Have you ever heard of “net metering”?

It means that if your electric company gives you net metering, you can connect a generator or solar panels to your house and sell excess electricity back to the utility at the same price that they bill you for.

Sounds great right?

No, actually its a major problem for the utility.

The reason is that power plants take a significant amount of time to throttle up or down. If everyone in the area has solar power feeding back into the power grid, sudden changes in sunlight can cause major fluctuations and destabilize the power grid.

So what is the solution?

Dynamic pricing. Some areas already do this. How it works is that the price you pay (or receive) for electricity depends on the conditions on the power grid at the moment, updating as fast as possible.

When the grid has a deficit of power at the moment (maybe a power plant is struggling to throttle up to meet demand) the price goes way up.

If the grid has a surplus power at the moment, the price goes down, even going negative.(meaning you must pay to dump your power into the grid, or be paid for consuming excess power)

What this does is create an economic incentive for people to invest in equipment that actually stabilizes and supports the power grid.

For example if you have an electric car charging in your garage, it knows the price of power, and it can start charging faster when the price drops, or it can dump its battery power back into the grid when the price is high. The battery in your car is actually earning money as it sits idle!

Same with solar panels. Even if the installation doesn’t have batteries, the system can choose to stop selling power to the grid when it isn’t wanted.

Likewise, your heated pool can choose to absorb electricity when the price is low.

This is the future of the renewable energy economy in my opinion.