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Solar Photovoltaics estimate -OMG!
Old 04-21-2011, 11:08 AM   #1
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Solar Photovoltaics estimate -OMG!

Finally decided to move forward with the idea of installing solar photovoltaics. Gathered all my electric bills, determined what my annual energy comspumtion was (had to extrapolate 30 months of the year, as only moved into the house 9 months ago) and had a nice talk with the solar installer in the area with the best reputation, most exerience, etc.
Goal was to replace 80-90% of our energy usage.

Just got the estimate - for a 22kW system, between $125K and $150K. Guess I was naive, but that just about gob-smacked me.

Granted, Federal and State tax breaks will cover ~80% of the cost, but I'm having a hard time justifying a very large capital outlay to capture a breakeven of 12 - 15 years (assuming no maintanence cost - ie. replacing inverters, etc., but using a constant cost of electricity in todays dollars).

While I'd REALLY like to become energy neutral (or alternatively, hedge against rising energy costs I expect to come down the road), even with the ridiculously large subsidies available, I'm hard-pressed to be able to justify the up-front cost.

Note - have already invested in additional insulation, energy star appliances (as all the appliances died shortly after we bought the house- sigh), the house has high efficiency zoned A/C, etc. etc. so have essentially done the less expensive things to reduce our energy comsumpton).

I'm beginning to think that I ought to just keep the capital invested and continue use that to pay the energy bills. Lose some of the energy independance, but gain flexibility.

NORDS - you out there
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Old 04-21-2011, 11:21 AM   #2
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Your costs are about in-line with what I have seen.

What do you pay for electricity (per kWh) ?

at 20 cents per kWh, the payback is about half of what you posted.

I am sure you have thought this through, but here's a little discussion of solar panel economics:

Green Living with Solar Panels: Economics of Solar Panels | Living Green and Saving Energy
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Old 04-21-2011, 11:37 AM   #3
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Wow, 22kW?

I use 300-500 kWh per month, except during A/C season, when it's more like 1000-1500, so let's say about 9000 kWh annually. Solar Calculator : says I'd need about an 6kW system to replace 100% of my usage. YMMV, of course...
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Old 04-21-2011, 11:49 AM   #4
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Not sure what the price/kWh is, I was just comparing my annual billed costs to the final out-of-pocket cost of the system.

Thanks for the link - those were about the numbers I had anticipated from everything I had read, and I had justified to myself the investment at those returns, but was really amazed to be off by more than a factor of 2.

I'm wondering if my electrical cost/ kWh is exceptionally low - will have to wait 'til I get home this weekend to check that out.

Which brings up an interesting conundrum - if they ARE low, essentially my costs are already being subsidized, after some fashion. If I anticipate the subsidies will go away, the costs will increase, and that would decrease my pay back time - sometime in the future.
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Old 04-21-2011, 11:54 AM   #5
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Yeah, 22Kw seems big to me too. Though maybe that's just your lifestyle. I bet a lot of the cost is the labor as well. Maybe you could save by doing a lot of the mounting and wire running work yourself and just having an electrician do the final 10% of the work connecting and checking everything.

Mr. Solar sells an 8.28Kw system for $23,600.
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Old 04-21-2011, 11:57 AM   #6
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22Kw is a huge system.
I would first try to figure out where you are using the energy. It is a lot cheaper to conserve than to just add pv panels (except the very smart way Nords does it).
If that doesn't do it, get an 'energy audit' (most utilities in my area will do this, not sure how widespread this is).

Then, get competing quotes, and check out the companies that lease pv systems.
Solar City is one such company (SolarCity: Solar panels, solar leasing & financing for residential, commercial and government. $0 down solar lease—solar installation financing.). Not sure if they serve your area or not, but this business model seems to be expanding, so hopefully there is something in your area.

Good luck!
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Old 04-21-2011, 11:57 AM   #7
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Just did some math from my spreadsheet - costs are almost exactly $0.10/kWh.

HFWR - Once I started looking at the "kWh used" on the bills, I was surprised by the energy consumption of the house as well. Ranged from 1070/mo to 6500/ mo. Ironically, the highest months were in the winter (electric heat. Ouch)
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Old 04-21-2011, 12:04 PM   #8
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I have an energy audit scheduled for early May and will be meeting with the solar company again after that.

I am also hoping that I have mis-read my electrical bills; have dropped a decimal point in the wrong place or something , because we shouldn't be using that much juice - house is < 3000 sq ft, no swimming pool, no huge energy drains that I find - the energy audit is DEFINATELY in order.
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Old 04-21-2011, 12:10 PM   #9
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Originally Posted by EllisWyatt View Post
Which brings up an interesting conundrum - if they ARE low, essentially my costs are already being subsidized, after some fashion. If I anticipate the subsidies will go away, the costs will increase, and that would decrease my pay back time - sometime in the future.
Is there some reason to believe your electricity costs are being subsidized? Maybe you just live in a place where it is cheap to make electricity.

