By Dan Bihn

Net metering was a great start. It helped launch the solar electric industry. Net Zero Energy is even better. It brings together onsite renewable power generation and energy efficiency. But neither one will help solve the next challenge our energy system faces — affordably accommodating large amounts of solar and wind energy.

To do that we’re going to have to get smart.

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Typical U.S. Net Metering Setup

Back in the day, net metering of rooftop solar was a great idea. In the early 1980’s, when net metering laws started showing up, solar panels were expensive. Selling energy back to the grid at full retail rates seemed like an appropriate reward for early adopters whose investment was often paid off more by environmental goodwill, than financial returns. The logic was sound and the results have been delightful.

And net metering was easy. Fortuitously — but unintentionally — most legacy power meters spun backwards when power flowed back on the grid. So the meter did all the math in its little mechanical brain and the meter reader’s job didn’t change. Only the billing software needed to be upgraded a bit.

If your solar system is designed to produce as much as you consume over an entire year, you have a net-zero system. And you can say you make all of your own electricity. But that means you’re using the grid as your battery — charging it when the sun shines, then discharging it when you need electricity.

And the grid is not just a dinky little day-to-day PowerWall sort of battery. It is a full-on seasonal battery that you can charge in the summer and discharge in the winter. It’s like having your own personal pumped hydro system.

But that battery is running out of capacity.

In 2019, the world is different and the days of using the grid as our personal battery for our rooftop solar energy are coming to an end.

Today, our sunny neighbor to the south routinely puts close to 18 gigawatts of solar energy onto the grid. More than a third of that comes from net metered rooftops. On mild, sunny California weekends, low demand and high solar production combine to exceed the grid’s ability to accommodate all of that carbon-free energy.

When that happens, California’s grid operator (CAISO) is forced to temporarily stop large solar farms from producing energy from their expansive arrays. Electrons excited by sunlight are left to bounce around inside the solar cells, meaninglessly heating the panels.

In 2018, more than 1.5% of California’s solar energy that could have gone to market was left unharvested, rotting on the photovoltaic vine due to lack of demand. (That number is about half what it was in 2017, in part due to the Energy Imbalance Market.) Naturally, when the large solar farms are producing electricity, so are regional rooftop solar systems. On those hours, essentially every kilowatt exported from net metered roofs directly leads to an equal forced output reduction from those large solar farms. No net benefit.

Can we do better?

Net Zero Energy Homes and Buildings

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2002 National Renewable Energy Lab (NREL) net zero energy home

Many people think the next steps towards a low carbon future are net zero energy homes and buildings (often abbreviated ZEH and ZEB, where the N in ‘net’ is not only silent, but invisible). While these programs can be a great way to achieve our individual decarbonization goals, they could be making it harder for the whole system to do the same.

Program details matter. Here’s one example that might offer some insights.

Let’s go to Japan and see what they’re doing…

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Japanese Net Metering

Japan, reeling after the earthquake, tsunami, and nuclear meltdowns of 2011, amped up it’s renewable energy game. Japan has never had simple net metering. They’ve always required 2 meters — one for purchased inbound power and a separate meter for outbound excess power. While this may sound a bit cumbersome, it offers some interesting opportunities.

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Separate meters for buying and selling electricity

Having two meters allows for asymmetric ‘net metering’ — purchased electricity can be priced differently than exported electricity. And that’s exactly what Japan has been doing. In 2012, largely due to the unpopularity of nuclear power, the excess energy selling price was set to $0.41/kWh, while the retail purchase rate was hovering around $0.27/kWh.

That policy — and a companion commercial feed-in tariff — have proven very popular and effective. Japan went from less than 1% solar in 2010 to well over 6% solar in 2018.

However, in some parts of Japan this policy has been a bit too effective. Much like California, some regional utilities have had to curtail PV output on mild, sunny weekends when low demand and high solar production exceed the grid’s ability to accommodate all of that solar energy.

The economics are changing. As solar costs have declined, so too have the tariffs. Today export rates are close to the retail purchase rate (making it equivalent to simple net metering), and they are heading down further, to a bit below retail this coming year.

Japan’s ZEH

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Advertisement for one of Japan’s net zero energy home builders

The 2011 tragedies also accelerated Japan’s nascent zero energy home program. Today a $7,500 ZEH subsidy is waiting for those who play by some very forward-thinking rules.

