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I am getting closer to pulling the trigger on solar. However, besides the environmental aspect, I am not quite sure it actually makes a lot of sense for us. We only pay about $0.14/kwh with a non-for-profit electric utility. So while the neighboring cities had huge increases in cost (now around $0.35/kWh), we have been mostly unaffected by this. Our increase over the last 7 years or so was only about 2-3% per year, less than inflation. At the same time, about half dozen quotes I got are between $2.5/W (mona lee, a terrible company) and $4.5/W with SunRun from Costco. The others are around $3.5/W. We are still on net metering 1 (getting closer to the 5% coverage of peak but who knows what will come after net metering 1). Considering net metering 1, we won't be installing batteries and therefore don't have the high cost of batteries. I did create a table to calculate where our pay-off would be assuming a 3% increase every year and get to about 14 years. That's not calculating maintenance (cleaning panels for about $300/year, labor for repair/replacement of parts, etc). So it's really a pretty long time. My wife argues, that it would be better to invest the money and let it grow rather than putting it into a solar system. While investment into indexes is a risk, over the long term (and solar is also long term) it mostly goes up by a significant amount (and we are disciplined enough to actually do invest money we have available). So my wife does have a good point that I think few people take into consideration. So what would you do in such a situation (cheap electricity available).
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I would not install solar in your case.
FYI, I have solar in my current house (new build, Jan 2020) and my prior house (solar installed 2017). Makes perfect sense in CA San Diego Gas and Electric (SDGE) provider.
But with your rates, 14 year break even ("payoff"), to me it would be silly to put in solar.
And with the change here in SDGE territory to NEM 3.0, I would not put in solar here now (ie if I didn't have solar).8.6 kWp roof (SE 7600 and 28 panels) -
I agree with Charlie does not make sense to install solar in your case.
You may ask why I installed solar and the only reason I did it was because the RECs I sold offset the price of materials and I was able to DIY the install.Comment
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I also struggle with the cost and ROI of installing Solar. Using the math on a 6kw system even if the final cost is $2/watt and if my electric rate goes to $0.12/kwh ( it is less then $0.10/kwh right now) it would still take me 12 plus years to get my money back. And at 70 year old I doubt I would live to 82 but anything is possible.Comment
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You have to ask yourself; "How long do I intend to live here?" If it's only a few years, then solar is not economically right for you.
We hit that decision gate a few years back right after I retired. We could either do a last, large round of upgrades to the house (including solar) or move. Looked at the economics and after 18 years, we were realized it was cheaper to invest a final push of upgrades than it would be to move and be "house poor" again. Moving would have brought a new mortgage plus upgrades to roof, HVAC, windows, siding, plumbing, electrical, renovations, etc. which we realized we would be having to deal with again if we moved to something within our budget and in a region were we wanted to live.
We opted to make our current home our "forever" home (at least one that will last us until we're in our 80's). Used part of my pension to renovate the house to our liking and install solar (bought the system outright). The upgrades have made our home more or less carbon neutral.
Rade Radosevich-Slay
Tiverton, RIComment
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Split the money you would need for PV (and forget leasing or a PPA agreement all together - those always were a rip-off and the darlings of the solar ignorant) and instead consider putting the funds toward conservation and use reduction efforts for some of it. Put the rest of the funds into a long-term bond mutual fund.
After 10-20 years you'll have a high probability of being further ahead financially than you would have been with PV alone, you'll have saved a substantial amount of electricity (and $$) and you'll still have the bond fund principal.
The way utilities are manipulating the game, PV is not as lucrative, or as sure of a timely financial payoff as it was, or as likely to be continued as a utility program at all as much as it was in the past.
Then too, there's also the situation of the way installers are pulling out of the business making future service on systems more of a challenge than it once was.
I'm happy with my PV and solar thermal systems but knowing what I think I might know about alternate energy, I'm pretty sure I wouldn't redo today what I did almost 14 years ago. The rules of the game have changed too much and there's too much uncertainty in the future of solar energy for my comfort level to be maintained.Comment
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You need to decide what your reason would be for going solar, there
are many. Some think it is about money, I am NOT interested in
leaving the absolute maximum $ to my heirs (like my parents did).
