[Dylan16807]

> So by supplying the kWh locally to neighbors, the grid costs have been avoided.

No they haven't. The grid cost is to build and maintain the wires and equipment. Your solar output isn't reliable enough for them to downsize the grid, so even though selling to a neighbor bypasses the grid it doesn't reduce the cost of having a grid.

What you could do is split out the grid cost, make it be a fixed fee per location instead of per-kWh. That would drop the price of buying a kWh until it's much closer to the price of selling.

But if you do that, someone with a lot of solar panels would end up with even less money in their pocket, since their reduced kWh purchases used to let them skimp on grid fees, and now that no longer happens.

[epistasis]

If you keep reading to the next few sentences I point out that the utility has sunk costs, so I understand you point quite well already.

Transmission savings are the big thing with distributed solar and storage. And transmission is the bottleneck for most projects looking to connect to the grid right now. Not only is it expensive, it's slow to build.

[Dylan16807]

> If you keep reading to the next few sentences I point out that the utility has sunk costs, so I understand you point quite well already.

It's not that they have sunk costs, it's that they have ongoing costs. The grid cost does not drop when you send excess solar to a neighbor. To actually avoid grid costs you need to reduce your max watts in a way that the power company can rely on.

> Transmission savings are the big thing with distributed solar and storage. And transmission is the bottleneck for most projects looking to connect to the grid right now. Not only is it expensive, it's slow to build.

Storage can save on transmissions but it has to be set up the right way. Solar and storage working together can do even better, but also have to be set up the right way. Solar by itself doesn't make a big difference in peak transmissions.