Community Solar Anybody?

[Koolau]

Alternative renewable energy availability drives up the value of the house, depending on the buyer. Bankers are starting to change their ways as well. Just had this discussion last night with a friend of mine who is a President of Emprise Bank in Kansas. He said they are starting to include solar value in home value assessments.

I have a friend who tried to sell his beautiful home in Portlock here on Oahu. NObody wanted to pay the cost of his solar system that he had added. Folks wanted to pay the comp price of the houses around that didn't have solar. YMMV

 

[Koolau]

Proselytizing never works as well as those doing it thinks it will. It often has the opposite effect.

I'm all for solar, and we've had quotes within the past year. But where I live that means a new roof (don't yet need) and an installation investment, for a home I may very well sell in 5 years. So we'll look at it down the road.

(yes I recycle, reuse and reduce my plastics, watch my water and electric usage - there are many other things one can do that do add up when more of us do them).

That's kind of where I am. I recycle, attempt to live a low foot-print life, etc. I'm all for solar but it has to w*rk. We've more or less run out of areas where HECO can absorb extra electricity produced by solar on private houses, etc. Conversely, their solar system failed us a couple of days ago (sun didn't shine.) and we had rolling black outs. Solar (in general) is good. Not being able to integrate it into the grid (consistently) is bad. Maybe some day.

 

[stephenson]

I do not make decisions, especially about the future of my children ... and planet ... based on money. Do the numbers matter? Sure. But, my view has always been that we are in this together.

In my view, every single family home should have an EV system (assuming suitable solar incidence), but if groupings of homes can be more effectively powered by a group approach, then even better - the best engineering solution should win. This should be, in my view, supported by government policy.

Condominiums, assuming they have suitable solar incidence (think FL, AZ, CA, NM especially) are great places to use solar systems. Small roof area per SF of home, but there are usually parking garages, common areas, breezeways, etc where panels can be placed.

It can't be only about the raw cost to each of us - this is bigger than each of us.

 

[GaryInCO]

I signed up for community solar in mid 2022. It wasn't a great deal, basically pay the solar garden instead of the utility, no big savings or anything. And no protection from future rate increases. But I figured it was at least encouraging solar construction.

After a year I got tired of waiting, and I decided to apply some IRA money to my own solar system. We turned it on last month -- and literally 2 hours later the solar-garden people said "OK! Your spot is ready now!!" Too late guys ...

Re: the cost. I don't look at ROI. For one thing I think it's the right thing to do, doing my part to reduce my footprint. But also I think it's more accurate to think of my solar system investment as an "annuity." If you buy an annuity, it pays you $X per year for your lifetime or other period. Similarly my solar system will erase my electric bill, which (given my usage patterns in the last several years) will save me about $1700 per year. The solar system, after IRA credits, cost just over $22k. $1700 return on a $22k investment is just under 8% per year -- guaranteed, and tax-free. And inflation-adjusted, since my electric bill will stay at zero no matter how high the power rates go. I think that's a pretty good reward for doing the right thing.

When I or my children sell my house, I believe the buyer will find value in a zero-electric-bill property, and will value it appropriately. NREL says each dollar of electric bills that are reduced by your solar system will increase your resale value by $20. $20 * $1700 = $34,000 -- a great return on my $22k investment, and I assume that number will increase as power bills increase. Zillow says homes with solar system sell for 4% more than those without.

That worked well enough that I plan to replace my 30-yr-old SEER-10 AC with a heat pump, driven by solar, so I can get rid of (most of) my gas bill too. (I'll probably keep the gas furnace as backup heat for subzero weather. I'll still have a gas range and water heater.)

 

[GrayHare]

Given the importance of ROI, mass adoption of renewables will take a fundamental change in taxation. Eliminate income tax and institute a carbon tax, and suddenly solar will look a lot better.

 

[ERD50]

... NREL says each dollar of electric bills that are reduced by your solar system will increase your resale value by $20. $20 * $1700 = $34,000 -- a great return on my $22k investment, ....

Zillow says homes with solar system sell for 4% more than those without.

Sounds like fuzzy math.

So I could buy a house w/o solar, add it on for $22K, and have a new system with a new warranty, or pay $34K for an old system with fewer years warranty, and more expenses looming (inverter replacement, roof repairs?)? Color me skeptical.

I suspect the Zillow data follows the same logical fallacy as a Freakonomics study I read about. It was determined that homes with lots of books were correlated to children who did well in school, so a well-meaning group decided to buy books to put in all the school's kids homes.

