Is now a good time to invest in solar?

[markjkirk]

PSEG launched a new loan program .. Solar Loan II .. here is an interview with the Program Lead, Andres Salas, at http://solarpanelreporter.com/public-utility-interviews/pseg-solar-loan-program-lead-andres-salas" where he gets into the specifics of what makes their program useful for private and commercial projects.

Also key is a link in that article that goes straight to their complete Solar Developer package. That has the present NJ SREC rates and shows what PSEG SREC rates are going to be in the coming years. - the link is in the article at SolarPanelReporter.com - above

What I like best was that they work through a homeowner solar panel project example and a medium sized commercial solar panel installation with (what looked like) fairly realistic costs and revenues.

They make a strong case for investing as early as possible. But then again, it is their own business interest to make those loans.

 

[Artman]

Yeah!

Threw the switch on Thursday the 21st! We are harvesting solar electric power now.

The state inspector took a good look at the project and was very impressed with the quality of materials and workmanship. He said our installers used top shelf equipment even where other installers frequently might skimp. Such as metal for backer boards instead of pressure treated wood, lightning arresters, and temperature sensors on the panels where they are not required, but make a better job.

So far we've had some cloudy weather, but on a couple of nice sunny days it has produced admirably at about 7200 watts at the inverter at almost 12 noon, about 81.8% of its 8800 watt rated capacity and so far about 27 kwh per day average.

 

[mheslep]

at almost 12 noon, about 81.8% of its 8800 watt rated capacity ...

That's 82% at noon on 21 January, a month from the Winter solstice. No doubt it will improve substantially later in the year.

 

[dlgoff]

Yeah!

Threw the switch on Thursday the 21st! We are harvesting solar electric power now.

The state inspector took a good look at the project and was very impressed with the quality of materials and workmanship. He said our installers used top shelf equipment even where other installers frequently might skimp. Such as metal for backer boards instead of pressure treated wood, lightning arresters, and temperature sensors on the panels where they are not required, but make a better job.

So far we've had some cloudy weather, but on a couple of nice sunny days it has produced admirably at about 7200 watts at the inverter at almost 12 noon, about 81.8% of its 8800 watt rated capacity and so far about 27 kwh per day average.

Outstanding. Keep the data coming.

 

[Artman]

That's 82% at noon on 21 January, a month from the Winter solstice. No doubt it will improve substantially later in the year.

Thought I would post the effect of snow on the ground in front of our ground mount solar array. The panels were clear of snow, there was a solid layer of 3"-4" of snow on the ground in front of them creating a nice reflective surface, and the sky was sunny, pretty much cloudless. The 8800 watt system produced 8200 watts (measured by the inverter) at 1:30. That's 93.2% efficient under those conditions. I wasn't able to check it at noon, but I'll bet it was nearly 100% because the system produced a total of 43 kwh during its operation that day. The snow seemed to help because the following day was equally sunny, but some of the snow had melted off the ground in front of the panels and they only produced a total 39 kwh (still, not bad for middle of winter). I think the wattage was around 7800 at 1:00 that next day.

 

[mheslep]

Thought I would post the effect of snow on the ground in front of our ground mount solar array. The panels were clear of snow, there was a solid layer of 3"-4" of snow on the ground in front of them creating a nice reflective surface, and the sky was sunny, pretty much cloudless. The 8800 watt system produced 8200 watts (measured by the inverter) at 1:30. That's 93.2% efficient under those conditions. I wasn't able to check it at noon, but I'll bet it was nearly 100% because the system produced a total of 43 kwh during its operation that day. The snow seemed to help because the following day was equally sunny, but some of the snow had melted off the ground in front of the panels and they only produced a total 39 kwh (still, not bad for middle of winter). I think the wattage was around 7800 at 1:00 that next day.

It might be interesting to hook up an instantaneous amp meter, ie a scope with a current probe. I read that the power can vary substantially second to second on partially cloudy days, or due to bird and aircraft overflights, and that fast variation at larger scales can be a problem for grid operators.

