In California, there has been some argument over the use of battery storage with solar power systems between customers and several California utilities.

Edison International (EIX), PG&E Corp. and Sempra Energy (SRE) said they’re putting up hurdles to some battery backups wired to solar panels because they can’t be certain the power flowing back to the grid from the units is actually clean energy.

The dispute threatens the state’s $2 billion rooftop solar industry and indicates the depth of utilities’ concerns about consumers producing their own power. People with rooftop panels are already buying less electricity, and adding batteries takes them closer to the day they won’t need to buy from the local grid at all, said Ben Peters, a government affairs analyst at Mainstream Energy Corp. , which installs solar systems.

There has been a recent increase in the number of solar power systems with battery storage as the price of storage falls, though the systems are still expensive. After installation of these systems, however, the utility has the last say in whether it can be connected to the grid, and in turn, to the house.

Matthew Sperling, a Santa Barbara , California, resident, installed eight panels and eight batteries at his home in April.

“We wanted to have an alternative in case of a blackout to keep the refrigerator running,” he said in an interview. Southern California  Edison rejected his application to link the system to the grid even though city inspectors said “it was one of the nicest they’d ever seen,” he said.

“We’ve installed a $30,000 system and we can’t use it,” Sperling said.

Utilities say the storage systems open the possibility of fraud. The issue is whether all the electricity being sold through the net metering program is generated only by renewable sources, as required. Consumers in theory can fill the batteries with power from the grid and then send it back designated as renewable energy. With the solar-battery systems, there’s no way to determine the source of the energy. Solar suppliers say that’s not happening.

The issue in these cases is that utilities cannot verify where the battery-stored power is coming from when it returns to the grid, meaning that if they accept power that has been stored, it may be from non-renewable sources, and does not comply with the state’s mandate for more renewable energy to be used on-grid.

The solution to the problem is to add cost to the already expensive solar power systems, installing an extra meter to record whether the stored energy is from the solar system or the grid, since the utilities have been been able to keep up with the changes in the solar power and battery storage industry.

No matter how you look at it, though, this will continue to be a problem until the utilities catch up with the technology.

To read more, visit Bloomberg.com.

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