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You have the right to generate your own electricity

Steven Weissman, associate director, Center for Law, Energy and the Environment | December 4, 2015

Do people have the right to generate electricity for their own use and still remain connected to the grid? Of course they do. You see it every day. Without prior registration or a background check, anyone can go into a hardware store and buy a diesel generator. Homeowners and businesses can install rooftop solar photovoltaics and enjoy the benefits of low-carbon energy. A business can install backup generation to ensure that it can rely on a steady supply of power.

solar panelsIn fact, this right is so self-evident, that one would be hard-put to find a state that has bothered to mention it in a statute or in its constitution. So, why is it even worth mentioning? Because as solar photovoltaics become more cost-competitive, electric utilities across the country are working overtime to find a way to interfere with that right.

It is Jon Wellinghoff, the former Chair of the Federal Energy Regulatory Commission, who first brought this issue to my attention. With the help of three Berkeley Law graduates, he and I have written an article on the subject that was recently published in the Energy Law Journal. The Berkeley Law graduates who contributed to the project are Sheena Stoecker, Emily Sangi, and Romany Webb.

The right to self-generate is a natural extension of the common law — property owners can make productive use of their property. States can invoke police power to regulate the use of liberty and property in order to promote health, safety and economic welfare. Consistent with the exercise of that power, there are reasonable restrictions on the use of electric generators as they affect air emissions, water quality, noise, and conflicting land uses. In the case of rooftop solar, regulators often require the use of shut-off devices to protect line workers who are responding to a power outage.

But the right of grid-connected customers to generate their own power remains. Support for this proposition is implicit in the many laws that encourage customer-sited generation through the use of economic incentives, protective easements, or mandates. None of these laws creates a right to self-generate. That right is presumed.

It is important to have that right in mind while considering recent proposals that would discourage or interfere with efforts to self-generate. In California, for instance, regulators are reviewing proposals to impose substantial monthly fees on a customer who self-generates while remaining connected to the grid. They have already imposed a minimum bill requirement on all residential customers – a charge that ensures that rooftop solar customers will pay for utility service, even if they don’t use it.

In Minnesota, there has been an effort to prohibit rooftop solar customers from using their own power by forcing them to sell it into the grid. In many states, there are barriers to the use of third-party solar companies that would install onsite generation and then charge the property owners for the output. In some places, utilities have discussed the imposition of exit fees on customers electing to use their own power, or prohibiting onsite energy storage (usually in the form of batteries) – other limitations that could make it more difficult for some customers to exercise their right to self-generate.

In our article, we suggest that policy advocates may want to encourage regulators and lawmakers to recognize the right to self-generate explicitly, and use potential impacts on that right as a yardstick for assessing the merits of new policy initiatives. Perhaps this is a right that no longer should be implied, but instead, should be saluted.

Crossposted from the environmental law and policy blog Legal Planet.

Comments to “You have the right to generate your own electricity

  1. I went off the grid for a few months two years ago. Definitely makes you reconsider the current state of our society’s power consumption patterns. For anyone looking to go off the grid I recommend checking out
    http://www.quietpowergenerators.com for some background info inverter generator technology. All the best and happy conserving!
    Dave

  2. You know its probably obvious, for those of you who are just talking out the side of your neck about who should pay to use or “self generate” their own electricity? Okay maybe for one this written document or article is only referring to those who lives on “CITY OR STATE” property and don’t have the use of electricity, but instead of those who live on their “OWN LAND” in a open country field with the God given right and free will to self generate their own source of power. Make any sense? It is important to think things through before jumping to unnecessary conclusions.

  3. This approach would be very good for developing countries. I wish people in India also look into this line: have your own electricity generator and sell when you are in excess. This could bring down the cost of oil and gas in the world.

  4. Besides just having the right to generate your own electricity, who is going to stop you if you do? It’s a reciprocal right: your grid operator does not have an obligation to buy from you when you have a surplus and sell it back to you when you have a deficit. You have to compensate your grid operator for their capital costs in the previous operation.

    Just because net metering for free, is popular or feels good does not make it correct. In the words of the great Margaret Thatcher, “Socialism is lots of fun until other people’s money runs out.” I am not sure why the UC Berkeley name needs to be associated with every communist ideal. Would you like a free plane ticket to Havana, Caracas, or Brasilia to see how the revolution is going?

    • With extraordinarily rare exception, every solar home is connected to the grid, was connected prior to installing solar, and will continue to be connected going forward. So they have, do, and will in future compensate the grid operator for capital costs. That capital cost is no greater than homes without solar, and, because they reduce demand during peak times, is arguably lower operational costs to the provider, and, benefits the rest of the grid consumers by reducing the burden to the grid during high demand times. Win-win-win.