But it wasn't the books that made the difference, it was the fact that those homes valued books, and that was reflected in how they raised their children. The books were the effect, not the cause.

So I suspect that on average, people who invest in solar plan to live in that home for many years, and maintain it and treat it well.

... But also I think it's more accurate to think of my solar system investment as an "annuity." If you buy an annuity, it pays you $X per year for your lifetime or other period. Similarly my solar system will erase my electric bill, which (given my usage patterns in the last several years) will save me about $1700 per year. The solar system, after IRA credits, cost just over $22k. $1700 return on a $22k investment is just under 8% per year -- ...

I think I said this earlier - an annuity is a good analogy, because you are giving up your principal. So it's not an 8% return on your investment, it's an 8% return of your investment. If the value of the system is near zero in 30 years, that's a 3.3% hit on your 'return', so closer to 5% return (more/less, depending on maintenance costs, degradation, or rates rising faster than inflation. And a 30 year investment with an inflation adjusted 3.3% WR, will very likely have increased in value.


-ERD50

 

[ERD50]

Given the importance of ROI, mass adoption of renewables will take a fundamental change in taxation. Eliminate income tax and institute a carbon tax, and suddenly solar will look a lot better.

Right, but how can we put a $ figure on carbon emissions? And do I get a credit for driving 1/4 the miles (I suppose if the carbon tax was built into gas prices)? But that would be considered unfair to lower economic classes that need to drive to get to work .

And what about China? Oh boy, this is going down a rabbit hole! I better stop!

One more - Early 1900's a major pollution problem was horse manure and horse carcasses in the streets of large cities. They could have spent millions/billions on the problem, but it went away with new technology. Maybe we will have some sort of carbon sequestration tech in the future that makes all this moot? Who knows?

OK, I lied, one more... the whales were becoming extinct due to over harvesting for lamp oil. Until petroleum was found that could just be pumped out of the ground. No one saw that coming either. So ironically, the oil industry has probably done more to save the whales than Greenpeace?

-ERD50

 

[hotwired]

Couple of years experience

I own apartment buildings and have had as many as 10 signed up. About the only pain in the butt is it takes 2-3 months to get off if you're not feeling it. At least with community which is actually Arcadia at least in Maine. I've also used Nexamp and Nautilus. Basically THEY pay your power bill, then bill you for reimbursement minus 10-15,%. It's always worked, I've gotten a few $50-$75 gift visa cards. And they are surprisingly responsive with questions...i literally have to ask them full re explain things to me about every 6 months!

 

[ERD50]

I own apartment buildings and have had as many as 10 signed up. About the only pain in the butt is it takes 2-3 months to get off if you're not feeling it. At least with community which is actually Arcadia at least in Maine. I've also used Nexamp and Nautilus. Basically THEY pay your power bill, then bill you for reimbursement minus 10-15,%. It's always worked, I've gotten a few $50-$75 gift visa cards. And they are surprisingly responsive with questions...i literally have to ask them full re explain things to me about every 6 months!

I don't understand how this works. What did you do in order for them to pay your bill?

Do you pay all the electric bills in those apartment buildings? Or just the common areas?

-ERD50

 

[GrayHare]

"Lower classes driving to work" sounds like a first world problem. If it's an issue, some of the carbon tax could go toward making mass transit free. How many pages does it take to express current US income tax laws? I suspect a carbon tax could be described in fewer pages, many fewer. A problem is that a carbon tax would encourage renewables, which means the dollar amount generated by that tax would decrease with time.

 

[hotwired]

It IS a little weird...

I don't understand how this works. What did you do in order for them to pay your bill?

Do you pay all the electric bills in those apartment buildings? Or just the common areas?

-ERD50

It is a little counter intuitive, honestly. First, THEY take over your account, or rather, you give them access to the account. They change the "contact" email so that THEY get the email from (in our case) Central Maine Power (CMP). They pay the bill, then re-bill me minus whatever I'm entitled to. It's a little confusing because it's not always a direct dollar match up. They estimate your usage, then give you a "chunk" of their solar farm which provides you with X dollars per month in energy. I THINK there's also a lag. So, in June they're paying you for April's bill. They DO pay the bill to CMP on time but then there's that lag.

To answer your other question, the accounts I had were only for apartments where WE included electric with rent. (We always gave tenants a choice, so some paid their own, in which case we couldn't take advantage of this solar deal)

If I had it to do over again, I'd keep a spreadsheet. There was an account that I had to cancel because I was selling the building and it took 3 months, 2 months after the building wasn't mine any more. I'm still scratching my head wondering if I ended up paying more than my share.

