Incentives to rise for home solar arrays - A new law will double the cap on how much energy ...

[OKIsItJustMe]

http://www.latimes.com/business/la-fi-solar-metering26-2010feb26,0,4702597.story

Incentives to rise for home solar arrays

A new law will double the cap on how much energy customers can sell back to utilities.

By Margot Roosevelt

February 26, 2010

At least 10 times a day Andrew Kin clicks onto the Internet for the pure joy of watching his electricity meter run backward.

The 30-year-old business consultant placed an array of rooftop solar panels on his Westwood duplex last fall, and thanks to a website provided by his installer he has watched his monthly electricity bills drop, in real time, from $50 to about $10.

"I make up a little chart every day," Kin said. "This past week was sunny, so I was electricity neutral about every other day, which I'm excited about."

Friday, Gov. Arnold Schwarzenegger is expected to sign legislation that will make it possible for more Californians to sell the electricity they produce back to their utilities at retail prices.

...

[Warpy]

1. Here in the desert southwest, our flat roofs and >300 days a year

of bright sunshine would seem to be ideal for solar panels on rooftops. I looked into it, though, and found the payback period would be over 50 years because I'm such an energy miser.

Eventually, I might start doing the plug 'n' play panels from Lowe's, but the price of electricity will have to climb a lot before it's economically attractive.

[OKIsItJustMe]

2. How recently?

http://www.energy.gov/taxbreaks.htm

...

RESIDENTIAL RENEWABLE ENERGY TAX CREDITS
Consumers who install solar energy systems (including solar water heating and solar electric systems), small wind systems, geothermal heat pumps, and residential fuel cell and microturbine systems can receive a 30% tax credit for systems placed in service before December 31, 2016; the previous tax credit cap no longer applies.

...

http://www.dsireusa.org/

[Warpy]

3. couple of months ago

and I used a website that took the energy credit into account, along with monthly bill and KWH usage.

When it comes to energy use, I'm a miser.

[Statistical]

5. Misterliness will have no affect on payback.

Someone who uses 10x the energy of you would have a 10x larger bill but to offset that they would need an array 10x larger.

Someone who uses 1/2 the energy of you would have a bill 1/2 as much but to offset it would only need an array half as big.

See post #4. Payback period isn't anywhere close to 50 years. 15 years, 20 years maybe. Not 50.

[Statistical]

4. Your miserlyness shouldn't affect payback.

If you use less energy then you need a smaller array.

The only things that affect payback are
utility energy rate (varies from $0.06 to $0.15 per kWh) - higher = faster payback
Incentives (there is 30% federal credit but some states offer incentives also) more = faster payback.
Solar Insolation (varies from about 3kWh per m2 per day to about 7kWh per m2 per day) higher = faster payback.
Cost of array installed (runs about $5.50 to $8.50 per watt installed) lower = faster payback

I am in Virginia and payback is right around 15 years with current prices and incentives (and installing array myself).

Likely you did something wrong if you are getting 50 years.

I am curious if you don't mind.

Post your:
1) annual usage in kWh
2) utility rate including all fees and taxes*
3) your state (to get solar insolation and credits)

Likely there is a modest array that can get you a payback in around 10 years.


*Easy way to estimate is to take monthly bill subtract $10 for connection fee and divide by kWh used for aproximate inclusive rate.
Example: $80 for 680 kWh. $80 - $10 = $70 / 680 = 10.3 cents per kWh

[Warpy]

6. The payback period is correct. We have remarkably cheap power

here in NM. I'm a miser because that's my nature, not because power is prohibitively expensive the way it is in Texas and Florida.

Likely those two places, I'd already have solar in place.

[Statistical]

7. Then that is it. The low power rate is what is making payback long.

If you used 10x as much power payback period would be just as long (or short).

Still if you are willing to buy components online and do your own labor (which is legal just get electrician to certify is) you can save a lot.

[OKIsItJustMe]

9. There are economies of scale here

http://www.solarpower.org/Articles/solar-power-installation-breakdown.aspx

[Statistical]

12. Agreed there are some economies of scale

mainly from the inverter. A 4000 watt inverter isn't twice the cost of 2000 watt one.

However the panels themselves are perfectly linear. 2KW in panels costs exactly double 1 KW in panels.

My point was more than being miserly isn't changing the economics *much*. Instead of saying "no effect" I guess I should say "minimal effect". A power hog isn't going to get repayment in 10 years and a miser in 50 years.

