Solar Hot Water – Continued – July 21, 2007

The Solar Cost of Electricity in California:
The Solar Penalty Zones
During the halcyon days of the California energy crisis, the California utility companies adopted a complex tiered electric rate structure to help them take advantage of our California Consummers. While climate ‘baseline’ quantities vary in California from region to region, California electric is divided into approximately16 different ‘baseline’ climate electric zones, the baseline range for residential customers in the PG&E service area is between 300-350 kWh per month, which is approximately 60% of the average monthly use in the San Francisco Bay Area, California . The baseline rate is the lowest available rate for residential customers of electricity. In the region served by PG&E, the residential baseline rate is approximately 12.5 cents per kWh in 2004 and the residential customers who exceed their baseline quantities face steep penalty rates for the excess electricity. The table below shows the rate structure:

California Tier 1 electric usage up to the baseline amount is 12.5cents/kilowatthour

California Tier 2 Electric Usage excess from 101% to 130% is 14.3cent/ kilowatthour

California Tier 3 Electric Usage excess from 131% to 200% is 17.9cent/ kilowatthour

California Tier 4 Electric Usage excess from 201% to 300% is 21.0cent/ kilowatthour

California Tier 5 Electric excess Use exceeding 300% is 21.0cent/ kilowatthour

Solar Rate of Inflation in California: The Really Big Savings in solar.
The biggest savings from installing a solar electric power system will be realized in future years. The calculations have been done based upon rate data from the California Public Utility Commission and it shows that the average electric rates have increased from approximately 2 cents per kilowatt hour in 1970 to approximately 15 cents per kilowatt hour in 200 and that is an average rate of increase of 6% per year.  There is no doubt that a solar electric power system installed in 2007 is going to be a bargain when compared to prices reached in 2012.

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