Evaluate Proposal on Installation of Solar Panels
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Evaluate Proposal on Installation of Solar Panels
Folks,
I would like to present a proposal I have received to have solar panels installed on the roof of my house. I live in Texas. I am still in the process of determining requirements. Could you all evaluate the contractors estimate below for accuracy.
1. Home in Texas.
2. System Size k- 6,750 W-DC
3. 27 Sunpower 250W Acpv Solar Modules, with 27 SunPower Micro Inverters
4. Total cost - 28,688 less Utility Rebate of $9,809=$18,878, also Federal tax Credit of $5,663-$7,650 depending on Accountants recommendation.
This could result in an effective adjusted total of $13,215-$10,272
5. Estimated Payback or breakeven 7 years.
6. Internal Rate of Return (IRR) 13.8%
7. Assumptions above based on 4.3% utility rate inflation, and 35.0% marginal tax rate.(so projected tax savings may be a little high)
8. 25 year warranty on Sunpower Solar Module and SunPower Micro Inverters
Below is some additional data:
1. Savings over 30 years $56,795
2. Contractor Solar Energy Price (30y Avg) 3.29 c/kWh
3. Avoided Utility Energy Price (30y Avg) 21.63 c/kWh
4. 30y Net Present Value (5%) $19,120
5. Some Performance Estimates for the first year :
A. 24,465 kWh consumed
B. 10,800 kWh solar production
C. 312,524 kWh Lifetime Solar Production
D. $1,188 Year 1 Energy Savings
E. $67,067 Lifetime Energy Savings
F. 44% Energy Needs Met by Solar
G. Current Monthly Bill- $224 electric bill, projected bill with solar panels $125
Thanks in advance
I would like to present a proposal I have received to have solar panels installed on the roof of my house. I live in Texas. I am still in the process of determining requirements. Could you all evaluate the contractors estimate below for accuracy.
1. Home in Texas.
2. System Size k- 6,750 W-DC
3. 27 Sunpower 250W Acpv Solar Modules, with 27 SunPower Micro Inverters
4. Total cost - 28,688 less Utility Rebate of $9,809=$18,878, also Federal tax Credit of $5,663-$7,650 depending on Accountants recommendation.
This could result in an effective adjusted total of $13,215-$10,272
5. Estimated Payback or breakeven 7 years.
6. Internal Rate of Return (IRR) 13.8%
7. Assumptions above based on 4.3% utility rate inflation, and 35.0% marginal tax rate.(so projected tax savings may be a little high)
8. 25 year warranty on Sunpower Solar Module and SunPower Micro Inverters
Below is some additional data:
1. Savings over 30 years $56,795
2. Contractor Solar Energy Price (30y Avg) 3.29 c/kWh
3. Avoided Utility Energy Price (30y Avg) 21.63 c/kWh
4. 30y Net Present Value (5%) $19,120
5. Some Performance Estimates for the first year :
A. 24,465 kWh consumed
B. 10,800 kWh solar production
C. 312,524 kWh Lifetime Solar Production
D. $1,188 Year 1 Energy Savings
E. $67,067 Lifetime Energy Savings
F. 44% Energy Needs Met by Solar
G. Current Monthly Bill- $224 electric bill, projected bill with solar panels $125
Thanks in advance
Re: Evaluate Proposal on Installation of Solar Panels
$28,688 is too much.mucho dinero wrote: 3. 27 Sunpower 250W Acpv Solar Modules, with 27 SunPower Micro Inverters
4. Total cost - 28,688 less Utility Rebate of $9,809=$18,878, also Federal tax Credit of $5,663-$7,650 depending on Accountants recommendation.
This could result in an effective adjusted total of $13,215-$10,272
Consider that you can get a 7000W system for $12,667 here in CA, before installation.
http://king-solarman.com/shop-by-solar- ... ystem.html
Sure, this doesn't installation or shipping to TX. However, it doesn't cost $15k in labor to install this system.
IMO, if you skip Sunpower, you can get a system that will have a top line cost under $20k.
Re: Evaluate Proposal on Installation of Solar Panels
The assumption of 4.3% linear utility rate increases makes the numbers look good. That may happen, may not. Linear projections are interesting but life rarely works that way. I would view those numbers with skepticism.
Regardless, at the end of the day your net cost is $1.52 per watt in the higher fed. tax credit scenario and about $2 a watt in the lower. Those are excellent prices for Sunpower panels with micro-inverters. Sunpower has an excellent reputation in the field and usually affords a premium. I think this is a very attractive proposal even though I do not have confidence in the IRR and other speculative economic analysis. If your breakeven turns out to be 10 or even 12 years, you still have more than a decade of energy left from them.
Regardless, at the end of the day your net cost is $1.52 per watt in the higher fed. tax credit scenario and about $2 a watt in the lower. Those are excellent prices for Sunpower panels with micro-inverters. Sunpower has an excellent reputation in the field and usually affords a premium. I think this is a very attractive proposal even though I do not have confidence in the IRR and other speculative economic analysis. If your breakeven turns out to be 10 or even 12 years, you still have more than a decade of energy left from them.