      Because this is a public utility, they do have an obligation to sell us power if we want it and can pay for it, and, under the current regs, they do have an obligation to buy the surplus – and why not? The infrastructure is already in place, and (at the risk of beating a dead horse) was in place for most folks before the solar was installed. So the power they buy is gotten without any new or incremental capital cost to them. Seems only fair that the generators should be compensated – would be downright ‘socialistic’ of them to get it for free, no?

      The market dynamics are changing, and they are a regulated entity – I get it. Home batteries, microgrids, and technology TBD will further stress these companies. They have missed the boat on much of this for myriad reasons, some of their own doing, some because of the nature of regulation. But to say that people generating clean power, on site, at significant capital cost to them, should bear disproportionate burden for this is absurd.

      And, at the risk of sounding like a “socialist,” we collectively benefit – in reduced air pollution, reduced peak demand, increased energy independence, jobs in a growing sector, and I’m sure there’s more. Past time to rethink the energy distribution infrastructure.

  5. Yes, rooftop solar on suburban homes is connected to the grid. The homes were connected to the grid before they installed solar, and they remain connected after.

    So why should homes with solar be paying incrementally more than anyone else to connect to the grid? If I improve my insulation and reduce the amount of power I buy from the grid, should I also pay more to be connected? Did somebody guarantee the power companies a certain number of dollars per house? Arguably, solar homes are less of a burden to the grid, so maybe they should pay less to be connected.

    There is an opportunity cost to the power companies, undoubtedly, but there is no incremental ‘real’ cost associated with solar powered homes. I’m not at all sympathetic – if these companies had any vision, or a little more competition, they would have owned the rooftop solar market DECADES ago.

    We should not be de-incentivizing local power generation in order to continue to feed the beast. It is past time to rethink the entire system, encourage more decentralization, and local, clean power generation.

  6. In response to commenters asking whether solar customers should pay for costs they impose on the utility grid: Reasonable charges, yes. Unreasonable charges, no.

    Current debate focuses on the suggestion that solar customers must be imposing some unrecovered cost on everyone else, so they need to be charged something. But this is not well-proven. Rooftop solar provides some benefits to the grid, and those who continue to draw power from the grid impose some costs.

    How should each of these factors be quantified? Do they cancel each other out? Some argue that, when all is considered, rooftop solar provides savings that more than balance costs. Some argue just the opposite. And how should regulators deal with the reality that costs and benefits differ by customer?

    Placing fixed charges or minimum charges on utility bills for solar customers will certainly reduce incentives to install solar, so they must be carefully considered. Our point is that as public policy evolves in this arena, decision makers ought to keep in mind that people have a right to generate their own power — a right that should be restricted only as far as necessary to protect broader public interest. It seems likely that many utility proposals in this regard overreach. Significantly.

  7. This is not possible in Spain because of new goverment laws that have increased taxes in a way that it makes impossible to use solar photovoltaics or any green energy. They are paying tribute to big energy companys in Spain to increase their profits in order to get management jobs after politics in that companys. New ways of corruption.

  8. Even if self generators are net zero users of grid electricity, they do use the network to send and receive their electricity. That way they can turn on the lights when the wind isn’t blowing and the sun has set. Shouldn’t they have to pay for that use of the network? Someone has to.

    And if there is no surtax on self generators that use batteries to be completely independent of the grid then the cost of grid maintenance will fall on the poor who can’t afford to install panels and batteries.

  9. I have heard of options to use magnets and coils which generate electricity for themselves to rotate at high speed and then that rotation being used for electricity generation. Is this possible? I wanted to publish it on my website too.

    John Mathew

  10. i belongs from INDIA and I’m completely agree with Mr. Weissman, we don’t have direct rights to generate electricity, we Indians have very good innovative minds, we can generate the electricity from garbage with different technologies with minimum investment and minimum waste but to create large amount of energy government policies comes as an obstacle, i said obstacle to government policies because, here in india, it takes very long time to get non objection certificates and other related documents. so i am completely agree with this article. i am an entrepreneur, i manufacture phosphating chemicals.

  11. Would you also care to argue for how taxes on gasoline discourage or interfere with an individual’s rights to drive without an undue burden? The utilities are “fighting” these right-to-generate efforts because they ARE connected to the grid.

    If a homeowner wishes to go completely solar then more power to them. If they are trying to become self-sufficient then why would they need to stay connected to the grid? That answer is obvious. The grid provides reliability. The individual producer can take from the grid electricity they need and supply to the grid any over-production.

    But how is all this power being moved? It has to physically travel through conductors, the grid. Why shouldn’t an individual who wishes to remain connected to the grid also be responsible for its maintenance?

  12. This is really an awesome article about generating your own electricity. Basically, I am a big fan of renewal energy which is eco-friendly. I have also installed one unit of Solar Plant on the roof of my house. I love your approach. Thanks.

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