 

[mgb_phys]

(still, not bad for middle of winter).

The panels are more efficient when they are cold - not sure how much difference there is summer-winter but it all helps

 

[mheslep]

Just so
http://www.solarpower2day.net/images/9t.png

 

[Artman]

It might be interesting to hook up an instantaneous amp meter, ie a scope with a current probe. I read that the power can vary substantially second to second on partially cloudy days, or due to bird and aircraft overflights, and that fast variation at larger scales can be a problem for grid operators.

We're getting an instantaneous meter as part of the package. The installer is contracted to monitor through the internet to see if there is a problem and we can monitor also. Not sure if it can do trending, or if I just have to log in and check it out from time to time. They are supposed to put it in next week.

 

[dr dodge]

so, with install, solar panels and controls and gound construction, what the total cost?
sounds like its putting out some nice power
good job in doing what many only talk about

jr

 

[Artman]

The latest development is that the installer came to put in a real time monitor yesterday. It took a few hours for us, and a service tech, to discover that MAC filtering on my network was blocking the signal from reaching their server. Got it straightened out and now I can monitor my solar output from any computer with internet capability.

so, with install, solar panels and controls and gound construction, what the total cost?
sounds like its putting out some nice power
good job in doing what many only talk about

jr

Installed price $74,020
NJ Buy down rebate -$15,400
Subtotal $58,620

Permit fees $500
Subtotal $59,120

Federal Tax credit -$17,736
Total $41,384

Sounds like a lot left, but with an estimated savings from electricity production, SREC sales, the payback should be less than ten years, with near zero cash outlay to make the payments. Also, it's a nontaxable $74,000 increased value improvement to my property.

 

[russ_watters]

Taking a swag at your energy savings, if you get 43 kWh on a sunny winter day, you'll probably get more like 80 on a sunny summer day. Figure though a 60 average and 60% clearness, you get 13,140 kWh per year. What's your all-up energy cost? $.15 / kwh? At that, you save $1971 per year (can you sell excess back to the grid at the same price?). How much money will you get for SRECs?

 

[rewebster]

sounds great artman--I'd love to do the same


I wouldn't doubt that they'll be even more state and federal tax credits in the future, and it may even come to pass that putting solar panels up may be a requirement someday

 

[mheslep]

Yes the excess sales to the grid must be part of this plan, no? Otherwise it sounds like you have too much panel at ~8kW, $74k.

 

[Artman]

What's your all-up energy cost? $.15 / kwh? At that, you save $1971 per year (can you sell excess back to the grid at the same price?). How much money will you get for SRECs?

Average all-up cost is about $.15 to $.17/kwh.

We can sell excess of about 5%. We have a new digital net meter on the house, so far we haven't caught up to our night/cloudy day usage because of all the cloudy days, but I think we will if given a few clear days in a row.

We should get 11 or 12 SRECs a year they are currently selling for around $670 each. We may try and lock into a lower long term deal for a guaranteed rate of about $500 each for a contract period of several years, if we can find a buyer. I think the Life Cycle Cost analysis was based on only $460 per SREC for 10 year payback at 11 SRECs per year.

 

[Naty1]

great discussion...I looked into this about six months ago...and decided the payback looked like it would be too long...8 or 10 years...but a lot depends on assumptions and actual performance.

Good to see your electrical production is robust...when I looked into a few solar panels for use aboard my boat, perhaps six or eight years ago, the assumptions were ridicuously optimistic and the investment not even worth considering...at that time unicellular panels were the most efficient and most expensive...that's perhaps more important where space restrictions are really limited.

Glad to see solar now makes marginal sense, but not glad that my tax dollars are supporting application of an inefficient and uneconomical technology...

good luck with all your efforts!

 

[mheslep]

Average all-up cost is about $.15 to $.17/kwh...

