2020 has been defined by large reductions in wholesale power prices across the board, largely due to solar and wind energy playing a bigger role with their low costs of generation.
Consumers have benefitted by lower electricity prices and higher competition. This is to continue into 2021. After 2021 prices may move up again as increased spending is required to adapt the existing grid to taking up more and more renewable energy. This means not only new interconnectors to be built, but also strengthening the grid at the “thin end” of the grid (where more and more small and medium solar systems feed into the grid.
The drop in prices has the downside of greatly reduced feed-in rates for surplus solar energy. Quite often, even now, the grid cannot take all the power in the midday hours that is produced by a myriad of rooftop solar systems. Rates have reduced already, and we anticipate that we will see TOU feed-in rates sometime soon. This means that solar system owners will only be paid if and when there is demand on the grid. It also means different rates at different times of the day.
For example, a retailer could pay 15 cents per kWh for the hours of 7am to 10am, nothing until 3pm, then 10 cents for 3pm to 5pm, then 20 cents for the time 5pm until the sun goes down.
The logical consequence is this: Solar system owners with east and west-facing solar panels will benefit mostly, particularly those with unshaded west-facing solar panels. The old advice of facing solar panels north is no longer true.