I know you don't need much heat in NOLA, but using PV to make electric heat (heat pump or resistance heat) is very costly (really--crazy). You'd be better off with direct solar heating (of air or another working fluid). Or, just stick with your present grid-powered heater for the 2 days each year you need heat.

If you don't have a ground source heat pump (GSHP), you might crunch the numbers and see if installing one would be cheaper than buying the PV capacity needed to run your present AC system. There are tax credits for the GSHPs, too. They would also heat your home and can produce "waste" hot water for domestic use in the cooling season (basically, 10 months per year for you).

Did you subtract out the electricity you are now using to heat water? You don't need or want PV for that--again, direct solar heating of the water (with a backup system for cloudy days) makes much more sense than PV-powering of resistance elements. No one would do that.

Lighting: Is nearly everything florescent or LED? If not, convert and subtract even more energy (savings of approx 60% on the lighting energy, savings of the energy needed by the AC to get rid of the waste heat from the incandescent lights).
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Old 04-21-2011, 12:12 PM   #10
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I am guessing the electric heat is a huge draw. You can probably fix/update that or even replace it with a more efficient system for a lot less than the cost of PV panels to offset it.
Identifying where the electricity is going is the most important step
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Old 04-21-2011, 12:17 PM   #11
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I see you live in the deep south too. For reference, my energy consumption for a house about 2,500 sq. ft. ranges from 1000 KWh per month during the mild spring and fall months to about 2,500 KWh in February, the coldest month of the year (all electric heating). Our house is older and not particularly well insulated (we still have single-pane windows).

I hope the 6,500 KWh/month figure is a typo.
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Old 04-21-2011, 01:28 PM   #12
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The electric heat was a HUGE draw, and the system is a 5 yo "high efficiency" unit. Unfortunately, the 6500kWh was the usage listed on my bill. We had the coldest winter on record here (down to 19 degrees at night several times) during that month. Oddly, the bill worked out to ~$0.07 kWh, which is making me seriously wonder if reported kWh/mo usage on the bills is accurate. (I actually live a bit north of NO on the other side of the lake in the country)

House is only 5 yo - post Katrina. Thermal-paned windows, ridge/soffit vents, r-32 isulation in the attic - I can' figure out why the usage is so high.

Samclem - After the energy audit , if it turns out that my reading of the usage from the bills is accurate (which I'm doubtful, but hoping I've mis-read somehow), we may look at converting one of the wells into a source for GWHP. A good idea.

Word "subsidized" was probably a poor choice : no political overtones and wasn't meant to be a "flash" word; just comparing the lower cost of electrons here vs. elsewhere. Could be lower cost of fuel, regulations, plant operating costs, any number of things, but the ultimate result is that I appear not to be paying as much per kWh as others do elsewhere, which affects the payback period for installing a PV system.
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Old 04-21-2011, 01:57 PM   #13
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The electric heat was a HUGE draw, and the system is a 5 yo "high efficiency" unit. Unfortunately, the 6500kWh was the usage listed on my bill. We had the coldest winter on record here (down to 19 degrees at night several times) during that month. Oddly, the bill worked out to ~$0.07 kWh, which is making me seriously wonder if reported kWh/mo usage on the bills is accurate. (I actually live a bit north of NO on the other side of the lake in the country)

House is only 5 yo - post Katrina. Thermal-paned windows, ridge/soffit vents, r-32 isulation in the attic - I can' figure out why the usage is so high.
We also had the coldest winter in 50 years. The temperatures dropped many times in the teens and below this winter and we even had snow several times, which is very unusual. Our heat pump is 3 year old and we didn't choose a high efficiency unit (13-seer). I don't know why your usage is so high either.
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Old 04-21-2011, 02:05 PM   #14
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I have nat gas for heating, cooking, and hot water, so my elec usage would be higher in the winter otherwise. Though my gas bill last month was $20.
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Old 04-21-2011, 02:36 PM   #15
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Originally Posted by EllisWyatt
I have an energy audit scheduled for early May and will be meeting with the solar company again after that.

I am also hoping that I have mis-read my electrical bills; have dropped a decimal point in the wrong place or something , because we shouldn't be using that much juice - house is < 3000 sq ft, no swimming pool, no huge energy drains that I find - the energy audit is DEFINATELY in order.
We have 12kw of panels for a nominal 10kw system (taking efficiency losses into account). Our home is about 4300 sq ft, built to keep cool in the summer with a wrap around farm style porch. We do use the AC, but perhaps less than most homes that size would use in our area. We have 2 refers, electric laundry dryer, and a 38 foot pool. This is our home in the USA. The lights are CFLs but most all of them in the house burn 24x7 as a deterrent, while we are living overseas. Refers stay on. The pool filter and salt water chlorine generator run 5 hours a day all year long.

