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XXXXXXXXXXX1
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join:2006-01-11
Beverly Hills, CA

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[Green Tech] Solar panels: doing the math...

I've been further researching solar panels and playing with the numbers to see if solar panels would reduce my costs given my data, or if they're simply not worth it. Here's what I have so far:

I pulled a year's worth of data, and found that in a 12-month period, I used 13,905 kWh at a total cost of $2149. That averages to 1159 kWh per month at a cost of $179 per month. And that breaks down to $0.15 per kWh.

So, I used an online calculator (»www.wholesalesolar.com/S ··· tor.html) to use the data to see what I would need for solar to offset my electrical use. I am in zone 5, so I get 4.2 hours of peak sun per day (according to their chart), and using my average kWh usage and using solar to meet 100% of my kWh needs, the calculator sized my solar system requirement at 11,957 watts.

So I then went to another calculator site (»sroeco.com/solar/calcula ··· _i_need/) and plugged the numbers in there. If a $4 per watt system cost is assumed, to meet my needs I would need 48-60 solar panels over 967 sq. ft. at a total cost of $48,360. Then subtract $14,508 for the 30% tax credit, and the total would be $33,852.

At my current yearly cost, it would take almost 16 years of $0 electrical bills to break even (and that negates any interest paid to finance the system). To me, the math doesn't make sense with a payback timeframe so long. Anyone think my numbers are off or can make the case that it's still a good investment?

robbin
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join:2000-09-21
Leander, TX

robbin

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How did you calculate future cost of electricity?
XXXXXXXXXXX1
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XXXXXXXXXXX1

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said by robbin:

How did you calculate future cost of electricity?

I didn't, only used the current cost and assumed no increases (which is unrealistic, I know). My power is currently at $0.16 per kWh, but I don't know how it would move over the payback time of the panels.
XXXXXXXXXXX1

XXXXXXXXXXX1

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Further research seems to imply that system costs are quite different company to company, and it looks like costs have come down a lot over the last 5 or so years. Is the system above realistically priced at $48K minus 30% tax incentives? Or is it less than that for total installation costs?
HarryH3
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join:2005-02-21

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Seems to me that you're creating a system that is far too large for your needs. Even if you could generate the total of your daily average in just 4.2 hours, how would you store it for use during the other 19.8 hours of the day? Utilities are quickly realizing that they need to back away from paying above-market rates for backfeed from solar arrays. So don't count on selling your excess to them and then getting it back free or cheap.

How do the numbers work out if you just install a system that will cover your power needs during daylight hours? Here in Central Texas, I would imagine that just being able to self-power the a/c for most of the day during the summer would shave quite a bit off the ol' power bill, without needing to generate enough kWh's to cover the night as well. But I'd be quite surprised if the savings came to enough to cover the payment on the solar array every month of the year.
XXXXXXXXXXX1
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join:2006-01-11
Beverly Hills, CA

XXXXXXXXXXX1

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said by HarryH3:

Seems to me that you're creating a system that is far too large for your needs. Even if you could generate the total of your daily average in just 4.2 hours, how would you store it for use during the other 19.8 hours of the day? Utilities are quickly realizing that they need to back away from paying above-market rates for backfeed from solar arrays. So don't count on selling your excess to them and then getting it back free or cheap.

I thought the power meter spins backwards when more power is being generated than consumed, thus putting power into the grid and offsetting the power drawn in the overnight hours when no sun is present. That was my understanding of a grid-tied system with no batteries, but please correct me if I am wrong.

How do the numbers work out if you just install a system that will cover your power needs during daylight hours?

Tough to know what is needed just to cover day hours. I could go with a smaller system to help supplement with power consumption, but I'd still be subject to utility prices for a portion of my bill. What might a reasonable, smaller size system be?

robbin
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join:2000-09-21
Leander, TX

robbin

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Meter doesn't spin backwards. You get a special meter that meters in both directions. They don't necessarily buy excess for the same price as they sell it to you. All utilities are different on what they pay and how they do it with credits, etc.
XXXXXXXXXXX1
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Beverly Hills, CA

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said by robbin:

Meter doesn't spin backwards.

