Once you go solar, billing with your designated utility changes. Most of our customers are also utility customers of PG&E, one of the three major utility companies in California. A good solar installation company will walk you through what to expect with your bills when you go solar and introduce what is known as a True-Up bill. However, we recently have been receiving an upswing in complaints regarding True-Up bills from customers that choose to go solar with another local company. This blog will discuss what a True-Up bill is, what surprises might be there and why, and what you can do to remediate any problems. We will also touch lightly on how to choose a reputable solar company that will help reduce the chances of any sort of solar True Up Terror story.
What is a True-Up Bill
A true-up bill is an annual billing statement that you will receive from your utility provider, such as PG&E. Although you will receive a monthly statement from PG&E, there will be an end-of-year statement that is known as a True-up bill. Your monthly statements will outline total energy production and energy consumption of the household. It will also specify how much energy was purchased from the energy grid and the credits any over-production from your panels awarded your account. The monthly bill will also charge the household for any carrier fees and gas fees that must be paid monthly.
The True-Up statement will be similar, but a bit more in-depth. The True-Up will have a final, concrete calculation that outlines each month’s total solar production, and how much of that energy was consumed by the household and how much was fed back into the grid. Additionally, the amount of electricity that was purchased from the utility will also be stated, per month – and what the annual total cost of purchased electricity was. Also, any annual utility fees and other mandatory fees will be charged out for the annual billing cycle.
What Surprises Can I Plan For?
There are a few surprises we have found customers confronted that were unprepared for. First, a large True-Up bill. What this means, as we think we own the energy we produce, often there is a notable True-Up bill at year end, meaning we used much more electricity than we produced.
A second surprise that customers find is that the rate they purchase electricity from the utility is much higher than the rate the utility gives them for the electricity they sell back to the utility. In an ideal world, the cost of sale and purchase is 1 to 1. However, in reality, the rate is higher than solar homeowners were expecting.
Why Do I have a True-Up Balance Due?
A True-Up balance can occur for several reasons, many of which can be avoided, or at least budgeted for.
First, there are annual costs associated with being connected to the energy grid. These costs and associated fees are not bypassable and will be a cost that appears on a True-Up bill.
Second, the residential solar installation was not built to offset the homeowner’s energy usage 100%. There are several reasons for this. One is that a rooftop may not be ideal for solar panel installation. Steep inclines, chimneys, vents, and skylights are a few of the problems solar installers and designers find. If there are obstacles on the roof, panels cannot be installed safely. Or, panels are placed in areas that have now efficiency rates, meaning they are not producing at capacity. Another reason is unscrupulous salespeople who will undersell a system to knock down the sticker price of the system to lure in timid buyers. The problem with that is buyers will think they have a full system when in reality the system is only built to offset a small percentage of total energy use, which could result in a very high True-Up bill.
Third, some consumers either consciously, or unconsciously, increase their electricity usage once they go solar. As systems are built off a baseline energy unit, assuming it was built to offset usage by 100%, an increase in electricity usage could result in a True-Up bill. Increases in electricity consumption could be caused by additional family members moving in or keeping the home at a cooler temperature while running the A.C.
Finally, if a homeowner has a system built without a good baseline energy usage, there is a chance that the system will not be designed to offset the actual energy usage of a home. Having a solid 12-months of energy usage will give your solar installation company enough information to truly design a system that answers to a home’s energy usage. Less than 12 months leaves the homeowner open to risking a large True-Up bill due to inaccuracy in system design.
What Can I Do to Reduce My True-Up?
First, to reduce your True-Up bill, ensure your system was built to offset your entire energy usage within the home. Second, be more mindful of how energy is being used. If the system was built to offset a specific amount of electricity usage, ensure you are not using more energy than the system was designed to produce.
To avoid the risk of a large True-Up, waiting until you have enough energy baseline data will also allow your solar installation company to design and install a system that reflects your energy consumption.
At the point of sale, if you think your energy usage will increase, ask your solar installation company to slightly oversize your system. This oversizing will increase the cost of your solar system, but it will also create a buffer between your solar installation and increased energy consumption.
Ask Your Solar Installer
Being proactive at the point of the solar design is important. Be sure you are active in the sales process by asking important questions. Be sure to confirm the company is a fully insured, licensed and bonded construction company. Also, confirm that there is a designated solar design professional who creates your system. Ask how they pull usage to determine the size of the solar installation and confirm that the solar system size covers your usage fully. If it does not, ask why. Also, be sure to ask your installer to explain the solar True Up bill and walk you through the sample, so you can learn what to expect.
If you still have questions, take the time to stop by our Solar Showroom in downtown Brentwood or reach out to one of our Energy Advisers.
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