Loyd Case on installing solar panels
Over at Extreme Tech, Loyd Case has put together a wonderful little write-up about his experience installing solar powers on the roof of his Californian home... from talking to contractors to results. Even if you're not particularly green-friendly, the numbers certainly seem to make a lot of sense...
Our power usage is unusually high for a typical, four person nuclear family. A big part of that is because I have a PC lab and network in the basement. Both my wife and I work out of the house much of the time, with her time almost 100% in the home office. Plus, we have two teenage girls and a pretty beefy HDTV and home audio setup in the family room.The net result is annual power consumption in the Case house of 17,400kW hours. That will go down a bit—probably about 5–10% for each girl when our daughters head off to college (my oldest girl will be a high school senior next year.) We've also been fairly active in converting our lighting to compact fluorescent, though we still have a number of halogen sconces scattered throughout the house.
The solar power system would generate 8,721kW hours of energy per year. More importantly, it would generate that power during the peak hours of the day, when electricity from the grid is at its highest price. So our estimated annual power bill will drop from about $4,400 a year to less than $1,100 a year, with the average cost per kWH dropping from 25 cents to 6.3 cents.
The payback time, assuming energy costs don't spike steeply, is a little under nine years. If we sell the house, we should get it all back immediately.
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In every one of these calculations people always forget the cost of money, or the lost opportunity cost.
He claims a saving of $3,300 and around 9 years to payback, so he probably spent around $29,000 up front. That same money invested at 7% would have returned $2,080 per year, or he may have had to spend $2,080 per year to borrow the money.
That reduces his "saving" to ~$1,220 per year and is now around 24 years to payback the cost.
from the article: "The net cost after the California rebate, Federal tax credit, and the Sunpower rebate came in at around $36K (not counting permit fees.) We ended up picking this one—not just because it was the low bid, but because it was the most thorough."
Existing power load: "The net result is annual power consumption in the Case house of 17,400kW hours."
PV production: "So our estimated annual power bill will drop from about $4,400 a year to less than $1,100 a year, with the average cost per kWH dropping from 25 cents to 6.3 cents."
Ahh, Californians get so hosed on power costs. I pay about $.045 per kWh here in Ohio. No peak/off-peak rate changes. I keep wanting to do something with solar, but it just doesn't make sense, money-wise, yet.
I use very little power, though. My electric bill in the middle of the summer is about $50.
In my opinion it is entirely reasonable to ignore the opportunity cost in this situation.
Besides higher rated wind generators such as the Skystream, if your natural gas (i.e. methane) supply is significantly lower in cost than your electricity, you might do well to switch to microturbines for heat and electricity (i.e. cogeneration). Again, the initial outlay is about $10,000, but at least you don't have to worry about your neighbors complaining about the 35ft tall windmill you put up in your back yard. But then again, you still have to pay for your natural gas feed. (Although in a crisis it will run on any hydrocarbon source, such as gasoline or diesel.)
The last option, and this is still somewhat tentative/experimental, is hot dry rock geothermal energy, where advancements in oil drilling have yielded drills which can penetrate 2 miles below the surface to where it's hot enough anywhere, not just places like Iceland, to generate steam for power generation.
@#1: People also seem to forget changes in energy costs in these calculations too. When was the last time electricity prices fell in California?