I used 3 companies and now only have our own house meter with them, and that is Nautilus. I found them easiest to deal with. Happy to give you a referral link to any of them that I've been with. I think we each get something extra if you sign up from a referral.

 

[jrgators]

I've been doing it for about 6 months. Basically get 10% credit on my electric bill for doing nothing.

 

[GaryInCO]

Sounds like fuzzy math.

So I could buy a house w/o solar, add it on for $22K, and have a new system with a new warranty, or pay $34K for an old system with fewer years warranty, and more expenses looming (inverter replacement, roof repairs?)? Color me skeptical.

Fair. I can't explain or justify their numbers since I don't know how they derive them. I think your point is valid, but the folks at NREL do believe it adds real resale value to the house.

I think I said this earlier - an annuity is a good analogy, because you are giving up your principal. So it's not an 8% return on your investment, it's an 8% return of your investment. If the value of the system is near zero in 30 years, that's a 3.3% hit on your 'return', so closer to 5% return

Also fair. But a guaranteed COLA'd tax-free 5% return is still a good deal.

But I think your numbers are off. Let's drop the annuity analogy and see how it works if I "loan" $22k to my system, so I do get a full return of my invested amount. My $1700 annual power bill is about $142 a month. A 30-year amortized $22k loan with a $142 payment has an interest rate of just about 6.75%. I think that's an accurate representation of the return on a $22k investment in a system with a 30-year service life. (4.75% if you project a 20-year service life.) And that doesn't factor in the near-zero risk, the inflation protection, or the tax-free nature of the solar "income."

Your point about return "of" investment is valid, but the return beyond $22k is return "on" investment and would normally be taxed. So with a 30-year service life you get a $22k tax-free return "of" investment, and nearly $30k of tax-free return "on" investment. And in fact you'll get roughly another $30k (still tax-free) from the inflation protection, assuming 3% inflation. I'm not sure but I think that adds roughly 3% to the return. Subtract some small amount for maint/repairs and I'd bet it's still over 9%, guaranteed and tax-free.

Still looks like a pretty good investment to me.

 

[MichaelB]

Let’s please not turn this into another debate on climate science. Community solar is a novel idea and folks here should be allowed to explore it without distraction.

 

[ERD50]

Originally Posted by ERD50 View Post
I don't understand how this works. What did you do in order for them to pay your bill?

Do you pay all the electric bills in those apartment buildings? Or just the common areas?

-ERD50

It is a little counter intuitive, honestly. First, THEY take over your account, or rather, you give them access to the account. They change the "contact" email so that THEY get the email from (in our case) Central Maine Power (CMP). They pay the bill, then re-bill me minus whatever I'm entitled to. ... They estimate your usage, then give you a "chunk" of their solar farm which provides you with X dollars per month in energy. ...

Thanks, but I still don't understand. You must have put some money upfront?

Otherwise, it just sounds like they are paying part of your bill, just for fun? Why would they do that?

-ERD50

 

[CaptTom]

Thanks, but I still don't understand. You must have put some money upfront?

Otherwise, it just sounds like they are paying part of your bill, just for fun? Why would they do that?

Yeah, this is the part I've been trying to figure out. To the best of my meager brain's ability, here's what I think is going on.

You sign up to get a share of some sort of green energy credits or legislation. There's plenty of capital around looking to invest in "green" projects. They need someone to sell the power to. Probably - and I'm guessing here - there's a state law which requires the power company to buy the output of these "community" solar farms at something near wholesale prices. You get some portion of the margin between that and retail rates.

I did notice that it's not a flat percentage of your bill. It's a percentage of the percentage of your bill which is attributed to the solar farm.

My way of looking at it is, it's just another one of those third-party electric providers many states now allow after "breaking up" the monopoly utilities. They offer some discount, but long-term you never know if that will continue, or if they'll even stay in business. I'm taking a wait and see approach.

 

[Sunset]

Yeah, this is the part I've been trying to figure out. To the best of my meager brain's ability, here's what I think is going on.

You sign up to get a share of some sort of green energy credits or legislation. There's plenty of capital around looking to invest in "green" projects. They need someone to sell the power to. Probably - and I'm guessing here - there's a state law which requires the power company to buy the output of these "community" solar farms at something near wholesale prices. You get some portion of the margin between that and retail rates.

I did notice that it's not a flat percentage of your bill. It's a percentage of the percentage of your bill which is attributed to the solar farm.

