Attitude At the Gas Pump

Yow, how many kW is the combined array??
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_H*

 

<div class='quotetop'>QUOTE(darelldd @ May 2 2007, 11:36 AM) [snapback]434018[/snapback]</div>

LOL, well Darrell, we've spoken before, and I know you are ahead of the curve in most ways. I just try to keep a good perspective, someone out there is doing better than all of us, and all of us have things we could do better. I mean, I've designed close to 500kW of solar systems, but I know I don't bike as much as I could, and I don't even own an EV yet. Just trying to stay realistic, you know? Don't want to get that jealous god syndrome.

Beautiful system on your dad's place. What is it, 7kW? That is a great location, too. Good angle. And yes, to the person who mentioned it, it does actually protect the roof under it from damage.

In about a year we are expecting to start getting and installing MSK's building integrated PV modules. They are longer and skinnier, and are meant to mount right onto the roofing substrate instead of shingles. They become the roof, instead of just sitting on it. MSK sells in Japan only right now, but they were just bought by Suntech, who intends to bring their BIPV to the US, which is good news for us.

-Sam

 

<div class='quotetop'>QUOTE(phidauex @ May 2 2007, 01:56 PM) [snapback]434236[/snapback]</div>

Oh, I totally agree! I just found the post funny right after I was making fun of others for driving a gasoline car.

The system pictured is 5.5KW. It appears as if there are a bunch of panels hidden at the back, but you're really seeing all of it. Might be one more panel hidden back there. The orientation and angle are damn-near ideal. The only problem is the HUGE trees around the place. At mid-afternoon, blink - no more power.

 

I think most people really have no clue how the prius works. I can't tell you the number of times people have asked when you have to plug in to recharge. maybe they are just confused and dont realize you actually fill up the tank with gasoline!

 

<div class='quotetop'>QUOTE(darelldd @ May 2 2007, 09:36 AM) [snapback]434018[/snapback]</div>

What's an installation like that cost? Are there batteries, or does he sell excess to the grid during the day and draw from it at night? Is the return, in saving on the electric bill, better than he'd get by investing the money, or must one consider the "return" to be the environmental benefit?

I wonder what the people at the gas station will think if I use their free air to pump up the tires on my Xebra. Maybe I should buy a little tire compressor.

 

<div class='quotetop'>QUOTE(daniel @ May 2 2007, 02:34 PM) [snapback]434265[/snapback]</div>

I'd have to look back at my records for price. I'm not home currently, though! No batteries. Less than 1% of our installations use batteries - most are grid-tied. An investment in solar energy is typically quite a bit better than the average investment in the stock market - PLUS the evironmental good will tags along for free. The big hurdle is getting over the idea that you're paying for your next 40+ years of electricity at today's prices. As the price of electricity continues to climb, your investment pays dividends faster and faster.

Go one better and get a really good quality floor pump. I pump all tires - car and bicycle with a floor pump. And this from a guy who owns three electric compressors (that I use for pneumatic tools, plasma cutter, et). I can't pump for those, but I sure as heck can use my own power for any tire. Takes a while for car tires, but excellent exercise. And I see people paying $100/month at the gym performing this same exercise for "health." (don't even give me started on the ones who drive to the gym and then pedal a stationary bike for an hour, and then drive home).

 

What's an installation like that cost?

Prices vary some based on location and module choice, but nationwide average is about 9.00$ per installed watt, so this 5500W system would be right around $50k, average, before rebates and incentives (which can amount to nearly half the cost of the system, in some areas).

Are there batteries, or does he sell excess to the grid during the day and draw from it at night?

Battery based "off grid" systems only account for about 5% of US installations, they aren't practical unless you absolutely need them. If you've got a grid connection, then grid tie saves money, harvests more power (because the grid is never 'fully charged'), lasts longer, and does more for the environment.

Is the return, in saving on the electric bill, better than he'd get by investing the money, or must one consider the "return" to be the environmental benefit?

