As the rise in popularity of solar arrays has hit “mainstream” status, it seems as though some utility companies are starting to take heed of a growing trend in the energy market: their customers are leaving in droves.
For years, solar has been considered a “niche” market, where only a handful of people would have a need for generating their own power on site. This was buffered by the fact that solar installations typically required hefty government subsidies in order to be economically viable to everyday people, and therefore it was casually assumed that solar power would never take off and become a widespread phenomenon. However, years of continually rising energy costs, coupled with a successful green movement has devastated these assumption, and now, it’s got large utility companies worried.
You see, solar power has gotten so cheap to install that the government subsidies have all dried up. They’re no longer needed. On top of that, the per-kilowatt cost to install a solar array has dropped so much that it’s now cheaper than conventional power, such as coal and natural gas. In fact, oil, coal, and natural gas are all subsidized by the government far more than wind, solar, or geothermal alternatives. It’s the economics of the situation: the free market has spoken and renewable energy is in high demand.
As a result, power companies are losing money as more and more of their customers cut their dependency on traditional power and start providing a surplus back to the grid. Some companies are desperately trying to bolster their falling revenue by coming up with “creative” fees and additional charges to renewable customers, however that too is having a negative effect. As one solar customer put it:
“Well, I put in solar, and now the utility wants to hit me with a fixed charge. I guess I’ll just put in [battery] storage with solar and get off the grid altogether.”
The problem is that utility companies have been operating for nearly a century under the premise that customers need their business in order to live day-to-day. While this was true before, technology has advanced enough to allow the customers alternative options, and now utility companies have no tools with which to combat consumer distrust and abandonment. This phenomenon of fleeing customers has been loosely named the “death spiral,” as it mimics the same logistical movement that something would circling a drain.