[kristopher]

13. We're at $3.50/w all in and haven't begun to tap economy of scale yet.

Economy of scale for solar is most applicable to the manufacturing process. If you buy at $5/w I think you will be over-paying unless you are in a hurry. The entire range of products for a system are perfect for high volume, automated production ala televisions. We are especially starting to see this with thin film. Nanosolar is is below $1/watt out the door, and leaked document from their German facility indicated a production cost of 30 cents a watt. While other companies are investing in thin film ink jet manufacturing technologies, there simply hasn't been time for any real competition at this level to develop.

The installation portion involves a lot of structural considerations to strengthen the assembly against the forces of wind; a lot of the cost of installation labor involves addressing that issue. We've seen one design that deals with this is Solyndra. I've read some credible analysis based on public data from projects they've done that indicates the final price of their products (at big box commercial scale) is $3.50/watt. Their production capacity is sold out for the next 3 years even though they deal only with commercial buildings and utilities.

And on the way to distribution for home systems there will be similar, knock off technologies that are on their heels with new production. The consumer electronics area is well built up and there is a solid infrastructure in place that eases the obstacles to market entry and exit - a big consideration for capturing benefit for the consumers. And while Solyndra's product and concept are unique; I doubt if they are unique enough to prevent competitors from easily coming up with 'improvements' sufficient to ensure there is no monopoly on the general concept.

So, the prices and products are already here, they just haven't filtered down to the individual home scale yet. The prices posted for average costs are weighted heavily in favor of last generation technologies and these new developments and their radically different price profile should be looked at when taking them as a guide for near term pricing.

[OKIsItJustMe]

15. I'm guessing you didn't follow the link I provided

http://www.solarpower.org/Articles/solar-power-installation-breakdown.aspx

...

An Overview

Here’s a full breakdown of component prices, let’s look at the overall picture seeing how big each “slice” of component or labor is compared to the whole. With many years of experience and information coming in from all over the world, solar-related non-profits and trade associations have come up with some pretty accurate numbers about residential installations:
Complete systems installed: $8-$10/watt

* 1 kW System: $11-12,000
* 2 kW System: $16-20,000
* 3 kW System: $24-30,000 (present example)
* 4 kW System: $31-35,000

...

So, for a 1 kW system, the cost is $11-$12/watt.
For a 4 kW system, the cost is $7.75-$8.75/watt.

That's what I call a significant economy of scale.

[kristopher]

16. And how will it compare to what I suggested?

I was pretty specific and your post is not a response (again).

[OKIsItJustMe]

17. Yes, you were quite specific

"Economy of scale for solar is most applicable to the manufacturing process."


My initial response was to a message which said "Your miserlyness shouldn't affect payback."

My link has nothing to do with the manufacturing process. It has to do with cost/watt for a residential installation.

The larger the home installation, the less expensive it will be per watt. So, yes, miserliness would affect payback time.

[kristopher]

18. .

:crazy:

[Massacure]

10. Your utility actually lets you install the panels yourself?

I was under the impression that most utilities required a licensed electrician to do the installation in order to be eligible for net metering.

[Statistical]

11. It simply needs to be certified to code.

So you will need an electrician come out and certify it is to code.

I know two people to installed their own arrays and then had electrician certify it. I provided some free labor and learned quite a bit. Since electrician is needed to come out and certify they also had the electrician do the work from inverter to the breaker and install grid disconnect. In most houses the breaker panel is always energized. Personally electricity doesn't scare me but working with live mains is a little beyond my comfort level.

So it doesn't take an electrician completely out of the loop but it does cut down on labor costs. $300 - $400 vs $2000 - $4000. A lot of PV work is just boring and "unskilled" setting up rails and connecting the panels together. Most panels now use a standardized connector called MC-4 which makes it pretty easy.

[kristopher]

14. You wrote, "the price of electricity will have to climb" - not really..

The more likely path is that the price of solar will drop and attractive strategies for financing will be incorporated into the regulations governing our grid.

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=115&topic_id=233181&mesg_id=233239

[Statistical]

8. I don't live in CA but it is nice to see good legislation.

Personally I am waiting for price of solar to fall below $5 (all in including federal credit).

That would give me personally 10 year repayment if I financed the array with HELOC.

I am not looking to replace all my energy usage just about 70%.

Hopefully in next couple years (before credit expires) we get down to <$5. Getting close if you buy components online and do your own installation.