Fixed Costs & Energy Credits: What you need to know.
Considering solar energy for your home? Before you make that investment, it's important to know how solar energy works - from the purchasing process to its effect on your energy bills. Let us help you. If your primary goal is to save money, we can help ensure you're purchasing solar that's right for your budget and energy needs. Here's what you need to know about residential solar installations.
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Be sure to calculate the return on investment before you buy. Before purchasing a solar system, contact WFEC for assistance calculating potential savings. Solar contractors often use regional or national electric rates when calculating potential savings, but our energy experts can provide you with WFEC's solar rate information to help you make an informed decision. WFEC offers an energy credit of 5.2 cents per kilowatt-hour for solar installations smaller than 25 kW when purchasing energy that members generate. Consider intermittency and infrastructure. Solar energy can only be generated when weather conditions permit. At night and on cloudy days, solar panels cannot produce electricity. Solar panels are also not reliable during peak periods (such as cold winter mornings before the sun comes up) when most people require the greatest amount of power. Members who generate only a portion of their own energy needs with solar panels will still need to purchase energy from WFEC. Because of the limitations of solar, WFEC must rely on other generating sources, such as natural gas, coal, nuclear and hydro, to meet energy demands 24/7/365 regardless of whether a member with solar or any other type of member-owned generation system uses it. WFEC members who have solar interconnections are charged $4.94 per kW of their overall system capacity. This is a pass-through charge from PowerSouth, the cooperative's wholesale power provider, to the member for costs associated with having generation capacity available for the member regardless of use. This fixed cost charge was filed with the Florida Public Service Commission.
Understanding WFEC's base charge (fixed costs)
Because each member has access to the infrastructure delivering electricity (poles, wires, meters, transformers, etc.) and must rely on it, at least some of the time, each member must pay their fair share of these "fixed costs." Members cover part of this cost through a basic service charge of $35 per month. This fee is required from all residential members who receive service from WFEC, whether or not they purchase energy.
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It's similar to owning a car. Your fixed costs - monthly payment and insurance - are the same each month, no matter how much you drive the car. Your variable costs - gas and maintenance - vary based on usage. Power bills work the same way. The fixed costs are mostly recovered through the basic service charge, and your variable costs change depending on how much electricity used each month. The process of setting up solar panels and connecting to the electric grid requires certain metering equipment to be installed. Interested parties must complete WFEC's interconnection agreement and application, submitting a $135 application fee. Our staff can assist you with the process.