Could be about backup or off grid, only rarely works. Could be about
reducing your carbon footprint. Here I was using nat gas half a
century ago, monthly meter fee was $2. Every year I found ways to
reduce gas used, and every year my gas bill was bigger. Meter fee
went to $7, then $10, they were going to get my money no matter
what. Reading that wholesale gas prices had bottomed out, my bill
was higher than ever. After moving, they were going to run a gas line
past my house in 2013, metering fee could exceed $300 a year. I
went solar Net Metering, paid nothing for heat, AC, electric since.
Do not know if I will ever show a profit, could care less if it happens
in my lifetime. Bruce RoeComment
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Getting solar put on a house with good rates, good service and no blackouts, and NEM 3.0 or similar rate plans is an irrational financial decision.
That being said, I did just that. I just installed an 8 kW Outback Radian with 10 kW of panels and a 10 kWh battery pack and am wanting to get 10 kWh more battery and my utility rates are good, I have good service and no blackouts, and my rate plan was NEM 3.0 or similar rate plans, and I may even need to pay more for electricity usage in the summer when I now have a two tiered rate plan.Comment
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"does solar make sense?"..........probably not from a financial standpoint, unless you are lucky enough to obtain a good net metering subsidy. That being said a lot of rooftop and ground mount solar is installed for other than financial reasons. Back up power, environmental reasons, making the neighbors jealous, tinkerer mentality are just a few non-financial reasons.
What's yours?Comment
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It appears to me that it is finally sinking in to the lawmakers and regulators that net metering is an unsustainable business model for the utility industry. OK in the short run when utility and investor capital can absorb the subsidy cost but net metering has very bad unintended consequences in the long run.Comment
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For certain it's unstainable here in Illinois. Why on earth would they pay me for the distribution portion of my solar output? Zero chance I'll be out in a rainstorm or fair weather for that matter maintaining the power grid. But hey if they are going to give me one for one on the net metering plan I'll take it!!!Comment
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Mike, here are some real world numbers.....Hoosier Energy produced power at their Merom coal plant for ~2.9c per kWh. They sent that power onto the transmission lines for a cost of ~3.5c per kWh. That's right, transmission costs were higher than production. That power was purchased by both Indiana and Illinois REMCs for ~7.5c per kWh giving Hoosier a profit of ~1.1c per kWh to cover their overhead costs and to hold a little back as capital reserves.
The REMCs turned around and distributed that power to homes and businesses at ~10c per kWh. Its a nice little business model that works well even today. Now just think if the REMCs would have to purchase power at 10c vs 7.5c and not be able to recoup their distribution cost even if that power was going to the next door neighbor. If the net metering uptake is small then the past capital reserves could absorb the costs but if a large proportion of the customers signed up for net metering then someone would have to bear an increasing share of the fixed transmission and distribution costs and it would be the remaining dwindling consumers that are late to the subsidy bar.
It's just plain unsustainable and inequitable in the long run and that's why net metering is rare, if nonexistent, for REMCs on the Hoosier network.Comment
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Pretty much like every other government subsidized idea they come up with. I would definitely not choose to go solar under the contract terms offered by my POCO today. I reached ROI 3 years ago and will now enjoy the benefits of saving my money, paying cash and owning my own system.
Dave W. Gilbert AZ
6.63kW grid-tie ownerComment
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No comment on the government subside, it had no impact on my
decision to go solar. There are a lot of different plans under the NET
METERING plan, and I will only speak for mine, for 15kW AC solar
here in ILL. This works very well for me, eliminating my heating and
AC costs and emissions, electricity is a much smaller item. It is working
very well for the PoCo for several reasons. I am giving them power and
transmissin costs of several thousands of kWh every year. I am reducing
their transmission costs by helping level the load, putting out my peak
power just when all the AC units down the street are running, taking kWh
back at a lower demand time. I am definitely NOT costing them transmission
costs for my use, they SAVED all those costs when I was running neighborhood
AC. You can look around for some other background costs, but I was paying
them before solar with my connect fees, and I continue to pay them today.
The only problem the PoCo might have about my service, is that my use
was so low BEFORE solar. But nobody dares complain about that. That
is hardly changed now. Bruce RoeComment
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