Northern Virginia System - $ vs envirommental impact

[J.P.M.]

To be more clear, my decision to go solar, if I do, is solely based on finances. Environmental reasons related to fossil fuels or global warming are not a consideration, for me. Maybe my $$ are better spent in equities or maybe the home solar is the better ROI for the next 15-20 years. If the Fed tax credit was not part of the equation I probably would not consider solar at all.

TJ

You're not that much different from the rest of us, save you're probably less hypocritical about it. It's all about saving money or at least the perception of saving money as public opinion can be manipulated.

I've come to the conclusion that when people do what is truly in their best long term financial interests, the environment is usually helped the most, that is, use less and change lifestyle a bit.

Unfortunately, most folks usually confuse short term gain and short sighted simplistic, non critical and simplistic thinking for long term critical and strategic thinking. So, they get sold a bill of goods that solar will save the planet, climb on the sheeple sola bandwagon and as a result, throw $$'s at self inflicted high electric bills by installing the most expensive way to reduce an electric bill (solar), and then, usually and more ironically, usually wind up using more electricity because the most effective impetus to reduce use (a higher electric bill) has been (perceived) to have been reduced to some degree.

[solarix]

I rest my case. Solar will not become mainstream until it is simply the cheapest option for creating electricity. Despite all the societal benefits, and despite what the Paula Mints of the industry say, the solar industry needs to continue to drive prices down until the TJ289's of the world will do the right thing for their own benefit. Of course by that time, it might be too late.

[tj289]

I rest my case. Solar will not become mainstream until it is simply the cheapest option for creating electricity. Despite all the societal benefits, and despite what the Paula Mints of the industry say, the solar industry needs to continue to drive prices down until the TJ289's of the world will do the right thing for their own benefit. Of course by that time, it might be too late.

I agree solarix on your first point, although not certain what the societal benefits you speak of. A solar system is not the cheapest but the tax benefit makes it worth while for me. It's Government choosing winners and losers by subsidizing one industry versus another. What is the subsidy on Electric Vehicles, 6,8 10K? Would they sell more than a few thousand if uncle sam not handing out huge tax credits, I doubt it......!

Having solar, I imagine, makes one feel a little more self sufficient or less dependent and that may play into the equation to a small degree. Like having your house paid for, sure you can make more in the market than the 4% interest rate one pays on their mortgage but having it paid for has a feeling that is difficult to quantify......JMHO.

TJ

[SunEagle]

I rest my case. Solar will not become mainstream until it is simply the cheapest option for creating electricity. Despite all the societal benefits, and despite what the Paula Mints of the industry say, the solar industry needs to continue to drive prices down until the TJ289's of the world will do the right thing for their own benefit. Of course by that time, it might be too late.

Too late for what?

If your first concern is environmental improvement and saving money is secondary I can give you the answer to what you want.

Stop using electricity and fossil fuel entirely. Period.

That will save you money and in a small way reduce the harmful affects that you feel your consumption is contributing to the overall global changes.

The right thing to do is to reduce usage and waste. Unfortunately I do not see that being a motivator for a lot of the Green people.

[herndonfam]

[QUOTE=sensij;162695]How are you calculating that rate of return? As I'm sure you are aware, many fixed income instruments will return your principal at the end of the term (absent a default), and equities can generally be sold to recover the capital. A PV system only saves you in the cost avoided for energy you would have bought from the power company.


I used the IRR function in excel. I put the initial cost as negative and the savings as the return.

I agree equities can be sold to recover capital. I believe the 11% return from the estimate include an increase in the value of the home - in effect the return of capital.

I agree that without the federal tax credit I would not consider solar.

[sensij]

[QUOTE=herndonfam;162928]

I used the IRR function in excel. I put the initial cost as negative and the savings as the return.

That function requires a cash flow. Over how many years are you projecting the savings? What is the probability you will live in the house that many years?

[herndonfam]

I used the projected energy savings as the cash flow. The first five years I will recieve a rebate on property taxes based on the value of the system so I added that to the cash flow.

The probabilty of living in the house for 25 years is probably 50%. I would like to think 100% chance of 10 - 15 years. However, this is the biggest unknown. I guess if we leave early the cost savings would be factored in the sales price.

[nevetsyad]

I agree solarix on your first point, although not certain what the societal benefits you speak of. A solar system is not the cheapest but the tax benefit makes it worth while for me. It's Government choosing winners and losers by subsidizing one industry versus another. What is the subsidy on Electric Vehicles, 6,8 10K? Would they sell more than a few thousand if uncle sam not handing out huge tax credits, I doubt it......!

Having solar, I imagine, makes one feel a little more self sufficient or less dependent and that may play into the equation to a small degree. Like having your house paid for, sure you can make more in the market than the 4% interest rate one pays on their mortgage but having it paid for has a feeling that is difficult to quantify......JMHO.

TJ

Next thing you know, the government is going to let people write off the interest on their home loans to encourage home sales. Give tax credits and tax breaks for daycare costs and having kids. Or, super crazy, give billions of dollars to US oil companies to help find new oil deposits in the US, then further subsidies to them, while they turn a net loss for the year. The government has been encouraging our decisions for decades, and picking winners and losers in business, just quietly and in the background.