What, that is the rate you sell energy to the utility, or your internal expected rate amortizing the $42k out of pocket?

 

[russ_watters]

That's the cost of buying a kWh from the electric company. He didn't say what he can sell them for...

 

[russ_watters]

We should get 11 or 12 SRECs a year they are currently selling for around $670 each. We may try and lock into a lower long term deal for a guaranteed rate of about $500 each for a contract period of several years, if we can find a buyer. I think the Life Cycle Cost analysis was based on only $460 per SREC for 10 year payback at 11 SRECs per year.

12*$670= $8040
$8040+$1971=$10,011
$41,384/$10,0011 = 4.1 years

If that's what it really works out to, 4.1 years is an excellent payback.

Gotto admit though, I really don't understand the logic behind SRECs. From the wiki, it sounds like the point is to have electric companies subsidize private solar production by paying them 4x what the power is worth just for producing the power (ie, not actually buying the power). That seems like bad economics to me, but they are a great deal for you.

 

[Artman]

Glad to see solar now makes marginal sense, but not glad that my tax dollars are supporting application of an inefficient and uneconomical technology...

Actually, each year it will reduce greenhouse gases equivalent to those generated running a car for 19,000 miles, the efficiency approaches 100% of rated capacity on a very sunny day, placing it well over many forms of power plant electrical production efficiencies And the panels will continue to create electricity from sunlight for the next 20-40 years with only some additional maintenance to the inverter.

As a use of stimulus money, it begins by putting the money in the hands of those who will use it, myself, my contractors, their employees, the local bank that financed the project, their employees, the solar component companies, and if enough people take advantage of the opportunity, it will prolong the time till there is a need for increased power utility infrastructure.

Or, you could give the stimulus money to wall street and see how much works it's way down to the people.

Russ, as far as I know, I can sell the excess kwh for what I buy it for in NJ up to 5% overproduction.

 

[dlgoff]

This got me curious as to how much you can sell electricity back to the utility company here in Kansas. Here's what I found:

House Bill 2844, passed in 2006, established net-metering rules for Kansas utilities. Net-metering is available for systems that generate 10kW or less. Net excess generation is credited to the customer’s next bill until the end of a 12-month billing cycle. After 12 months if you generate more than you use, you’ve just made a donation to your utility company (but it’s for a good cause since you’re using clean power). Reimbursement is however capped at 1% of the total number of kilowatt hours sold by the utility. This means that up to that 1%, customers are credited at the retail rate for the power they generate. Beyond the 1% cap, the utility reimburses customers at 150% of the wholesale rate.

http://www.solarpowerrocks.com/kansas/"

 

[russ_watters]

...the efficiency approaches 100% of rated capacity on a very sunny day, placing it well over many forms of power plant electrical production efficiencies

Not sure what you mean by that - all types of power plants can produce their rated capacity, that's why they call it "rated capacity".

And the panels will continue to create electricity from sunlight for the next 20-40 years with only some additional maintenance to the inverter.

Of course (assuming the panels don't degrade), but at what cost? These vast subsidies make it viable for an individual to do, but for the economy as a whole, it's a huge loser. It's one of those things that works only as long as almost no one takes advantage of it, akin to the idea that "if everyone got phd's, who would pick up trash?"

Russ, as far as I know, I can sell the excess kwh for what I buy it for in NJ up to 5% overproduction.

Just to clarify, you can sell it for the "all-up" cost of $.15-$.17? Or for the generation portion of the electrical cost (typically half to a third of the cost). Ie, a good fraction of an electric bill is paying for the maintenance of the distribution infrastructure. Since obviously you aren't building or maintaining any power lines, it wouldn't make sense to pay you to do that...though I could see lawmakers forcing the power company to pay the all-up price.

Also, I don't understand that 5% of production issue - I always thought the electric copmany was required to buy whatever you sold it. I guess that may be to prevent people from building plants just to get the subsidies, since most of the profit possibility is in the subsidies.

