Going Solar in Salt River Project (SRP) Territory in Phoenix, Arizona
Here we will discuss going solar in Salt River Project (SRP) territory in the Phoenix area.
- SRP developed the Residential Distributed Energy Resource Program to assist customers in interconnecting their solar system to the SRP grid.
- SRP reviews and approves all solar systems prior to the solar system being turned on.
- SRP has created a Flow Chart that explains the process of going solar in detail.
SRP’s Solar Export Rates and Net Metering
- When a home with solar produces extra energy that is not used immediately, the extra energy is sent to SRP’s grid, and SRP then sells this energy to their other customers. The way SRP credits the customer that generated the energy depends on the rate plan.
- SRP’s Time-of-Use Export and Electric Vehicle Export plans pay the customer 2.81 cents for every kWh they send to SRP’s grid. This is known as a “buyback rate” or “solar export rate”.
- All the power your solar system generates is not always immediately needed at your home, and much of it is sent to SRP’s grid.
- For example, a home uses 1,500 kWh during a billing period. The solar system generated 1,000 kWh during that same billing period, and 600 kWh is used in the home and the remaining 400 kWh is sent to the grid.
- SRP credits the customer’s bill for 2.81 cents times 400 kWh for $11.24.
- SRP then bills the customer for 900 kWh at the applicable energy charges.
- SRP’s Customer Generation and Average Demand price plans use a concept called Net Metering.
- Instead of SRP crediting the customer’s bill for an amount of money, SRP gives the customer a one-to-one credit of kWh.
- Using the above example, the customer will be credited 400 kWh for sending that same amount to the grid. So, the customer will only buy 500 kWh from SRP instead of 900 kWh because they received one-to-one credits for every kWh they sent to the grid.
- Due to the above information, a customer may immediately choose the Net Metering rates because the customer is required buy less energy from SRP. However, the catch to the Customer Generation and Average Demand price plans is that they include what is known as “demand charges”. This means that customer’s pay for the actual energy they use from SRP, but also pay additional demand charges based upon their “peak demand usage”. We will explain demand charges more below.
System Size in SRP
- Due SRP having relatively low “buyback” rates, having a relatively high grid fee of $32.44, and having demand charge price plans with very low energy rates, Phoenix Solar Panel Systems builds smaller systems in SRP to maximize our customer’s savings potential.
- In SRP, we aim to build solar systems that produce 50% to 70% of the home’s historical energy use over the last 12 months.
- Building a large system in SRP with the Time-of-Use Export and Electric Vehicle Export plans results in the customer sending a large amount of energy to SRP’s grid and being paid relatively little at 2.81 cents per kWh. The extra money the customer would pay for more panels would not create a corresponding increase in savings as SRP pays so little for exported energy. Building a 50% to 70% in SRP on these plans reaches an optimal balance between:
- Providing the home with as much solar electricity as possible during on-peak times to minimize the amount of expensive energy bought from SRP;
- Minimizing the amount of electricity sent to SRP’s grid at a low buyback rate; and
- Minimizing the cost of the solar system.
- Building a large system in SRP with the Customer Generation and Average Demand price plans does not make sense either, because these plans offer very low energy rates ranging from 3.7 cents to 6.22 cents per kWh. Solar systems typically create energy at about 7 cents to 11 cents per kWh. Thus, the aim of solar systems on these plans is not to replace SRP’s power because solar provides cheaper power, but to replace SRP’s power during on-peak times to reduce or eliminate the expensive on-peak demand charges SRP adds to these plans. The goal is for the customer to reduce their on-peak demand as much as possible so that most, or all, of the home’s energy comes from solar power during on-peak times.
- Customers who can keep their on-peak energy usage low on the Customer Generation and Average Demand plans will have more savings when compared to SRP without solar and the Export Solar plans described above.
- As you can see, the amount of savings our solar customers will see in SRP depends on which SRP rate plan they choose and how they use energy after their solar installation. Going solar is a not a license for a family to use as much energy as they want. The family must still be responsible and aware of how SRP bills customers to save the most amount of money possible.
- SRP customers that go solar without following the guidance written here will save little to no money by going solar and may even pay more after going solar.
- Since solar systems in SRP only cover 50% to 70% of the home’s energy usage, homeowners will still be buying 30% to 50% of their electricity from SRP, plus some plans have expensive demand charges. Thus, it is important for homeowners to understand all the details of the four (4) solar rate plans SRP offers, which are discussed on another page of this website.
SRP Solar Rebates
- Home Battery Storage Rebate: Get up to $3,600 ($300 per kWh-DC) from SRP for adding a battery storage system to your home.
- Demand Management Systems Rebate: Get a $250 rebate when you install a demand management system (DMS) as part of your solar installation. A DMS is a piece of equipment that helps homeowners lower their on-peak energy demand. SRP’s Customer Generation and Average Demand solar plans charge extra for the highest “demand” of energy in a 30-minute interval during on-peak hours when your home used the maximum or peak amount of electricity. DMS systems prevent major appliances from running at the same time during on-peak hours, which prevents large demand charges from SRP.
SRP Demand Charges
- SRP’s Residential Demand and Customer Generation price plans have a billing component called a “demand charge” included.
- The demand charge, put simply, means you will get hit with a large charge if you use all your major appliances all at once during any given half hour period of on-peak time. In other words, a demand charge is a penalty cost for using too much power all at once during a 30-minute period of on-peak time.
- For example, the following daily routine will land a family with large demand charges on this plan. All the adults and children are home and from 5:00PM to 6:00PM the following appliances are running all at once: three televisions, three video game consoles, water heater, pool pump, electric oven, electric stove, air conditioning, washer, and dryer. The way to avoid expensive demand charges is to “stagger” the use of major appliances instead of using all the appliances at once as in the example above.
- For example, in the summer you will have your air conditioner running between the on-peak time of 3:00PM to 8:00PM on weekdays. The AC unit uses the most energy of any appliance in the home, so you must be careful with what additional appliances you use with the AC unit. To prevent too much energy use all at once, use your oven at 4:00PM, then fill your dishwasher at 5:00PM (but delay the start time to 8:00PM), then take showers at 6:00PM (or wait until 8:00PM), then run the dryer at 7:00PM, and set the pool pump to start at 8:00PM, and so on. Keep in mind, it will save you the most amount of money to run as many major appliances as possible outside of the weekday hours of 3:00PM to 8:00PM. So, only run major appliances on an as-needed basis during on-peak times.
- Any appliance that can be set on a timer, such as your pool pump and dishwasher, should be set to run during off-peak times.
SRP’s Demand Assurance Program
- SRP has a program called Demand Assurance that we recommend for our customers on SRP’s Residential Demand and Customer Generation price plans. There is no cost for this program or equipment to be installed.
- With this program, your billed demand charge won’t exceed three (3) kilowatts (kW) more than your highest-billed demand over the past 12 billing cycles.
- This means that if your highest billed demand charge for the last 12 months was five (5) kW, and some event in the summer (like a party, for family visiting, or home remodeling) causes a peak demand of 13 kW, you will only be billed for an eight (8) kW instead of 13 kW. Then your new highest billed demand would be eight (8) kW going forward.
- This level of protection will save SRP customers money that have a one-off day of very high energy usage during on-peak times.
SRP Solar Export Rates
If you have any questions about going solar in SRP territory, please feel free to call us at (602) 753-0560.
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