According to the conventional wisdom, if you install solar panels on your roof you can zero out your electric bill and save pot loads of money. This is actually true if you live in certain states, particularly California. The catch is that everyone that does not have solar panels on their roof is paying for your benefits. For the homeowner that’s a not a problem. It’s a feature.
Solar only works during the day and best in the middle of the day. But residential electricity consumption tends to peak in the evening. A scheme called net metering fixes this problem by allowing the homeowner to “bank” excess midday electricity and then withdraw it from the bank later in the day. The bank is imaginary, an accounting fiction, because it is not easy to store electricity. The bank can even be used to store summer electricity for consumption in the winter, when solar works poorly. The excess solar electricity is fed back to the grid where it is immediately consumed by other customers. There is no bank except in the accounting books.
Residential solar is a disaster for the electric utility. Once the customer installs solar, the utility loses almost all its revenue but keeps nearly all its expenses. The expenses are maintaining a connection to the customer’s house including the distribution system that carries electricity from the generating plants to the customer. The generating plants still have to be ready to provide regular quantities of electricity to each solar homeowner as soon as the sun sets and whenever it is cloudy.
(Excerpt) Read more at: