- #36
Pengwuino
Gold Member
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That still sounds way off and i can't follow the math at all.
hitssquad said:30 years of 5% interest/opportunity-cost for the above $5 million installed cost would be $17,406,143.44 for interest compounded daily or $16,609,711.88 for interest compounded yearly.
moneychimp.com/calculator/compound_interest_calculator.htm
Installed cost for the Nearing Institute system is $8,633. It provides 30 kwh of electricity per month. $8,633 divided by 30 = $287.77. I truncated that to $200 for a larger system that would probably benefit from economies of scale.Pengwuino said:That still sounds way off and i can't follow the math at all.
hitssquad said:Yet the world's leading homepower evangelism site says that it is impossible to make money with homepower.
http://www.homepower.com
Can you show us some numbers, Hypatia?
It is interest or opportunity cost at an arbitrary 5% discount rate. If you borrow it from a bank, it is interest. If you borrow it from yourself, it is opportunity cost.loseyourname said:When you say this calculation includes opportunity cost
I subtracted the cost of the system from the result provided at Moneychimp so the figures I provided are just the 5% interest out to 30 years. For a $500,000 system cost, Moneychimp says that compounded annually that would reap interest+principal of $2,160,971.19 after 30 years in an investment yielding 5% annual interest. Subtracting the $500,000 system cost from that leaves $1,660,971.19 of pure interest.loseyourname said:does that mean that this calculator tells you how much you actually pay for the system plus the money you could have made investing elsewhere?
It isn't considering any kind of investment in particular. The 5% interest is a somewhat arbitrary number that does not seems to me to be neither unrealistically high nor unrealistically low. 10-year T-bills as of yesterday were at 4.28%. I would assume that most people would spread their investments, though, riskwise, so that their portfolios would typically yield better than a T-bill would.If so, what kind of investment is it considering?
hitssquad said:Installed cost for the Nearing Institute system is $8,633. It provides 30 kwh of electricity per month. $8,633 divided by 30 = $287.77. I truncated that to $200 for a larger system that would probably benefit from economies of scale.
So, the rule of thumb for larger solar homepower systems is $200 per installed kwh-month.
No.Ivan Seeking said:Could you provide a specific quote and link to what you just said? Just linking to homepower doesn't help much.hitssquad said:the world's leading homepower evangelism site says that it is impossible to make money with homepower.
$287.77 was the upfront cost divided by the capacity of the system to produce energy per month. It was all paid up front.Pengwuino said:But you don't pay for the system every month. Its just $8000 right then and there upfront... not every month.
hitssquad said:$287.77 is the upfront cost divided by the monthly energy capacity of the system. It is all paid up front.
hitssquad said:Which financial aspects were ignored?
Larger homepower systems can make more energy in a given arbitrary month. Smaller homepower systems are limited to making less energy in a month. Larger systems cost more. I am figuring that for every kwh a system can make in a month, that system will cost $200 up front. Your house uses 2,500 kwh per month. A homepower system that could cover that would cost $200 * 2,500 kwh/month = $500,000.pengwuino said:So where is the $500,000 figure coming from.
Homepower systems cost money to install (figuring parts cost only here). You said it would cost upwards of $100,000 to install one adequate for your house. I said it would cost $500,000.Pengwuino said:Im just really confused on where this $500,000 figure is coming from.
Similar ratios of system cost to system size are available at the Homepower Magazine site. Find one that is lower than $200 per installed kwh-month and post it here, if you like. Your figure of $100,000 up-front cost works out to $40 per installed kwh-month. That is not so much lower that the $200 figure is in the twilight zone, is it?Pengwuino said:This can't be right... doesn't anyone else see this as absurd or did i slip into the twilight zone.
hitssquad said:It is interest or opportunity cost at an arbitrary 5% discount rate. If you borrow it from a bank, it is interest. If you borrow it from yourself, it is opportunity cost.
I very roughly guestimate that the breakeven would be somewhere around $1.00 per kwh.loseyourname said:At what point does the price of the local utility become so high that it is feasible to go solar instead?
hitssquad said:I very roughly guestimate that the breakeven would be somewhere around $1.00 per kwh.
This would only be for someone who refuses to invest in any energy saving technologies or techniques, though. The cost per kwh saved (also known in the homepower world as the cost per "negawatt") might be a lot cheaper for investing in energy-saving appliances such as front-loading washers or in energy-saving construction such as http://www.monolithic.com/pres/alt-energy/ .
Eureka! The best way to make money is to reduce our consumption in the first place.Pengwuino said:Its become more obvious that an investment in bonds or real estate is much smarter because whether or not you pay $50,000 for solar panels or you pay PG&E for electricity, you end up paying large amounts of money over time that you could probably invest with much better returns.
loseyourname said:The real question here should be: If I'm going to spend $500/month on electricity, am I better off paying that money to the local utility provider or paying that money to the bank that gives me a loan to buy and install solar panels. The latter seems the better option. Of course, that's an idealized situation in which you spend the same amount of money either way, when in reality I would imagine you pay less powering your home with electricity from the local provider. That seemed to be his initial question, though: At what point does the price of the local utility become so high that it is feasible to go solar instead?
Pengwuino meant square meters when he said square feet. Solar panels are rated by multiplying their efficiency at 20 degrees celsius by a standard solar insolation value of 1000 watts per square meter (the maximum that could be expected at the absolute optimum spot on Earth at the absolute optimum time; solar insolation is at best never more than a fraction of that at any point in the continental United States). 25% efficiency * 1000 w/sqm = 250 w/sqm. 10 square meters of 25% efficient panels gives us 2.5kw.pattylou said:We got our 2.5 kW system installed in February. It's much more than 10 square feet - I think more like 50 but I'd have to measure it and its outside.Pengwuino said:So i started calculating and based off this meter this one company has online that shows one of their residential 2.5kw generators (actually 2.5kw so it must be like 10 square feet of panels)
Which manufacturer is that, Pattylou?pattylou said:The manufacturer we used has reportedly improved the efficiency some
pattylou said:The manufacturer we used has reportedly improved the efficiency some, since, just in the few months since we've been generating. The ... crystals? cells? are now arrayed slightly differently to capture more energy.
pattylou said:Eureka! The best way to make money is to reduce our consumption in the first place.
pattylou said:A friend of ours is getting panels with a home equity loan. He will come out ahead the first year (by about a hundred dollars) and come out further and further ahead every year following - and over the life of the panels will save (if I recall) about 5000 dollars.
She said the manufacturer changed its formula after she purchased.Pengwuino said:Doesn't sound like you gained much.pattylou said:The manufacturer we used has reportedly improved the efficiency some, since, just in the few months since we've been generating. The ... crystals? cells? are now arrayed slightly differently to capture more energy.
Maybe you need a more efficient air conditioner instead, and better insulation on your home. Sometimes insulation is the best investment for cutting energy costs. What temperature are you aiming for? Lower than 76 with A/C? No wonder you're paying so much! I never set my thermostat lower than 78 in the summer. What's the point of living in a warm climate if you're going to refrigerate yourself?Pengwuino said:Pff, you come over here and live with 20 straight days of 103+ temperatures :P. See how much reduction you can handle. Our air-conditioner never even makes it to 76 degrees during the daytime and sometimes can't even get under the 80 degree mark till around 7pm
Moonbear said:What's the point of living in a warm climate if you're going to refrigerate yourself?
hitssquad said:She said the manufacturer changed its formula after she purchased.
Pengwuino said:Because i don't want to move and switch universities and leave all my friends to stay 2 degrees cooler :P