This is a very complicated question... In general, return on investment is higher than the DOW, as Darrell mentioned. But like stocks, it is unpredictable, because we expect power prices to rise, but we don't know when, or by how much. One thing is sure, however, people aren't going to STOP using electricity! In that sense, it is a very sound investment.

It is analogus to hybrid ownership, in some ways. In the end, you probably won't save a ton of money by buying Prius over a Jetta TDI, or other efficient small car. However, you get a lot more environmental "bang for the buck" with a Prius. You may spend the same, in the end, but you spent it much more wisely. Financial gain is really just a side benefit to knowing that you spent the same money you were gonna spend anyway, only you put into something better for the world, that generates lasting, long term value for your family and your home. You own your home as an investment, so why not own your power plant?

PV systems have a financial payback time that is still fairly long (calculated on todays power prices), but when we move to time-of-use metering that will make afternoon power very expensive, and nighttime power cheap (more in line with the actual costs of making it), it will cut PV user's financial payback time in half. (Time of use metering is already piloting around the country, and lots of places will be in time of use metering in a few years).

PV systems have a very fast environmental payback time. A grid-tied PV system in a good location at mid latitudes will offset the carbon released in its manufacture, and generate the energy required to build it, transport it, and install it in 1.5 to 2 years. We calculated the other day that the PV systems we install offset the carbon we spent physically installing it in about two weeks.

After that point, its all gravy.

However, the fact of the matter is, if you are a finances-only investor, there are better places to invest your money besides residential PV. However, if you have a bigger picture view, then PV is a conservative, but sound, investment in the future, that also has great environmental benefits. Plus all the other good stuff, like it protects your shingles, raises the value of your home, makes your neighbors jealous, etc.

BTW, Darrell and I both work for PV companies, he's an advocate, and I design systems. But we work in very different markets, so some things are a little different.

peace,
Sam

 

Thanks to both Sam and Darell for those answers. At present I live in a development where Solar panels are not permitted. The homes are all 3-unit or 4-unit townhouses, and the association is responsible for all the roofs. Solar would pretty much have to be an association decision. And the residents are all old folks, on fixed incomes, without money to invest or equity against which to borrow.

However, I may not be here for the rest of my life.

For my part, I'd put in PV for the mere cool factor. But my question had more to do with the ease of convincing John Q. Public to install solar.

Here's the way I'd analyse the finances:

Assuming Sam's figure of $50,000 capital investment: $50K in a bank CD would yield a return of around $2,500 per year in interest. Invested in the stock market, the return is subject to the vagaries of the market, but over the long term perhaps it would be twice that. A roof-mounted PV system for a given location at today's electricity prices would yield X dollars in the form of lowered electric bills plus cash from the electric utility if there's a net surplus produced, with the liklihood that over the course of time X will increase with rising electric rates.

Now it gets a little more complicated, because the PV system has a useful lifetime of Y years, whereas a bank CD or a stock portfolio only lose value at the rate of inflation, and never "wear out." But it's still a straightforward calculation:

From the X dollars per year that the PV system produces, you subtract the amount of money you'd need to save, in order to replace the system at the end of its useful life. What remains is your real, perpetual yield on the investment.

From the $2,500 (for a CD) or the $5,000 (for a stock portfolio) you take out only the amount of interest (or price rise and dividends) over inflation, so that the investment retains its real, inflation-adjusted value, and you have as above a real, perpetual yield.

You can then see which is more profitable: an investment in solar, or an investment in CDs or stocks. Of course, stocks are more profitable than CDs but carry a very real risk of a market crash. PVs carry a risk of damage from weather, but presumably you could buy insurance and include that in the calculation.

The only difference then is that CDs and stocks can be cashed out if you need cash, or if your financial plan is to spend down your savings over the course of your retirement. On the other hand, PVs increase the value of your home.

