Is it worth to go solar?

[hpdad]

Thinking of go solar so the last few days I have been reading in this forum. A lot of good info. However, it seems people go solar they paid more for the electricity. My case is different.

I live in South California. My house was built in 1998, 1900 sqt, 2-story. Below is what I paid for electricity (SCE) last year:

Jan 13: $90 - 520 kWh

Feb: I lost the bill

Mar: $52 - 380 kWh

Apr: $47 - 350 kWh

May: $78 - 498 kWh

Jun: $73 - 534 kWh

July: $271 - 1273 kWh

Aug: $133 - 776 kWh

Sep: $148 - 846 kWh

Oct: $66 - 479 kWh

Nov: $52 - 380 kWh

Dec: $52 - 485 kWh

Jan 14: $52 - 376 kWh

Feb: $53 - 384 kWh

As you can see, only the months of July, Aug, and Sep, the bill were over of $100 because I used AC. If I go solar, is it worth it? What are the good options? Purchase, pre-paid lease, .....

Much appreciate.

[prhamilton]

I would wait. A majority of your usage is in Tier 1(~0.13 per kWh). You are going to have a hard time installing a small solar system for under $0.10 per kWh. So the savings is going to be minimal, for now...

In the next couple of years there is going to be a change in the rate structure in California(a so called flattening). What this will mean is that tier 1 pricing will probably rise to $0.16-$0.18 and upper tiers will reduce. At the same time prices of solar panels will probably continue to fall and you see a situation where there might be enough savings for you to install solar. These changes are all as a result of legislation AB327 signed by Governor Brown in Oct 2013. Google AB327 and you read more about it if you are interested.

I would check back in 2015, by then we will know the new rate structure for CA. The federal tax credit is set to expire in 2016 so that might be the window of opportunity...

[J.P.M.]

Thinking of go solar so the last few days I have been reading in this forum. A lot of good info. However, it seems people go solar they paid more for the electricity. My case is different.

I live in South California. My house was built in 1998, 1900 sqt, 2-story. Below is what I paid for electricity (SCE) last year:

Jan 13: $90
Feb: I lost the bill
Mar: $52
Apr: $47
May:78
Jun: $73
July: $271
Aug: $133
Sep: $148
Oct: $66
Nov: $52
Dec: $52
Jan 14: $52
Feb: $53

As you can see, only the months of July, Aug, and Sep, the bill were over of $100 because I used AC. If I go solar, is it worth it? What are the good options? Purchase, pre-paid lease, .....

Much appreciate.

You're probably using about 6000-7000 kWhrs./yr., most of that in tier I & 2 and little use /$$'s in tier 3 & 4 save for July/Aug. Sept. Solar electric is probably not cost effective for your situation. FWIW, if all of us used electricity like you do, there would be no solar business in CA. and I bet electricity costs would be lower. So, to answer your question, IMO no, it ain't worth it from a cost effective standpoint for you. Your best option is to keep doing what you are doing and MAYBE think about a solar water heater. Nicely done. We should all be so frugal.

[hpdad]

Wow, didn't expect getting the replies so fast. Thanks.

I know a bit about bill AB327. Read it from here too..

Guess I have to wait see what will happen next year.

Now I know why every time the solar company people came to my house and asked the first question was: Did you pay $150/month or more for electricity?

[hpdad]

Based on number above for a whole year: 7041 kw and paid $1152. So average out is $0.164 per kw.

There are few questions I like to ask:

1. Does solar system saves the energy from less used month for the peak month use in summer?

2. What average charge of of kw for prepaid lease/PPA in S.Cali (I live in Inland Empire area)? And purchasing?

[prhamilton]

Net metering is what lets you save power in the winter and use it in the summer and can help keep you out of the higher tiers/rates.

With a purchase or prepaid lease you can typically expect to see prices in $0.07-$0.10/kWh range depending on the system size and roof.

I didn't look too much at PPA but what I did seem to range from $0.15-$0.20/kWh and included a rate escalator.

[hpdad]

prhamilton,

If prepaid lease charged $0.07-$0.10/kWh. Yearly, I used probably 7000-7500 kWh. Therefore, the cost would be about $700 - $750/year (assumed $0.10/kWh). The saving probably $450 - $480/year or ~$40/month. Is my math right? If that, I would be happy to switch to solar

[prhamilton]

Sure but your break even point is probably 10 or 12 years out. For me I'd like to see a break even point inside of 7 years. If you are sitting on the cash and don't feel you could invest it at better than say 6% then it might make sense. You are really right on the edge of what makes sense financially and with the changes coming I think it makes sense to wait and see what changes are coming.