I saw in a few YouTube videos that the meter spun backwards once the panels were connected. Must have just been that particular meter type then.

Solar power
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You will need a net metering agreement with your POCO before backfeeding into the grid. Most modern electromechanical meters are interlocked mechanically so they won't run backwards. Most electronic meters without net metering programming enabled record all energy passing through the meter as energy delivered to the consumer. The terms of net metering agreements are getting less favorable with each passing day so it would be wise to check with your POCO before formulating any pay-back estimations. The actual contract terms can have a very major effect on your eventual payback.
XXXXXXXXXXX1
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Beverly Hills, CA

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Jump to 8:40 for the spinning backwards part.

»www.youtube.com/watch?v= ··· rdtIvD3I
HarryH3
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Most utilities won't do a 1-for-1 "swap" on the excess power. You get a different meter when you grid-tie and that meter tracks kWh in and out. You pay more for the "in" than they pay you for the "out". I read at article the other day that said that wholesale generation costs an average of 6 cents per kWh. Utilities will not be standing in line to pay more than that for solar generation at the residential level.

Since a/c isn't a large part of the electric bill in CT, then it becomes harder to work out the numbers for what size works best. Even here in TX, with dual 3.5-ton a/c units, they only add around $125-150 per month to our bill during the hottest summer months.

The largest problem with solar and wind is what to do with the excess. There just isn't much in the way of economically feasible energy storage to save the excess until it's needed. There was recently a thread here about how Hawaii has placed a moratorium on grid-tie systems because their grid can't handle all the extra power being backfed to it.
XXXXXXXXXXX1
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said by HarryH3:

Most utilities won't do a 1-for-1 "swap" on the excess power. You get a different meter when you grid-tie and that meter tracks kWh in and out. You pay more for the "in" than they pay you for the "out". I read at article the other day that said that wholesale generation costs an average of 6 cents per kWh. Utilities will not be standing in line to pay more than that for solar generation at the residential level.

Then that being the case, a system sized that big would not essentially replace my whole-house needs.

What's the sweet spot then? Is there a size that makes sense given my situation? My overnight draw is low, and the only thing that might change that would be if I bought an electric or plug-in hybrid car.

robbin
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join:2000-09-21
Leander, TX

robbin

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First thing you need to research is what your supplier pays for excess solar power.
XXXXXXXXXXX1
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Beverly Hills, CA

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said by robbin:

First thing you need to research is what your supplier pays for excess solar power.

I just read in a few places CL&P will pay $0.055 to the customer for excess solar energy. That may change, but that seems to be the rate for now.

Corehhi
join:2002-01-28
Bluffton, SC

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If you are going to go with solar panels I would go about 50% of your over all needs.

The economics of solar panels is debatable at best.
Zach
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join:2006-11-26
Llano, CA

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Given your calculation of $0.16/kwh for purchased power and your utility only paying $0.055/kwh for your excess power, the payback will come mostly from power you generate that prevents imports from your utility. Without knowing more, I would size the system to cover your Summer baseline load during daylight hours. If TOU options exist in your area that would allow you to receive a higher rate for power you export during peak hours, a larger system may be more cost effective. Especially if you are able to, not only cover most of your on-peak usage, but also export enough during peak hours to cover a good portion of the cost of your off-peak usage. Up here in the northern states, solar is sort of a gamble as to whether or not the payback is reasonable.

Just for the record, I have 36 kw of wind generation capacity and I'm "lucky" enough to live in an area with consistent wind energy. On the local co-op, the rate I'm paid for my exports is $.062/kwh and imports are billed at $.091/kwh. Local generation has reduced my kw demand charges slightly so there is some minor savings there. Before someone has a chance to chime in about the cost of my green energy being partially shouldered by tax payers; I didn't take any tax breaks or write offs. Over the last two years, the turbines averaged a tad over 3800 kwh/month although January 2014 was a new record at 9413 kwh. Annually, the system output covers ~60% of our domestic/farm/business electrical usage. This doesn't include the irrigation meters. As for ROI, if I'm lucky, I may recover the cost before I die. When all was said and done, I had more in this little project than I care to add up so I quit adding when the calculator stopped displaying numbers and just said HOLY $HIT.