That's how I would analyse the purely financial aspect. Again, I'd do it anyway, for the cool factor, but for it to become mainstream, it's got to be more profitable than the investment alternatives.

Maybe a simpler way to analyse it would be: If you borrow the $50,000 as a home-improvement loan, over the life of the system, is X in the above analysis more or less than your yearly payments on the loan?

 

<div class='quotetop'>QUOTE(qbee42 @ May 2 2007, 09:39 AM) [snapback]433878[/snapback]</div>

Sounds like I need to move north where people seem to have more of a conscience.

 

<div class='quotetop'>QUOTE(daniel @ May 3 2007, 06:21 AM) [snapback]434658[/snapback]</div>

In CA, no entity can "not permit" PV installations for aesthetics alone.

$50k is the unsubsidized amount, and the subsidies are all over the map. This is the kind of thing that should be subsidized! And I can answer the question from my personal situation. Three years ago, the cost (to me, after subsidies) of my system was $11,000 (much smaller system than my dad's). I tacked that amount onto a refinance of my home. I'm paying about $70 to pay off the PV portion of that loan every month. For that $70, I'm buying what used to be a bit over $70 worth of electricity. When I pay off that loan soon, then my power is free. But since I was at parity from the moment I turned the system on, it has really cost me nothing. I'm just paying for PV power instead of grid power. When the loan is paid off, I'm not even paying for the PV power.

Oh, and I just checked. It is officially a 5.2KW AC system. $42,500 system cost. $31,500 after rebate. It was quoted last year. Today the price would be higher.

 

Oh, and I just checked. It is officially a 5.2KW AC system. $42,500 system cost. $31,500 after rebate. It was quoted last year. Today the price would be higher.
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This comment caught my eye. I was under the impression that these systems were rapidly *decreasing* in cost year over year. What's the bottom line??

 

<div class='quotetop'>QUOTE(daniel @ May 3 2007, 08:21 AM) [snapback]434658[/snapback]</div>

Uh oh, you've gotten Darrell and I talking solar! Its all over, now.

In Colorado, like California, it is against the law for HOAs to ban renewable energy projects on aesthetics alone. Now, they can put up quite a fight, and require certain types of installations (for instance, they can ban pole mount trackers, but they can't ban all PV). Some try to ban them anyway, and it can be a real hassle to fight them on it.

These guys might know about WA: http://www.solarwashington.org/

In colorado, we are fortunate that public opinion regarding renewable energy is very good. So HOAs are usually quite pleased to have us putting attractive solar systems on people's homes. It makes the neighborhood look more cutting edge and progressive. But in a few cases we've had to convince them, by designing very attractive systems.

About the 'finances' part, again, I'm fairly sure that if you ran all the numbers, you would find that PV with no subsidies is not more profitable than stocks or other financial investments. But then again, real estate is generally less profitable than stocks, but you still buy a home, because it is something you and your family need. We generally install systems that generate between 80 and 100% of the home's power usage, no more than 100%. You save more money by offseting your current bill than you do by selling power at the utilities net avoided cost rate (which can be as low as 3 cents per kWh).

Investment in PV is an investment in three things:

Finances - It does have a positive ROI, but it is a conservative investment. As power prices change (UP, not down), the ROI will get higher and higher. People will never NOT need electricity.
Your Home - PV and other renewable energy systems increase the value of a home. Data is still coming in on this, but preliminary numbers show that homes with significant energy saving upgrades sell for much higher than comparable homes without upgrades. Grid Tied PV systems are essentially maintenance free, so new owners aren't buying a 'headache', just the benefits.
The Environment - Your home and your automobiles do the most damage to the environment. PV systems pay back their environmental impact in less than two years, after which, that electricity is offsetting huge quantities of carbon release. PV systems last a long time, and can do a lot of good. PV, unlike generators, wind farms, and nearly any other type of power generation system, works just as good (or better, sometimes) when it is scattered out over a large area. Giant solar farms are not any more efficient than many little arrays on roofs, so a good roof installation isn't a compromise on effectiveness, it is a guaranteed source of power for your community for years to come.

