Monday, January 16, 2012

Residential solar PV: a happy customer

Gail Overton
Senior Editor
Laser Focus World

There is nothing quite like opening your electric bill for the third month in a row and owing $0 (that’s a zero) dollars. This is the second winter season that our electric bill has been zero since we put in our 3.22 kilowatt solar photovoltaic (PV) system in the summer of 2010.

Now before I launch into a summary of panel output and cost (which are details often lacking in many articles that I read about residential solar energy systems), I'd like to describe a few unique issues that make our system especially cost effective. First of all, it is a ground-mount system--which made it less expensive to install compared to some rooftop systems. Secondly, we live in the desert southwest of California, with abundant sunshine and rarely a cloudy or rainy day, meaning that our solar output is maximized compared to many other locations in the world (and California gives generous rebates for residential systems). And third, we found a very efficient crew and an excellent installer in our area that helped us with rebate paperwork, interfaced with our utility company, and did the job over a 3 day period (including concrete footings and frame in a very rocky caliche soil). The name of that company by the way is "The Sun Works" ( out of Niland, CA.

Our system uses a total of 14 Sharp monocrystalline PV panels rated at 230 W each, bringing it to 3.22 kW and generating roughly 20 kWH (kilowatt hours; often written as KWH) each day. This means that we get roughly 7 hours of full generation out of our panels every day; pretty good considering they are fixed and do not track the sun (solar tracker equipment is fairly expensive).

With 20 KWH of generation per day, we output roughly 600 KWH per month, with the excess feeding into our grid-tied system. And because we typically consume about 300-600 KWH per month in the winter (depending on whether the heater is running or not), our bill is basically zero in the months between November and April. Our monthly consumption in the summer months--when it’s up to 110 degrees outside and the air conditioning is set at 80 degrees inside--is about 1200-1800 KWH, meaning that our highest bill of $230 per month is roughly cut in half. Utility rates at Imperial Irrigation District (IID) are some of the lowest in the country at $0.13/KWH, meaning a month with 600 KWH consumption runs about $80 a month.

So what was the price and what is the "payback" time for our system? The total price was $22,600. Sounds overwhelming and unaffordable for most people, but here is the bottom line: Immediately upon installation, one-third of that price is rebated against the total. The state of California pays the installer about $7500, bringing the amount we owed to $15,100. And then, another one-third of the total price becomes a full tax writeoff, taking the price down to $7600. But reality is harsh; because that tax benefit is not available until later, we financed the $15,100 through our Credit Union, which offers 6.75% fixed rate, 5-year solar loans. Essentially, we think of our solar-energy system as the equivalent of a five-year car payment. Fortunately, unlike a car that is sometimes worthless after five years (or worth just a couple thousand bucks), our solar energy system should continue cranking out the kilowatts for a 25-year lifetime, giving us 20 full years of zero dollar electric bills in the winter, and $100 maximum electric bills in the summer. Each year, we save about $1200 with the system, making it a 6.3 year breakeven point at a total price of $7600.

While making that payment now is not fun, I’ll be smiling broadly in just three more years when the loan is paid and the kilowatts continue to flow for years to come.

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