Monday, June 16, 2014

Actual savings: Solar power

Just a little while ago, I was filling out a survey on how likely I would be to consider solar power for my home. In order to give an informed answer to the question, I did a quick search on "solar payback time," and I found this article from a site called Clean Technica, which claims to be "the #1 cleantech-focused website in the world." It leads off with the claim that "there are people who apparently know nothing about it but decide it’s their duty to tell people the energy payback of solar panels is a decade or more (which it is not!)." It then goes on to display a bunch of charts showing that the payback period for rooftop solar systems is "between 1/2 a year and 1 1/2 years in Southern Europe and under 3 years in the rest of Europe (which has approximately the solar irradiance levels of Alaska)."

Now, that sounded a bit odd to me, because I definitely remembered talking to a solar installer a few years back about whether a solar system would be a good deal for us, and they concluded that, based on our site and our relatively low energy use, solar panels on our house would not be able to pay for themselves. I don't mean that they would have a long payback time—I mean they would not produce enough power over their entire lifetime to pay for the cost of installing them. Yet here were these folks at Clean Technica insisting that the payback period was no longer than three years. Was this big discrepancy simply due to the much heavier subsidies for home solar systems in Europe? Or did it mean that the cost of solar power had dropped so much in the past few years that a solar system, formerly a bad deal for us, was now a good one?

Finding the answer to this question turned out to be more work than I expected. Searches on "calculate home solar power potential," "is solar a good investment for me," and "how much solar power can my house produce" all led to dead ends. Some of the links were sites that wanted my contact information in order to give me a quote on a solar system; others provided general information about how to figure out what size your solar system should be; but none could actually give me concrete information on how much a solar system would cost me and how much it would save me. Finally, I managed to find this "solar estimator" from a company called Brightergy, which finds your actual house on a map and lets you outline the exact spot where you want to put solar panels. It took a bit of fiddling to get the tool to work, but eventually I managed to sketch out a roughly appropriate area for a 2-kW system. The site crunched the numbers and told me this would cost about $7,300 to install, of which we would get back 30 percent in tax credits, giving us a net cost of about $5,110. The energy it produced would reduce our power bills by 84 percent, or $463 per year. Thus, the system would pay for itself in...11 years, which last time I checked was in fact "a decade or more."

To double-check my figures, I used this "system sizing estimator" on the site of a different solar power company, Affordable Solar. It has one very handy feature that the other site lacks: a map showing how many "sun hours" different parts of the country get in an average day. The northernmost parts of the country get around 3 hours of sunlight; the Southwestern desert gets 6 hours or more. Here in New Jersey, we get around 3.5 hours, which means that to meet 100 percent of our home electricity needs, we'd have to install a 2.55-kW system. Affordable Solar claims that such a system would add more than $10,000 to the value of our home, but they don't say how much it would actually cost to install. However, Michael Bluejay's solar energy calculator indicates that a typical cost is around $4 per watt, making the total cost $10,200, or $7,140 after the tax credit. Divide that by an annual power bill of $540, and the payback time is just over 13 years. (According to Bluejay, this figure isn't quite right, because I need to adjust my electric bill for inflation over time. He recommends multiplying it by 1.5 to compensate. If his calculations are correct, then my payback time is actually just under 9 years. However, in reality, energy prices don't just rise at a steady rate with inflation; they're extremely volatile and hard to predict. So all we can really say is that my payback time is somewhere between 9 and 13 years—probably.)

Bluejay notes that for most people, "The calculator probably won't show a huge savings from solar." However, he maintains that it's still a good investment, since "for about the same amount of money or a bit less, you can get your energy from a clean source." Which is a perfectly valid point. So really, there's no need for the folks at Clean Technica to get so huffy about people claiming that solar panels will take a decade to pay for themselves; even if it's true (and for me, at least, it is), that doesn't mean it's not worth doing.
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