 

[mheslep]

...And the panels will continue to create electricity from sunlight for the next 20-40 years with only some additional maintenance to the inverter...

Is that from the panel manufacturer? Off the top of my head 20 years out I believe silicon PV panels degrade to something like 80% of rated.

Edit: yeah, 0.71% per year.
http://www.nrel.gov/docs/fy02osti/31455.pdf

 

[russ_watters]

FYI, here are the rates for southeastern PA:

VARIABLE DISTRIBUTION SERVICE CHARGE:
SUMMER MONTHS. (June through September)
5.20¢ per kWh for the first 500 kWh per dwelling unit (I)
5.96¢ per kWh for additional kWh. (I)
WINTER MONTHS. (October through May)
5.20¢ per kWh (I)
COMPETITIVE TRANSITION CHARGE:
SUMMER MONTHS. (June through September)
3.42¢ per kWh for the first 500 kWh per dwelling unit
3.97¢ per kWh for additional kWh.
WINTER MONTHS. (October through May)
3.42¢ per kWh
ENERGY AND CAPACITY CHARGE
SUMMER MONTHS. (June through September)
6.10¢ per kWh for the first 500 kWh per dwelling unit
6.81¢ per kWh for additional kWh.
WINTER MONTHS. (October through May)
6.10¢ per kWh

As you can see, the actual generation of the electricity costs about 1/3 of the $.15 per kwh all-up cost (in which I didn't include the sales tax).

 

[mheslep]

FYI, here are the rates for southeastern PA:

VARIABLE DISTRIBUTION SERVICE CHARGE:
SUMMER MONTHS. (June through September)
5.20¢ per kWh for the first 500 kWh per dwelling unit (I)
5.96¢ per kWh for additional kWh. (I)
WINTER MONTHS. (October through May)
5.20¢ per kWh (I)
COMPETITIVE TRANSITION CHARGE:
SUMMER MONTHS. (June through September)
3.42¢ per kWh for the first 500 kWh per dwelling unit
3.97¢ per kWh for additional kWh.
WINTER MONTHS. (October through May)
3.42¢ per kWh
ENERGY AND CAPACITY CHARGE
SUMMER MONTHS. (June through September)
6.10¢ per kWh for the first 500 kWh per dwelling unit
6.81¢ per kWh for additional kWh.
WINTER MONTHS. (October through May)
6.10¢ per kWh

As you can see, the actual generation of the electricity costs about 1/3 of the $.15 per kwh all-up cost (in which I didn't include the sales tax).

3.4¢ in the Winter. That's cheap, even before taxes. I though electricity was getting expensive in Pa.

 

[russ_watters]

3.4¢ in the Winter. That's cheap, even before taxes. I though electricity was getting expensive in Pa.

You misread: It's 5.2+3.42+6.10=14.72¢

There are three separate per kwh charges to every residential electric rate:
Distribution charge (upkeep on the grid)
Transition charge (other, basically)
Energy charge (the cost to actually generate the electricity)

 

[mheslep]

You misread: It's 5.4+3.42+6.10=14.92¢

There are three separate per kwh charges to every residential electric rate:
Distribution charge (upkeep on the grid)
Transition charge (other, basically)
Energy charge (the cost to actually generate the electricity)

ouch

 

[Artman]

I've been trying to find in writing what NJ's policy is on the subject of overproduction. What I am finding seems that the net metering (meter that rolls forward and back) allows a customer generating system to run the meter backward during production and forward during nighttime and days when the sunshine is outrun by the house usage, at full retail rates. The net difference can be carried from month to month, like "rollover minutes." I haven't been able to find if they are carried from year to year, but that may be the case. Any credit is in the form of just that, basically saving for a rainy day.

Net metering helps customers make the most of their renewable energy investments. It enables customers to obtain full retail credits on their utility bill for each kWh of electricity their renewable system produces, in excess of the amount of electricity used over the course of a year.

