Reports of Plain Old Power Service’s death greatly exaggerated
Steve Huntoon is the principal of Energy Counsel, LLP. Mr. Huntoon is a former president of the Energy Bar Association, and for over 30 years of practice in energy regulatory law he has 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 and Exelon).
POPS, Plain Old Power Service, is here to stay.
Forecasts of the impending death of traditional electric utility service abound. Disrupters are seen everywhere, led by home solar and home batteries, the two horsemen of the utility apocalypse.
Regulators in our two largest states, California and New York, are planning an overhaul of the industry based on these "Distributed Energy Resources." How real is the threat to POPS? Home solar, as exemplified by SolarCity, doesn't make economic sense outside of California and Hawaii with their high utility rates and the net metering that provides distribution and storage services for free.1
With the pushback against net metering, the phase-out of the solar investment tax credit, and low natural gas prices driving down utility rates, home solar has a bleak future.2
Of course solar itself has a future. But the problem for home solar is that it costs almost three times as much per kilowatt as utility-scale solar, as shown in Figure 1 from GTM Research/Solar Energy Industries Association.