LazMan
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join:2003-03-26
Beverly Hills, CA

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That's why there's been a metric shit-ton of solar installed in Ontario the last few years...

The government is paying $0.80/kWh for solar energy; which is about 4x what they sell it for.

They are guaranteeing the rate for long terms, and paybacks are in the 4-8 year range, with an easy ten plus years of profit...

It's insane.
ke4pym
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join:2004-07-24
Charlotte, NC

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said by Solar power :

Most modern electromechanical meters are interlocked mechanically so they won't run backwards.

Heh, the modern spinny meter I had on my house most certainly spun backwards when I fired up my array for the first time.
ke4pym

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said by XXXXXXXXXXX1:

said by HarryH3:

Most utilities won't do a 1-for-1 "swap" on the excess power. You get a different meter when you grid-tie and that meter tracks kWh in and out. You pay more for the "in" than they pay you for the "out". I read at article the other day that said that wholesale generation costs an average of 6 cents per kWh. Utilities will not be standing in line to pay more than that for solar generation at the residential level.

Then that being the case, a system sized that big would not essentially replace my whole-house needs.

What's the sweet spot then? Is there a size that makes sense given my situation? My overnight draw is low, and the only thing that might change that would be if I bought an electric or plug-in hybrid car.

You really need to contact some quality installers in your area to help you go over the specifics. They will come out and do a site survey and provide you with a lot better information than any of us here can.

My utility currently does a 1:1 swap. Though, they're trying to weasel out of their commitment. I don't see how an electron I put on the line is worth any more or less than what they put on the line.

The other argument I hear a lot is "solar producers don't pay their fair share". Which I think is hog wash. How is it any different than simply reducing one's consumption?

But the utilities are terrified of this new disruptive technology. While I will concede that the grid was never designed for this, the utilities are going out of their way to cram the genie back in the bottle (perhaps a little earlier than the RIAA did with Napster).
ke4pym

ke4pym to Zach

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said by Zach:

Before someone has a chance to chime in about the cost of my green energy being partially shouldered by tax payers; I didn't take any tax breaks or write offs.

The one thing the folks making this argument forget is the big utilities are getting much bigger tax breaks than all of us combined.

You should have taken them.

Jack_in_VA
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join:2007-11-26
North, VA

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NM. My comment was off topic to an off topic post.
ke4pym
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Charlotte, NC

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said by Jack_in_VA:

I'm sure you can provide documentation to substantiate that claim. Utilities don't need tax breaks as they pass on real costs to customers and are regulated.

Really? Ok. I'll start at home.

»www.ncpolicywatch.com/20 ··· -energy/

From 2008-2012 Duke's tax rate was -3.3% or nearly $300 million in rebates.

That's quite a bit more than I'm getting back.
XXXXXXXXXXX1
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said by ke4pym:

You really need to contact some quality installers in your area to help you go over the specifics. They will come out and do a site survey and provide you with a lot better information than any of us here can.

Fair enough. I'd need to see how they have these systems priced, and how much the savings would be to see if it would be worth it. And I still have unanswered questions, such as: How expensive is it to remove and reinstall the panels in the event of a new roof installation? What is the cost to dispose of panels that have no more useful life? And who fixes these panels in the event of a problem (and how many are qualified to fix them)? I'm still not sold on this concept, but the idea is interesting.

Jack_in_VA
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North, VA

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I just can't make the numbers match. 19.92 years to break even would be beyond my estimated lifespan.
XXXXXXXXXXX1
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said by Jack_in_VA:

I just can't make the numbers match. 19.92 years to break even would be beyond my estimated lifespan.

And that assumes you have no repairs needed to your system, the system performs as calculated, and no damage or wear and tear occurs to your roof requiring extra handling of the panels.