When a customer's renewable energy system produces more electricity than the customer actually uses, the customer will be compensated with credits at the full retail value of the electricity for the production over and above what they use.

http://www.njcleanenergy.com/renewable-energy/programs/net-metering-and-interconnection"

 

[Artman]

Not sure what you mean by that - all types of power plants can produce their rated capacity, that's why they call it "rated capacity".

There are efficiency losses due to the inverter that place the production on an average day at about 80% of the panel's rating. On a sunny day with snow on the ground in front of the panels for instance, the output of the inverter after efficiency loss might equal the panel nominal rating (220 watt panel might produce 225 or 230 watts).

Of course (assuming the panels don't degrade), but at what cost?

They do degrade. The process is destructive to the panels. We were told there are BP panels that have been in operation nearly 40 years.

These vast subsidies make it viable for an individual to do, but for the economy as a whole, it's a huge loser. It's one of those things that works only as long as almost no one takes advantage of it, akin to the idea that "if everyone got phd's, who would pick up trash?"

True enough, but there is little fear of that. These systems are not for everyone. They require a lot of space on the ground or a roof, the initial money outlay to install the system is high for an average homeowner. Fossil fuel subsidies way outrace solar incentives.

More than $54 billion of that was in the form of 23 different tax credits for oil, coal and natural gas producers, including those overseas, most of which are permanent provisions of the U.S. Tax Code. Just $18.3 billion was grants and other direct cash for research and development and other pursuits, such as the Strategic Petroleum Reserve.

Renewables such as wind, solar and hydropower received nearly $29 billion in all, much of it also in the form of tax credits although, in this case, credits that expire after set durations. And more than half of the renewable subsidy—$16.8 billion—went to the production of ethanol from corn, a controversial biofuel that can cut into food supplies and has significant environmental consequences, including greenhouse gas emissions and expanded dead zones from fertilizer runoff.

"The vast majority of federal subsidies for fossil fuels and renewable energy supported energy sources that emit high levels of greenhouse gases when used as fuel," the report's authors write. "These figures raise the pressing question of whether scarce government funds might be better allocated to move the United States toward a low-carbon economy."

http://www.scientificamerican.com/blog/post.cfm?id=how-much-in-subsidies-do-fossil-fue-2009-09-18"

 

[Naty1]

I concur with Russwatters comments above...

Actually, each year it will reduce greenhouse gases equivalent to those generated running a car for 19,000 miles, the efficiency approaches 100% of rated capacity on a very sunny day, placing it well over many forms of power plant electrical production efficiencies And the panels will continue to create electricity from sunlight for the next 20-40 years with only some additional maintenance to the inverter.

This is totally irrelevant as Russwatters has pointed out. If I have a system that is 100% efficient and costs a million dollars to produce a KWH, it's irrelevant how "efficient" it is. If you look up the efficiency of silicon solar cells, you'll find that are about 30-35% efficient...see the chart at http://en.wikipedia.org/wiki/Solar_cell#Solar_cell_efficiency_factors
.but this has nothing to do with economics.

No matter how you slice it investing about $8400 to produce a kwh of electricity part time (when there is sun) cannot in any way compete economically with a large power plant...and no one knows the environmental damage,if any, associated with the production of silicon based products...and all the other components of a solar system//////silicon is NOT lying around on the surface to be scooped up.

As a use of stimulus money, it begins by putting the money in the hands of those who will use it,

By this logic, we could also give $100 to every street alcoholic in the country...they,too, would "use it"...

I spent some years doing economic studies for projects at AT&T and I guarantee home solar power, on an economic basis, would have been laughed right out of consideration. The real issue here is that the tax money that goes to support this uneconomic investment. If everybody did this we'd go bankrupt...

Artman, my comments are an idictment on a policy and governmental level, not directed at you. I AM installing energy efficient windows and WILL be taking advantage of the 30% tax credit for those; so we all get wrapped up in bad government policies...