross load net of renewable resource generation (primarily solar). Stated differently, this net load represents the portion of customer demand that is greater than available renewable energy, so that it must be served by other resources, such as conventional thermal generation (or perhaps by energy storage).
As renewable resource generation increases, this net load gets smaller in the afternoon and greater in the evening. The neck of the Duck Curve gets longer every year due to California's energy policies, especially net metering subsidies in the form of free storage and distribution services. By the year 2020 it looks more like a goose, so maybe it should be called (did you see this coming?) the Duck, Duck, Goose Curve.
There are lots of ways to deal with this, such as (perish the thought) reforming the net metering subsidies. Another option: getting rid of existing time-of-use rates which, counter-productively, charge high prices when net load is low and charge low prices when net load is high (e.g., Southern California Edison's Rate TOU-D-T with high prices from 12-6 pm and low prices after 6 pm).1