Entrepreneurs who are genuinely interested in creating lasting value should heed the words of Suedeen Kelly of FERC. No amount of brilliant thinking about the wrong problem is going to make a dent; in fact, it leads quickly to disillusionment, which in my opinion is the #1 reason why so many seemingly wonderful projects over the past 20 years have not worked out.

While it's “obvious” that solar is “good”, no responsible party wants to repeat the California energy crisis of the 1990s, which came from not thinking through the incentives of a non-regulated energy marketplace and where the potential risk factors come from: stranded assets, reliance on rare elements, etc.

Entrepreneurs need to truly grok the mission of a utility (i.e., “ensures safe, reliable and efficient utility services at fair and reasonable rates”) and what that means.

Even I used to think it seemed obvious that if you gave as much energy back to the utility as you take then you shouldn't have to pay anything for energy. However, the fallacy in this logic is easy to see if you take it to the logical extreme: if every house and business became net zero energy and nobody was paying anything for electricity because they weren't using any net positive energy from the grid then there would be no money to support all of the grid infrastructure. That infrastructure is expensive to install and maintain.

And if this scenario ever did occur the grid would essentially act as a very large energy storage device. But it may not actually be a storage device, it may just have to dump excess energy generated during peak generation and generate other energy when the various renewable sources aren't covering demand. Or maybe we figure out a way to store that much energy but energy transmission and storage is not 100% efficient so you have to create more then just net zero energy to cover the various losses in the system.

These are all things that have to be paid for if you are tied into the grid and use it to balance your energy demand versus your generation. I don't really like it, I'd like to see solar (and others) become economically persuasive immediately and don't want to reduce the economics. But it is reality and something that has to be understood in order to figure out how to find a solution.

Currently a for profit company can't fully endorse a wholesale and unlimited move to net metering because it has a fiduciary duty to its shareholders to do what is best for them financially and encouraging your revenue to go to zero does not fulfill that duty. Even a not-for-profit entity can't fully endorse a wholesale and unlimited move to net metering because it won't be able to pay for the grid infrastructure that everyone is relying upon.

This all seems needlessly complicated. Why not just buy whatever surplus electricity small-scale producers generate at market prices (that's to smart meters, this is possible) and sell them electricity when needed at market prices, billing/paying them the net balance?

Nitpicking on a detail: “Really simplified, it’s business model is to sell electrons.” They don't sell electrons; they sell the motion of electrons

Simply put, PG&E's cost structure is always increasing. Because it is a monopoly there are no productivity improvements. Don't think so? Look at the costs of distribution alone – it has AWAYS increased annually; just like Moore's law, there is the Utility Law: the cost of utility energy services will always increase.

Couple the increasing cost with declining energy sales from onsite green generation and you've got rising rates leading to a vicious cycle. As rates increase, the economics of onsite generation increase and more people adopt green generation for their homes.

Thus, PG&E's goal is simple: stop this now before the utility crumbles.

PG&E's agrument that non solar participants are subsidizing the cost of participants is bogus because non-participants have an equal opportunity to become participants . What if the goal is to have every home/business to be green? Where does that leave the utility?

You get the picture. The utility is left to serve back up for a small percentage of the current market. PG&E will NEVER, EVER support unbridled adoption of onsite generation unless it owns this market like it does for centralized generation and distribution.