If you want to install solar to increase the amount of renewable energy and want to make a small difference in climate change that could tip the balance towards doing it.

It can't hurt to get a couple of quotes and see what you come up with. I am pretty sure that PPA will not make sense for you, break even at best. I would talk with at least one local installer and get a couple online quotes from some of the bigger companies, I can give you the names of a few if you aren't familiar but google knows them too.

[slopoke]

prhamilton,

If prepaid lease charged $0.07-$0.10/kWh. Yearly, I used probably 7000-7500 kWh. Therefore, the cost would be about $700 - $750/year (assumed $0.10/kWh). The saving probably $450 - $480/year or ~$40/month. Is my math right? If that, I would be happy to switch to solar

I have to echo what JPM stated in a previous post. I don't think solar is the way to go for you, because at your usage you are probably in the first two tiers price wise. The ones who benefit the most and the system pays for itself in a relatively short time are those of us going into tiers 3 and 4. I expect to save around $2500.00 per year with our system and it will pay itself off in just under 7 years. Our anticipated monthly electricity bill should average $25.00 +/- a few dollars.

[hpdad]

Sure but your break even point is probably 10 or 12 years out. For me I'd like to see a break even point inside of 7 years. If you are sitting on the cash and don't feel you could invest it at better than say 6% then it might make sense. You are really right on the edge of what makes sense financially and with the changes coming I think it makes sense to wait and see what changes are coming.

If you want to install solar to increase the amount of renewable energy and want to make a small difference in climate change that could tip the balance towards doing it.

It can't hurt to get a couple of quotes and see what you come up with. I am pretty sure that PPA will not make sense for you, break even at best. I would talk with at least one local installer and get a couple online quotes from some of the bigger companies, I can give you the names of a few if you aren't familiar but google knows them too.

Thanks guys,

I took your advice and not going with solar for now. Though, I still am wanting to have question

The number on my previous post was based on prepaid lease and I thought I don't put any money down for this option. And this option is looking forward to save money every month, not about break even.

Sorry if it sounds dumb. Just want to understand clearly.

[prhamilton]

With a prepaid lease you don't make any monthly payments and instead make a single lump sum payment at the start of the lease(often 10% below the purchase price).

A standard lease would have no up front payment but a 20 year payment schedule like a loan.

A PPA would have you purchase a set amount of power each month for a set price(often escalating 2.9% per year).

[hpdad]

With a prepaid lease you don't make any monthly payments and instead make a single lump sum payment at the start of the lease(often 10% below the purchase price).

A standard lease would have no up front payment but a 20 year payment schedule like a loan.

A PPA would have you purchase a set amount of power each month for a set price(often escalating 2.9% per year).

Before I thought the prepaid is payment monthly. Darn, that's what prepaid meant. I feel dumb now.

Didn't know there was standard loan. Don't have to pay up front. I guess the down side is higher charge.

I am much clearer now.

Thanks.

[J.P.M.]

prhamilton,

If prepaid lease charged $0.07-$0.10/kWh. Yearly, I used probably 7000-7500 kWh. Therefore, the cost would be about $700 - $750/year (assumed $0.10/kWh). The saving probably $450 - $480/year or ~$40/month. Is my math right? If that, I would be happy to switch to solar

At $.07 to $.10/ kW even I'd have trouble arguing w/ a prepaid lease. I'm not sure that's correct. In the Inland Empire, prepaid leases seem to be at slightly more than tier one pricing - ~~ $.13-$.16/kWhr. and some contracts w/ escalation are still around for the uninformed.

[EZ Generator Swit]

Your Return on anything

We are building & electrical contractors so we see many different scenarios every day. Many people just way it out by years and cost but I think there is more to it
*The longer you wait the more the solar will cost...pretty much a fact. *How much do you want it and is there a price associated with personal desire *I think a bigger question is how long do you intend on staying where you are at?
* If you move sooner than expected will you get your $$ back out of it * Does it increase the value of your home as much as it cost? Just a couple of other things to ponder over!

[Ian S]

At $.07 to $.10/ kW even I'd have trouble arguing w/ a prepaid lease. I'm not sure that's correct. In the Inland Empire, prepaid leases seem to be at slightly more than tier one pricing - ~~ $.13-$.16/kWhr. and some contracts w/ escalation are still around for the uninformed.

How does escalation work on a prepaid lease?