My way of looking at it is, it's just another one of those third-party electric providers many states now allow after "breaking up" the monopoly utilities. They offer some discount, but long-term you never know if that will continue, or if they'll even stay in business. I'm taking a wait and see approach.

We just got one of these letters, and I noticed this as well it's a percentage of some portion of my electric usage.

My letter from Nexamp says the credits will appear 2-3 months after the solar farm goes live, so it's not even existing yet !

My worry would be if they take over my account, and then go bust, I'd have to re-signup for electricity after finding out my power has been cut off for non-payment.

I think there must be some gimmick involved, as otherwise, they could just see what my electricity usage is on a paid bill, then send me a few dollars as rebate to my bank or directly on my electric bill (possibly my choice).

 

[Aerides]

Let’s please not turn this into another debate on climate science. Community solar is a novel idea and folks here should be allowed to explore it without distraction.

And again, multiple posts were removed. Please take your politics, commentary on Davos, and general climate issues elsewhere. This is about community solar, period. Leave it for those that actually want to discuss this topic.

 

[CRLLS]

We received a Nexamp letter yesterday saying it will save us 15% on our solar credits. What the heck is that? In my state, I would have to give up my hourly pricing that already saves me money. From my understanding, as more people sign up, my "share" of their solar farm would diminish unless they expand their farm.

I have very little faith in them doing that. I'm out as far as the cost saving goes.

 

[easysurfer]

Got my recent electricity bill. The stage is set. I believe next month I should start seeing solar credits on my bill.

It's a sunny day today. Translation, that solar project I subscribed to is producing energy for me as I type .

 

[Sunset]

Got my recent electricity bill. The stage is set. I believe next month I should start seeing solar credits on my bill.

It's a sunny day today. Translation, that solar project I subscribed to is producing energy for me as I type .

So let us know how it goes, as the Nexamp letter I got said a 15% of whatever percent is solar (probably from them), so doesn't seem to be 15% of our electric bill.

 

[easysurfer]

So let us know how it goes, as the Nexamp letter I got said a 15% of whatever percent is solar (probably from them), so doesn't seem to be 15% of our electric bill.

A Nexamp letter I received got the ball rolling but I was hesitant to go with them after reading some bad reviews of them. A complaint some said was Nexamp overestimates your usage. You end up paying for credits you don't even use up.

Instead I went through a community solar program through my community by starting with a search on my town's village hall and community solar.

 

[jrgators]

A Nexamp letter I received got the ball rolling but I was hesitant to go with them after reading some bad reviews of them. A complaint some said was Nexamp overestimates your usage. You end up paying for credits you don't even use up.

Instead I went through a community solar program through my community by starting with a search on my town's village hall and community solar.

I have Nexamp. Took a couple of months after signing up before the 'service started'. The Nexamp bill lags behind my electric bill by 2 months. When my electric bill comes, there's a credit equal to the electric portion of the bill. So I basically am just paying for the electric delivery charge. Then Nexamp sends me an electric bill equal to the credit that my electric company gave me minus 10%. So i'm saving 10% on the electricity without doing anything (other than signing up).

 

[easysurfer]

I have Nexamp. Took a couple of months after signing up before the 'service started'. The Nexamp bill lags behind my electric bill by 2 months. When my electric bill comes, there's a credit equal to the electric portion of the bill. So I basically am just paying for the electric delivery charge. Then Nexamp sends me an electric bill equal to the credit that my electric company gave me minus 10%. So i'm saving 10% on the electricity without doing anything (other than signing up).

That's good to see that Nexamp is working out for you. I read reviews about people not sure how to reconcile the two bills but looks like you've done that.

My set up (not Nexamp) sounds similar to yours with at least 10% savings on the electricity and two bills.

 

[CRLLS]

I have Nexamp. Took a couple of months after signing up before the 'service started'. The Nexamp bill lags behind my electric bill by 2 months. When my electric bill comes, there's a credit equal to the electric portion of the bill. So I basically am just paying for the electric delivery charge. Then Nexamp sends me an electric bill equal to the credit that my electric company gave me minus 10%. So I'm saving 10% on the electricity without doing anything (other than signing up).

Is the credit for the cost of electricity used, sans, taxes, fees, etc. I know that the electric company has to get their service paid. In my bill, the actual cost of electricity used is noticeably less than half of the total bill. Especially since I have hourly pricing which saves me a bunch to start with. I'd have to give up the hourly pricing to switch to Nexamp. I'm not sure if it makes any sense for me.