Archive for March 2014
So it looks like the next big thing has started. Like all really important trends, this one takes a leap of faith to predict where it’s going, but I think it’s realistic and only a matter of time.
Here’s the headline…. “Tesla Plans $5 Billion Battery Factory for Mass-Market Electric Car”. The obvious question is what does that headline have to do with Green Homebuilding? Follow the logic. Solar is on fire. City Ventures has been installing solar as a standard on our all-electric townhomes for years, and now almost all new home builders are heading that direction. A lot of them still have it as an option, or available as a lease, but the reality of Green Homebuilding is that soon, ALL homebuilders will put solar systems on the roofs of homes and make it standard in the way that microwaves are now standard.
The utility companies are starting to feel the pain. In New Mexico, the utility company tried to implement a $50 per month fee to hook into the grid. Fortunately they were shot down and only a $3 per month fee was approved but look deeper and see where this is headed and how the headline weighs in on this topic.
In the old school world, I live in a house that is connected to the “grid”. The grid is basically a bunch of wires that deliver electricity. The wires all start from a power plant where huge amounts of coal are shoveled into a facility to be burned. The burning creates steam that turns a generator. The generator creates electricity that travels over the wires. Home and businesses are connected to these wires and utilize the electricity to power their homes and businesses. That system has worked pretty well for about 100 years.
In the new school world, solar is rewriting the rules. Now I can put a system on the roof that turns sunlight into electricity. In fact the technology, which is improving every day, has made it so I can install enough power to operate an entire home. We still hook up the homes to the grid because during the day when the sun is producing the power, the utility company is “buying” the power my system creates and selling it to daytime users. When I get home after dark and my system is no longer producing power, I utilize the grid for power and the “net” amount is billed to me. I produce during the day and consume during the night and I pay the utility company for the “net” amount. For most City Ventures homeowners, that net amount is almost zero. If my utility company gets away with charging me a fee to just hook into the grid, then the benefit of being solar is almost negated. Even though I’m doing the right thing for Mother Earth, the utility companies are trying to figure out a way to bypass doing the right thing, and are offsetting the savings by gouging me for being a part of the grid.
Any freshman Economics student will tell you that people will figure out a way to overcome that “grid” fee. In fact, over time, they will exit the grid.
Which brings us back to the headline. What prevents people from exiting the grid is getting power when the sun isn’t shining. Batteries can solve that issue. Right now, battery technology isn’t at the point that it’s realistic to have a solar system generate power during the day, store it in batteries, and then utilize that power at night when people are in their homes.
But it’s coming.
My prediction is that what Tesla is going to build will encourage that type of technology and provide it at a scale where new homes will eventually come with batteries attached to their solar systems and the grid will be a thing of the past. Or at a minimum, not something we will be held hostage to. Instead of trying to derail the train of the sustainability, I believe the power companies need to embrace the inevitability of what’s about to happen and figure out a way to be a part of the new school instead of trying to hasten the grid exit by charging an absurd fee to connect to it.
The bottom line is I believe the world is changing faster than the utility companies are comfortable with. It’s only a matter of time before the “grid” system is done. I believe that is clear. Homes and businesses will create the power necessary to “sustain” themselves. They will have the ability to store the power they generate and have access to that power when they need it through batteries. Trying to “fee” their way out of this inevitability is a short sighted strategy that will hasten their demise. I’m not sure what strategy they should embrace but I AM sure that the trend is underway and irreversible.
Until next time