...and our 10kw system handles all of that with a couple thousand kwh to spare most years. (it is rated to put out about 18,000kwh per year based on the system specs and insolation values for our area).

Efficiency is much more cost effective than solar is, so take the time and spend the money to do the audit, train yourself on efficiency, and replace aging energy hogs first. Then re-evaluate the PV system. I'm sure you can get by with much less that a 22kw system, but you should get it professionally installed.

Good luck

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Old 04-21-2011, 03:19 PM   #16
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If the solar panels are installed, does the power company pay you if your panels pump power back into their system. I remember hearing about that, and seeing on TV where places equipped with solar panels make their meter run backwards on days of strong sun.
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Old 04-21-2011, 03:35 PM   #17
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If the solar panels are installed, does the power company pay you if your panels pump power back into their system. I remember hearing about that, and seeing on TV where places equipped with solar panels make their meter run backwards on days of strong sun.
In CA the power companies offer net metering...the meter runs backwards on sunny days and forward at night and in bad weather. Once a year, they tally up the plusses and the minuses. If you made the same as you use, you owe nothing. If you use more than you make, you pay. If you make kore than you use, you don't even get a "thank you" let alone a check in the mail.

There is also Time of Use metering. The charge is higher in peak use hours and lower in off peak hours. Fortunately, the sun shines in peak hours, meaning you avoid using electricity during those hours and you get more credits. You then have more credits (available power in the form of kwh) to use in off peak hours than you would in normal net metering. Thus, if you know what you are doing and can adjust the time of day of your major power consumption to offpeak hours, you can do more with a smaller PV system. This is no offered everywhere though, so talk to your provider.

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Old 04-21-2011, 05:24 PM   #18
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If the solar panels are installed, does the power company pay you if your panels pump power back into their system. I remember hearing about that, and seeing on TV where places equipped with solar panels make their meter run backwards on days of strong sun.
In Minnesota, my utility pays me on a monthly basis for excess solar generation (basically at the same rate of their standard rate).

This varies widely from place to place, so check carefully.
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Old 04-22-2011, 11:47 AM   #19
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In Louisiana, the net metering program is set up such that the power company will credit up to you annual usage - they won't pay you for any excess, but -theoretically - you could end up with a $0 bill at the end of the year. But the state has a VERY attractive tax credit program, so that sems more than fair to me.

Thanks for your inputs and observations. Thought I was ready to pull the trigger on installing the PV, but it looks like I've just taken the first steps down the road of what may be a bit of an odessy. Oh well - always good to have a new project.
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Old 04-22-2011, 10:18 PM   #20
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Goal was to replace 80-90% of our energy usage.
Just got the estimate - for a 22kW system, between $125K and $150K. Guess I was naive, but that just about gob-smacked me.

NORDS - you out there
Sorry, big south shore surf this week. Got kinda busy around here.

Looks like you have two and maybe three problems to solve.

First, someday when the heat & A/C aren't running (I know, New Orleans, but it's still April), try shutting off all the lights in your house and whatever other loads you have running, and see how much power the meter is using. Then try popping one breaker at a time to figure out what circuit is using the power. Maybe the meter is working fine, maybe someone has an extension cord plugged into one of your outside receptacles, maybe an electric heater is stuck on at a low temperature setting, maybe the oven is maintaining 160 degrees, or maybe something else (TV, desktop PC, entertainment system) is sucking down a huge vampire load. Maybe the beer fridge has a leaky gasket or the chest freezer has a broken thermostat. If you have more than one fridge then you should seriously consider getting rid of all but one.

You might be able to do the energy audit online from your power company's website, which already has a record of your electric bills. That much electric heat is either going straight down into a concrete foundation (to heat the ground) or leaking out of the house somewhere. There might be an insulation leak in the attic or an air hole in one of the rooms. If our teen was living at home then I'd suspect someone opening or shutting their room windows to avoid having to negotiate over the thermostat settings.

Second, if you have a sunny neighborhood then you might think about converting your water heater to solar or tankless (gas). A solar water heater's much more efficient than heating water with PV electricity. Around here, with not many homes using A/C or heat, a water heater can be up to a third of the electric bill. Solar water has federal tax credits and might even give you state tax credits.

Third, while you're lowering your consumption, think about where you could put PV panels and just try to fill that square footage instead of zeroing your electric bill. You could probably fill up your south roof with 200-watt panels (one microinverter per panel) or 300-watt panels (with two or three 3000-watt inverters). That'd give you about 3-6 KW for about $4-$8/watt. If your tax credits have annual limits then try to have the installer design a system that you can expand every year to maximize your fed/state credits. Installers don't like that but it's better than no sale at all. They might agree to fill your roof with racks on year #1, put up maybe a quarter or a third of your total number of panels, and return each year with a few more panels to fill the racks.

If your utility provides power at 7-10 cents a KWhr then you're gonna have a fairly long payback. No home buyer will pay up for PV so you'd want to stay put in that house for 7-10 years.
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