If you want to do some calculations, here are some numbers you may want:

System Life: Modules carry a 25 year warranty. Inverters and the balance of systems (wiring, racks, misc stuff) carry a 10 year warranty. So a VERY conservative lifetime estimate would be 25 years, including one inverter replacement. Inverter replacement is somewhere around 60 cents per system watt, so around 3300$ for the system discussed above.

From my experience, and the data I've seen from visiting BP's accelerated aging labs make me believe that the modules will be producing power at nearly full capacity for at least 50 years (probably longer). Inverters will need changing, not so much because they will break (most have no moving parts at all), but to keep up with changing code requirements.

So you could use a 50 year lifespan, with 2 inverter replacements (6600$). If you really want to get picky, add 500$ labor every 10 years for someone to remove the modules for reroofing, if it is a comp. shingle roof.

Many PV lifetime studies have been using a conservative, but very achievable, lifetime value of 30 years, with one inverter replacement. I think my systems will outlast this, but it would be hard to make one die sooner than this, so it makes a good place to start.

In terms of power generation, it depends on your location. Washington, I'm gonna admit, does not have very good solar characteristics. But before you think that kills it for PV, remember that Germany has the solar characteristics of Alaska, and yet, installs more than 10 times the PV we do, and has been doing so for many years, and finding it a useful and valuable part of their energy strategy.

If we took Darrell's dad's house, and flew it to Spokane with a helicopter (man that would be expensive), then I simulate that it would generate about 6800kWh of electricity per year (in Cali, it is actually making him quite a bit more), or an average of 566kWh per month (actually much more in the summer, and much less in the winter). What does your power cost in Spokane? 8c/kWh? You can figure that out from your power bill. That means the system would be earning you about 550$ per year, which is only about 1% APR.

Of course, I'm not taking into account the increase in value of your home, federal tax credits, or state incentives, or changes in power price. Now lets assume that, fairly soon, Spokane goes to a reasonable time-of-use metering plan, and you pay 12c/kWh during the day, and 6c/kWh at night. Now your system is offsetting closer to 1600 per year. You can claim a 2000$ tax credit your first year, and lets say that, after 30 years, it has increased the sell price of your home by $20k. Now, over the 30 years you own it, it is returning an average of 2333$/year, for an equivalent APR of about 4.6%. Again, not stellar, but not too bad, either.

So anyway, there are a lot of ways to cook the numbers, but the other benefits are not to be understated. People aren't used to being part of the solution, instead of part of the problem, because there just aren't a lot of ways to DO that. Its always the lesser of two evils in our world. But the ability to be part of the solution, and at least not lose money doing it, is something that a lot of people are finding it worth doing. Even John Q. Public! We haven't convinced John "No Ethics Investor" Public, but they are getting less common as people gain a greater understanding of the global nature of their money, and what they are really supporting through their investment.

And just to run those numbers again, but for say, Colorado, with a good state incentive program (paid for by padding the electric bill, and justified because it prevents CO from having to build ANOTHER coal plant). The system would be 25,000$ after rebate, and it will generate over 8000kWh per year. Now we are at more than 9% APR over 30 years. Sounds pretty good, even on a purely financial level.

Anyway, hope I didn't drown you in numbers! It may be a while still before PV is more profitable than investing in cigarettes and the defense industry on wallstreet, but the fact that we are even comparing them is a good sign for PV, it means it is catching up fast.

peace,
Sam

 

Regarding finances, returns on CD's and stocks are taxable. So any return on a CD would be about one third less, due to taxes.

Returns that involve savings on electric or heating costs are not taxable, since the tax man knows nothing about them.

That's one reason why replacing a home heating system with a more efficient one is such a good investment. The savings are like dividends but are not taxable.

