Edison Meter Policy Zaps Solar Users

Doug Nason is the kind of person who tries to live by the principles that get only lip service from the rest of us.

Take green power. In 1999, when California opened its electricity markets to competition, Nason dropped Southern California Edison as the electrical provider at his Mission Viejo home and signed up with a brand now known as electric-

America, which generated electricity from renewable hydro and geothermal sources. In 2001, he added a $22,800 solar power system at the house, taking advantage of a state-sponsored rebate of $10,700.

For a few years, the combination of solar generation and green backup worked perfectly. During daylight hours, when his rooftop unit produced more energy than his house consumed and fed the excess to the power grid, his electric meter actually spun backward.

The arrangement, called net metering, produced cash credits so that his first monthly bill after installing the system came to just $9, a saving of more than 85%.

“For us, it was a matter of conscience to try to do the right thing,” Nason, 39, a teacher and multimedia artist, told me. “It was nice to know the solar would eventually pay for itself, but that wasn’t the reason we did it.” Contributing to the ecological future by using renewable energy was the main thing. “It was about our kids,” he says.

Then, as Nason sees it, Edison struck back.

Last July, the utility informed him that if he wanted to keep his solar unit and the benefits of net metering, he had either to install a new meter at his home (at a cost of more than $500), or dump electricAmerica and re-enroll as an Edison customer, in which case there would be no need for the new hardware. Unwilling to shell out the additional cash, he returned, reluctantly, to Edison.

On first hearing Nason’s story, I figured Edison might have had some legitimate reason for requiring a new meter from the handful of people in his position -- that is, clients of alternative generating companies who also have home generating systems.

After all, he still paid a monthly delivery fee to Edison for the use of its electric lines, in addition to the kilowattage fee he paid to electricAmerica. Maybe Edison needed a special meter to help keep the various charges straight, or maybe the Public Utilities Commission mandated something of the sort.

As it turns out, the situation has nothing to do with the PUC, and everything to do with Edison policy.

Because the Edison International unit chooses to base its delivery fee for customers like Nason on their total consumption of power -- whether generated from the rooftop or from an electric plant -- it needs the information produced by a specialized home meter. (The utility bases the delivery fee for its own solar customers only on their net consumption of its power.)

Akbar Jazayeri, Edison’s director of revenues and tariffs, acknowledges that Edison isn’t obligated to calculate the fee that way -- it’s free to propose any formula, including a rule-of-thumb estimate. He says, however, that Edison prefers to use hard numbers because customers tend to mistrust charges based on estimates.

For its part, the PUC says that Edison isn’t bound to select a billing procedure that places such heavy upfront costs on a rival’s customers.

A PUC staff member did tell me, however, that the utility appears to be entirely within its rights to impose almost any requirement it wishes on so-called direct-access customers -- those buying their electricity from other producers -- within its service territory.

Meanwhile, electricAmerica’s lawyers have reached the same conclusion -- though they’re not nearly so blase about it.

“There’s very little limit to what they can do to those customers,” says Peter Weigand, president of Costa Mesa-based Commerce Energy Group Inc., electricAmerica’s parent. “This is yet one more attempt by Edison to kill off competition, by picking on customers who want to be more than green.”

Jazayeri disputes that Edison developed its formula for competitive reasons. “It’s just our interpretation of how the law should be implemented,” he says.

Weigand, whose company is licensed as a non-utility power provider in seven states, says it serves about 40,000 customers in California, of whom 25,000 are in Edison territory. Only about 12 of them were residential ratepayers with home units like Nason’s, he says, but after Edison put the screws to this hardy bunch, electricAmerica lost them all.

Although Nason’s situation may be unusual, it does speak volumes about what’s left of California’s experiment with electricity deregulation and its commitment to green power.

Just recently, Gov. Arnold Schwarzenegger signed a bill to promote the installation of solar systems in as many as 12,000 homes. In light of Edison’s practice, those installations would tie their owners more tightly to their local electrical utilities -- an outcome that undermines what the governor claims to be his preference for greater consumer choice.

Indeed, the choice made by Nason has become, like the big redwoods, a relic of California’s past. Since the state suspended direct access during the power crisis of late 2001, independent generators have been barred from signing up any new customers.

The original residential direct-access pioneers are dying out as inexorably as survivors of the Andrea Doria or people who get their news from Dan Rather. The prospect of loosening the utilities’ grip on California customers, which was once the state’s formal policy, ebbs by the day.

Nason, for one, certainly doesn’t feel as though the system served him very well. Of Edison he says: “It seemed like they weren’t playing fair. They made it so difficult for me to follow my moral convictions, and for what? So they could keep me as a customer? It doesn’t make sense.”

Golden State appears every Monday and Thursday. You can reach Michael Hiltzik at golden.state@latimes.com and read his previous columns at latimes.com/hiltzik.