Solar Energy Companies Rip Off California Customers

Dec 16, 2024

Because power companies increasingly oversupply solar power in California, they are hitting residents with higher electricity bills. They are effectively paying these companies over a billion dollars per year to generate this excess energy, although they are not using it.

The State of California has long-term contracts with solar farms and other renewable energy producers that guarantee their income and profits. California set these contracts under a 2018 bill “incentivizing” companies to build these solar farms. Taxpayers indirectly and consumers directly pay for these “investments” and sale of their energy. At the same time, these government contracts incentivized solar energy producers to increase their power production instead of cutting it. Because, whether needed or not, more energy entails more profits for these companies. That is, the state colludes with these schemers to rip us off.

California could transmit this excess power to other states. But, because other states may not need it, California often has to pay them to take it.

Seeing a killer opportunity, electricity traders got into this scheme by buying this excess energy at meager prices from California and then selling it at higher prices to consumers in other states. Giant banks like Citigroup and hedge funds like Citadel, which have nothing to do with electricity generation, but are in the market to make more money out of thin air, are in this very profitable trade.

As a result of such and similarly creative scheming, California’s electric rates are currently twice the U.S. average, with only Hawaii having higher rates, as the Los Angeles Times reports. Rates at two power companies, Southern California Edison and Pacific Gas & Electric, increased by 51% over the last three years.

These companies sell us solar energy, marketing it as green and reducing pollution. Currently, it only inflates our bills and steals our taxes.