Harry

 

<div class='quotetop'>QUOTE(darelldd @ May 2 2007, 09:36 AM) [snapback]434018[/snapback]</div>

Darell,

It does look cool. Probably keeps the house cooler in the summer too.

I'm just curious, but about how much did that set of solar panels cost? I may be building a new place in a few years. We haven't decided yet.

Dave M.

 

<div class='quotetop'>QUOTE(Crtnt @ May 3 2007, 08:52 AM) [snapback]434768[/snapback]</div>

While the product cost has not changed significantly since last year, the local (meaning CA for me) rebates have gone down. The whole "million solar roofs" thing is killing us. Most people think it sounds wonderful - but the reality of it is bad news for the industry. At least for the residential retrofit industry.

<div class='quotetop'>QUOTE(Earthling @ May 3 2007, 12:16 PM) [snapback]434922[/snapback]</div>

True, and relevant! Just like in saving energy instead of simply producing more to cover consumption, saving money that isn't paid in taxable ways can be significant! Hmm. You said it better. I'll shut up.

<div class='quotetop'>QUOTE(dmckinstry @ May 3 2007, 12:20 PM) [snapback]434926[/snapback]</div>

Yes, having the panels protect the roof from direct solar radation can keep inside temps lower, and reduce cooling loads (though this home has no AC!).

Listed above in one of my posts, and quoted again in this one at the top. Please note that this system is TWICE the size of mine... and I charge my EV from mine, and still break even. The size you need depends on many things, so there is no average "system cost" to hang you hat on.

 

So true about choosing to dump the SUV. I went upside down when I dumped my loaded, and uber luxurious Acura MDX, and have never been happier! I will save more than enough in gas to make up the difference ($100/mo for the Prius vs. $320.00/mo for the Acura MDX).

 

Not sure! I haven't pumped any gas yet!!!

 

<div class='quotetop'>QUOTE(darelldd @ May 3 2007, 08:12 AM) [snapback]434740[/snapback]</div>

Thanks again to Sam for the financial breakdown, and to Earthling, for pointing out how taxes affect the equation.

I'm not at all sure how the law would affect my situation. This is not merely a HOA. It's technically a condo association: The homes are all three-house or four-house units, and the common roofs are all the property and the responsibility of the association. The best thing to do would be to convince the association (i.e. all my neighbors) to install PV throughout the entire community. But these are mostly conservative, flag-flying, people with ribbon stickers on their cars, living on fixed incomes, for whom a recent $7/month increase in association dues was a hardship that created a lot of complaints. Asking them to increase their mortgages for PV installation would be a hard sell.

If I lived in a separate individual house, I'd install PV just for the cool factor. But it's worth noting that my most recent electric bill was $28.88 for 490 kwh. That's $360 per year. Of course, if I had a PV system producing double that, I could divert some of my space heating to electric (it's natural gas now). And the Xebra will add a few kwh to my consumption. At this point, I have no idea if I will stay in this house, so I am less inclined to start a fight with my neighbors over a PV installation. I said in another thread that I'm a hypocrite. And this is it again: I believe in environmentalism, but not enough to create bad blood between me and my neighbors.

But if someone wants to come to Spokane and present a proposal, with numbers, to a generally conservative community of some 80 (?) houses, I could arrange the use of the clubhouse (every member has the right to reserve the clubhouse, on a first-come, first-served bases) and have a notice put in the monthly newsletter inviting people to come and listen. I doubt they'd go for it.

 

<div class='quotetop'>QUOTE(darelldd @ May 4 2007, 01:52 PM) [snapback]435659[/snapback]</div>

Thanks. I finally found the $9/W figure. I just skim too fast sometimes.

Dave M.

 

I never though about it too much, not there that often. Only comment is that station I use doesn't like you to top off and possibly spill gas. That's one thing I try to do because of bladder, try to get much in tank as possible, even though they may get cranky.