Solar power in NZ and “net billing”

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#2889921 22-Mar-2022 10:46

MikeAqua:

I've always thought that retailers should all have to buy customer generated power at the spot price. Reflects the reality of how much the power is needed at that point in time.

Not sure if it's technologically possible, but people with storage could set a threshold price above which they will sell stored energy back to the network.

Pretty sure it's doable, I believe I've seen discussions with other people doing exactly that and pushing out a few kWh of power when they see the price get into the 30-50c a kwh range.

Certainly it seems flick tries to encourage that behavior.

insane

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#2889938 22-Mar-2022 11:31

ANglEAUT:

tchart: ... In BC Canada they have “net billing” which means power retailers have buy back excess power from solar at the same rate they charge. ...

In NZ, it has never been "same rate they charge", it's always been lower, but some do buy your excess generation.

From Harrisons: Get paid 16c per unit for your extra solar generation. Install your solar with Harrisons and switch your power to Trustpower on a 24 month term, Trustpower will buy back your extra solar generation at 16c per unit (excluding gst). Maximum of 500 units per month and is guaranteed for the life of the 24 month contract.

16c/kwh for 24months is hardly something worth banking on when the break even period is likely to be ~10 years or more. Also without taking into account their daily and standard rates its's really only part of the overall cost so I'm not convinced it's such a great deal overall. You'd be better off shopping around, or investing in battery storage and using the power at peak times rather than trying to make a PV system financially viable through generation credits IMO.

eonsim

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#2890269 22-Mar-2022 18:26

insane:

...

16c/kwh for 24months is hardly something worth banking on when the break even period is likely to be ~10 years or more. Also without taking into account their daily and standard rates its's really only part of the overall cost so I'm not convinced it's such a great deal overall. You'd be better off shopping around, or investing in battery storage and using the power at peak times rather than trying to make a PV system financially viable through generation credits IMO.

Pretty much, I calculated it out based on the last years usage before going with that deal. The 16c buy rate pretty much balanced out the higher per-unit charges for us compared to say powershop and 8c per unit, there was maybe $50 per annum in it. The combination of that minor benefit plus the fact they will supply an import/export meter and install for free (saves ~$250), meant they came out a few of hundred $ ahead after 2 years (and flickr wasn't taking customers).

Really the biggest reason to go with Trustpower is there solar buddies option if you have a decent sized system. If you have family or friends with Trustpower you can sign up 5 'buddies' and sell them your excess generation at an agreed on price (50kwh ea per month). If you could find 5 buddies and get them to agree to something in the 16-20c range per kwh you'll get a bit of benefit (you could also gift it to them if not interested in the money), plus reducing their power bill a bit, in addition to the 500kwh per month you can sell at 16c to Trustpower.

As soon as the two years is up though we will be moving somewhere else, maybe Flick, or Electric Kiwi if the numbers work out based on our usage and generation, will have a couple of years of power use tracking data at that point to calc the best plan.

kotuku4

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#2890286 22-Mar-2022 18:49

When I had solar installed in 2018 meridian paid 24c, the same as they charged, excluding GST.

tdgeek

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#2890287 22-Mar-2022 18:55

Scott3:

Net metering legislation would force power retailers to buy solar power at a retail rate, rather than the likes of much cheaper hydro / wind / thermal power at wholesale rates.

What is a rough ball park spot rate in the Nov to April period? It would seem fair to retailers to buy solar at the rate they will pay for it anyway.

MadEngineer

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#2890333 22-Mar-2022 21:23

eonsim:

Net metering while nice in principal has issues for solar, around time of use.

The problem is that solar produces the most power during mid-day when power requirements are the lowest, and produces little or no power at peak times. A kwh provided at lunch-time when no one wants it is worth a lot less than one provided at 6-7pm when everyone wants one. Net metering unfortunately unlinks power power generation from demand and when solar generation becomes big enough can cause issues for the power grid.

This point, and more:

The 'duck curve' is solar energy's greatest challenge - YouTube

You're not on Atlantis anymore, Duncan Idaho.

elpenguino

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#2890337 22-Mar-2022 21:49

MadEngineer:

eonsim:

Net metering while nice in principal has issues for solar, around time of use.

The problem is that solar produces the most power during mid-day when power requirements are the lowest, and produces little or no power at peak times. A kwh provided at lunch-time when no one wants it is worth a lot less than one provided at 6-7pm when everyone wants one. Net metering unfortunately unlinks power power generation from demand and when solar generation becomes big enough can cause issues for the power grid.

This point, and more:

The 'duck curve' is solar energy's greatest challenge - YouTube

Yes, although the example given in the video is the USA with lots of thermal and nuclear generation.

Thermal plants take longer to spin up than hydro which can spin up in minutes so NZ should be better placed to avoid overgeneration compared to somewhere like the USA.

On the other hand, no matter how many panels on our roof we'll all want to be warm on a cold August night and we'll expect all power plants to be available. An organisation investing in a power plant now is going to be annoyed if they can't sell their power during day times.

As posited Scott3 in another thread, I suspect that because the supply of electricity is such a strategic asset for NZ, it should be returned to public ownership so that these modern challenges can be met.