Naturally the home must annually produce as much as it annually consumes. It also must exceed existing energy efficient building codes. And the home must use state-of-the-art heat pumps and appliances.

But what sets this program clearly in the 21st century is the requirement for a sophisticated home energy management system (HEMS). These systems, which look like a wi-fi router, use a recently standardized home network protocol to control just about everything from lights, heating, and cooling, to home security and fancy bathtubs. And the HEMS must communicate with the smart meter and the PV inverter.

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Typical installation of a Japanese Home Energy Management System (HEMS)

As solar penetration increases and the buy-back price of rooftop solar decreases, the smart ZEH homes are ready!

Back when export rates exceeded retail purchase rates, the smart homes benefited their home owner by shifting consumption away from times when the solar panels were producing, so they could cash in on the generous export rate.

As export rates drop below retail rates, it is in the home owner’s best interest to shift their consumption to times when solar panels are producing to avoid buying more expensive grid power (effectively a self-consumption tariff).

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Wall-mounted HEMS user interface

But it takes more than a smart HEMS system to do this.

It takes flexible loads. While shifting lighting from nighttime to the middle of the day may not be a very bright idea, what about loading your clothes dryer in the morning and have it wait until there’s enough rooftop energy to run? Or, if you have an electric vehicle (and it’s at home), charge it when the sun shines.

But maybe the best idea is cranking your heat-pump water heater when the sun is shining. As it turns out, Japan is ready for this!

Japan had already pioneered the ideal water heater — the EcoCute (the word “cute” sounds likes the Japanese word for water heater). It is a high performance heat pump that uses CO2 as the refrigerant, allowing it to operate at higher temperatures. And if it leaks it won’t lead to the ozone-depleting problems of conventional refrigerants. On top of that, since the CO2 was initially captured from the air, leaks won’t increase atmospheric greenhouse gas levels.

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EcoCute heat pump hot water heater (penguin optional)

In an ironic coincidence, it was designed to help Japan increase its nuclear fleet by creating new electricity demand in the middle of the night when predicted nuclear oversupply would be their chief grid integration challenge.

An EcoCute needed to heat a full days worth of hot water and it needed to stay hot well into the evening for the customary very hot bath. And the heat pump needed to be ‘oversized’ so it could do all that heating in the 5 hours between 1AM and 6AM, when there was to be an excess of electricity. (Perhaps this sizing strategy is not the most energy efficient using a very narrow definition of efficiency, but it would have been the most beneficial at the system level. That difference is worth thinking about.)

So far, relatively few people have invested in ZEH homes, but almost everyone has heard of them thanks to all the ads and commercials by the vendors like Panasonic, Toshiba, and Mitsubishi.

The plan calls for all new homes to be ZEH by 2030. Time will tell.

Back Home

Whether the solar energy comes from your home’s roof, your community solar project, or a sunnier place a bit further away, a smarter home can make using that energy easier and cheaper for all of us.

When there’s an abundance of solar or wind energy on the grid, our homes can figure out how to meaningfully use it — starting with efficiently making hot water or charging our electric vehicles. Not only is that much better than letting carbon-free energy go to waste, but it should be cheaper, too.

And it doesn’t need to be as random and reactive as you might think. Day-ahead forecasts of wind and solar continue to improve, so our homes can do more sophisticated scheduling. Your dishes can be washed and ready by the time you come home. Maybe even your frozen ice cream will be at the perfect scoopability at 7PM in spite of it being solid as granite at 2PM (who said thermal energy storage can’t taste good?).

The results? More solar and wind can be put on the grid without immediately investing in expensive batteries and transmission lines.

Our solution will be different from Japan’s. It will need to be built with the tools we will have here — flexible devices like smart thermostats, electric vehicle chargers, and smart water heaters all controlled by smart home systems like Alexa, Apple’s HomeKit, and the Google Home Hub.

Oregon, especially Portland, is well positioned to be the national leader in Smart Zero Energy Homes and Buildings. We have a population that actively cares about carbon, the environment, and energy. And the region is full of thought leaders, utility and government program managers, and solar installers ready to meet the challenge.

The next phase of the revolution can begin right here. Are you ready?

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Japan’s vision for smart zero energy homes

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