Even if one solar panel penetration point on the roof leaked during a good rainstorm, that could make for a real mess and a costly repair, wiping out a portion of the savings of the system.
ke4pym
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Charlotte, NC

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said by XXXXXXXXXXX1:

Fair enough. I'd need to see how they have these systems priced, and how much the savings would be to see if it would be worth it. And I still have unanswered questions, such as: How expensive is it to remove and reinstall the panels in the event of a new roof installation? What is the cost to dispose of panels that have no more useful life? And who fixes these panels in the event of a problem (and how many are qualified to fix them)? I'm still not sold on this concept, but the idea is interesting.

Again, the local installers will be able to help you with that. Personally, I had my roof redone a month prior to the panels being installed. Since the sun no longer shines on that side of the roof, it should be a non-issue.

However, should you need to have the array taken down, you're going to be charged for then market rates.

The installers should be on the hook (should they be in business) if anything fails.

My panels have a 25 year output warranty on them. Ditto for the inverters and 10 years of warranty on the install. But, like anything else, stuff changes. So if something breaks you'll have to fix it if the installing company goes belly up. If I'm still alive and in this house in 25 years, I'll be looking to put the new fancy high-tech stuff up on the roof to get another 25 years of service.

The last thing I think will be a problem is the roof leaking. They installed some bang up hardware and there's not going to be any leaks. Search my post history if you want to see more on my install.
Zach
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Llano, CA

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It also excludes and financing charges if you aren't paying out of pocket, possible setup and/or monthly charges imposed by the utility for bi-directional or 'net' metering and, possibly, added homeowner's insurance premiums (don't want to risk that 40K investment on your roof). I did some wind generation just because I have the $$ and could all the while knowing, good and well, I'd probably check into the 6' deep horizontal hotel long before I see any ROI. The only tangible return is seeing the arrow on the meter point in the direction of exporting energy when the wind is blowing. Seeing the lights burning for "free" is kind of satisfying too. Some people go on cruises and take nice vacations and I mount wind turbines on my barns and grain bins.

Cynical old geezer mode /ON

The problem with this is the same as with just about everything else. All of the players involved besides you are guaranteed a green return. Regardless of what they all say, utilities are in business to sell their services and maximize their ROI - they really don't want to deal with the piddly amount of unreliable "green" energy that we export. Small-scale, unreliable co-generation is a logistical pain in their collective asses but they must remain PC about it. The regulators gave them no choice. Many utilities are now adjusting their rate schedules to reflect how they feel about the "green" movement and to guarantee they make some green on our 'green' power exports. Unfortunately, utilities that officially offer 1:1 are the exception. Then we have the 'green' energy equipment suppliers..... They don't give a rat's behind if the real-world numbers work or not. They butter their bread by selling 'green' stuff. Profit made and seeeee ya. Will any of these companies still be in business in 20 years to service your now failing system? Possibly but doubtful. Let's not forget the banks loaning out the greenbacks to finance much of this stuff. Most will probably use some form of loan where the real estate secures the loan. Either they get their ROI or your real estate; you choose.

Cynical old geezer mode /OFF

This is not to say that technology won't come to pass that will really make the numbers work or that current technology doesn't work well in some parts of the country (World). For most, we aren't there yet. Even a change in battery technology can make a huge difference. Once the time comes where we average folks can reliably and safely store a sizable amount of excess generation at a reasonable cost, it will get interesting. A hint that we've arrived in the renewable energy for everyone is cost-effective age will be when subsidies disappear and the accounting stands on it's own. Although it's definitely worth a diligent investigation, if savings and ROI are your primary objectives, doing anything with solar in CT will probably lead to disappointment in the near term. If you just like seeing your meter run backwards on a sunny day or the feeling that you are doing something "green" and those are enough of a return to warrant the expense, then, by all means, go for it. I'm the first to admit there is more to life than money.

Good luck and keep us posted!

seaquake
MVM
join:2001-03-23
Millersville, MD

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Replying to the OP, but my question is for the folks who have systems installed. After having an array installed, did it affect your home hazard insurance premiums, and if so, by how much? My suspicion is that it would cause an increase (maybe a slight one, maybe not so slight) which should also be figured in to the ROI.
XXXXXXXXXXX1
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XXXXXXXXXXX1

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I don't know about homeowner's insurance, but in some states, the new panels would trigger a revaluation for property tax purposes. Here in CT, property taxes are high already.