Most of the posters in this thread are just like chimpanzees on MDMA, full of feelings of bonhomie, joy, and optimism. Fred99 8/4/21

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surfisup1000

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#2890690 23-Mar-2022 14:27

tchart:

Im not against profit but I do think that NZ "gentailers" are currently milking the consumers.

If you really think this, then buy shares in gentailers.

My genesis shares have dropped from almost $4.00 a share down to $2.85 in just a year or so.

tchart

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#2890708 23-Mar-2022 14:47

surfisup1000:

If you really think this, then buy shares in gentailers.

My genesis shares have dropped from almost $4.00 a share down to $2.85 in just a year or so.

Considering they made $34 million net profit last year, yes. And a 17c dividend means they paid out around $14 million to shareholders (based on 82 million shares). Supposedly 51% shareholder is NZ Govt so a nice $7 million pay out.

k1wi

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#2890806 23-Mar-2022 15:29

If anyone thinks that net metering reduces the profitability of power companies, I’ve got a bridge to sell you.

The cost is simply passed onto solar and non-solar customers in one way or another elsewhere.

surfisup1000

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#2891386 24-Mar-2022 13:33

tchart:

Considering they made $34 million net profit last year, yes. And a 17c dividend means they paid out around $14 million to shareholders (based on 82 million shares). Supposedly 51% shareholder is NZ Govt so a nice $7 million pay out.

Genesis has a market capitalisation of 3 billion or so, and made 34 million net profit.

This is the same as owning a company with a capitalisation of $1000 and making $11.33 net profit. This is hardly excessive profiteering.

And, profits have been dropping 10 million dollars a year recently.

If you really thought they are making excessive profits, it is a no brainer to buy their shares. If genesis were a great deal at $4, then, they are an incredible deal at $2.85.

insane

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#2891392 24-Mar-2022 13:51

surfisup1000:
tchart:

Considering they made $34 million net profit last year, yes. And a 17c dividend means they paid out around $14 million to shareholders (based on 82 million shares). Supposedly 51% shareholder is NZ Govt so a nice $7 million pay out.

Genesis has a market capitalisation of 3 billion or so, and made 34 million net profit.

This is the same as owning a company with a capitalisation of $1000 and making $11.33 net profit. This is hardly excessive profiteering.

And, profits have been dropping 10 million dollars a year recently.

If you really thought they are making excessive profits, it is a no brainer to buy their shares. If genesis were a great deal at $4, then, they are an incredible deal at $2.85.

Don't get too caught up in the profit numbers, they may have invested heavily into various capital works.

The share price needs to be looked at over a much longer period of time. Despite all what's going on they are up a 1/3 on where they were 4 years ago. That alone might not seem like Bitcoin returns but very healthy for the type of company they are.

Their EBITDA was $386million, over 10%. They are hardly doing it rough.

surfisup1000

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#2892041 25-Mar-2022 13:02

insane:

Their EBITDA was $386million, over 10%. They are hardly doing it rough.

I agree ... but, the previous poster had used profit alone to conclude the power companies are ripping off their customers. And, I didn't want to enter into a full financial analysis.

The Genesis EBITDA is not at a level where you could accuse them of profiteering either.

I own a number of Genesis shares, and I'm disappointed in the share price falls .... but labour really give me the heebie-jeebies when they talk about introducing price controls and maybe nationalising the electricity sector.

insane

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#2892095 25-Mar-2022 13:20

surfisup1000:
insane:

Their EBITDA was $386million, over 10%. They are hardly doing it rough.

I agree ... but, the previous poster had used profit alone to conclude the power companies are ripping off their customers. And, I didn't want to enter into a full financial analysis.

The Genesis EBITDA is not at a level where you could accuse them of profiteering either.

I own a number of Genesis shares, and I'm disappointed in the share price falls .... but labour really give me the heebie-jeebies when they talk about introducing price controls and maybe nationalising the electricity sector.

All good, my shares took a beating too, as did KiwiSaver. I suspect the Rio Tinto shenanigans and increased coal burning wouldn't have helped their bottom lines.

Think on the bright side, once those naturalised assets go through a three energies reform it'll be right as rain. #joking!

I used to think that privatisation of them was a bad idea - now im not sure the alternative is any better.

I can imagine more people going fully off grid once much higher panel efficiency becomes the norm and battery storage costs a lot less.

CrazyM

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#2894224 30-Mar-2022 13:22

One thing with discussing net metering is that it depends on what time period you are talking about.

Net metering over an entire day isnt fair because as mentioned you get into issues with power pricing throughout the day (i.e 1kWh in the middle of the day doesn't/shouldn't have the same value as 1kWh at say 6pm (peak demand))

Net metering over a smaller time period (per 30 min, or per min) gets better in this regard.

What I want is instantaneous net power metering over the phases supplied to your house. Most other countries have this. In NZ currently you can be selling solar for 8c on one phase while buying power at 30c on another phase. This is a problem for anyone with a 2 or 3 phase supply to their house and want to maximise their self consumption (and therefore save the most money)

In my case I have solar and a 3 phase inverter. This means if I am producing 3kW of solar from the roof it is being sent into the grid at 1kW per phase (1+1+1=3). Now if the hot water cylinder turns on with its 3kW element instead i am now buying 2kW of power on one phase (3kW load - 1kW from solar), while selling 1kW of solar power on each of the other 2 phases. If there was net metering my cost would be zero (3kW being generated, 3kW being consumed)

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