I own the next hot stock- VTSAX
- DiscoBunny1979
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Re: Evaluate Proposal on Installation of Solar Panels
For me it is as much about saving money over time as it is to not give a penny more than I have to to the Utility company. Therefore, I believe it's in my best interest, to max out my roof. For instance, the Utility Commission here in CA says that one can only build a system that is as powerful as last years' consumption. So, with the OP suggesting that the solar panels will only cover less than 50% of the electric bill (if I'm interpreting correctly), then what is the point of having solar if the entire bill isn't covered? Has the OP maxed out his roof space with the proposed system size? If not, the OP might want to consider a larger system. So, the OP needs to ask the question as to whether the proposed system can be added on to, and if, by how much or by how many panels. The OP also has to consider insurance ramifications of owning. Here in CA it has been suggested that whether leasing or buying, one should include the panels on their homeowners policy. Therefore, such small increase in insurance should be taken into consideration as it is an added 'cost'.mucho dinero wrote:G. Current Monthly Bill- $224 electric bill, projected bill with solar panels $125
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Re: Evaluate Proposal on Installation of Solar Panels
OP lives in Texas which has relatively high electricity prices (but lower than California) and a climate that pushes consumption up (air conditioning! yet it also manages to be cold in winter).DiscoBunny1979 wrote:For me it is as much about saving money over time as it is to not give a penny more than I have to to the Utility company. Therefore, I believe it's in my best interest, to max out my roof. For instance, the Utility Commission here in CA says that one can only build a system that is as powerful as last years' consumption. So, with the OP suggesting that the solar panels will only cover less than 50% of the electric bill (if I'm interpreting correctly), then what is the point of having solar if the entire bill isn't covered? Has the OP maxed out his roof space with the proposed system size? If not, the OP might want to consider a larger system. So, the OP needs to ask the question as to whether the proposed system can be added on to, and if, by how much or by how many panels. The OP also has to consider insurance ramifications of owning. Here in CA it has been suggested that whether leasing or buying, one should include the panels on their homeowners policy. Therefore, such small increase in insurance should be taken into consideration as it is an added 'cost'.mucho dinero wrote:G. Current Monthly Bill- $224 electric bill, projected bill with solar panels $125
It looks like a big array, 6.75 peak kw. I realize Texan homes are bigger than in Europe so it may not cover the whole roof.
The main problem seems to be the cost of the system for installation. That looks high compared to other benchmarks.
Re: Evaluate Proposal on Installation of Solar Panels
What other benchmarks?
Where are people getting Sunpower panels, inverter and install for less than net $1.60 watt?
Where are people getting Sunpower panels, inverter and install for less than net $1.60 watt?
I own the next hot stock- VTSAX
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Re: Evaluate Proposal on Installation of Solar Panels
I was simply looking at the other comments in the thread-- quoting significantly lower prices. I don't live in the US so any experience I have on costs is not likely to be relevant.WhyNotUs wrote:What other benchmarks?
Where are people getting Sunpower panels, inverter and install for less than net $1.60 watt?
Re: Evaluate Proposal on Installation of Solar Panels
The price before subsidies is $4.25 per watt - it is only the subsidies that make it $1.60 per watt.WhyNotUs wrote:What other benchmarks?
Where are people getting Sunpower panels, inverter and install for less than net $1.60 watt?
By foregoing Sunpower, one could get an unsubsidized cost of under $3/watt, and thus the subsidized cost would be about $1.13/watt - thereby saving the cost about 1/3 of the cost of his installation, and lowering the projected payback period by 1/3. I have yet to hear a good reason why one should use such expensive panels vs cheaper panels.
- DiscoBunny1979
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Re: Evaluate Proposal on Installation of Solar Panels
Valuethinker wrote:OP lives in Texas which has relatively high electricity prices (but lower than California) and a climate that pushes consumption up (air conditioning! yet it also manages to be cold in winter).DiscoBunny1979 wrote:For me it is as much about saving money over time as it is to not give a penny more than I have to to the Utility company. Therefore, I believe it's in my best interest, to max out my roof. For instance, the Utility Commission here in CA says that one can only build a system that is as powerful as last years' consumption. So, with the OP suggesting that the solar panels will only cover less than 50% of the electric bill (if I'm interpreting correctly), then what is the point of having solar if the entire bill isn't covered? Has the OP maxed out his roof space with the proposed system size? If not, the OP might want to consider a larger system. So, the OP needs to ask the question as to whether the proposed system can be added on to, and if, by how much or by how many panels. The OP also has to consider insurance ramifications of owning. Here in CA it has been suggested that whether leasing or buying, one should include the panels on their homeowners policy. Therefore, such small increase in insurance should be taken into consideration as it is an added 'cost'.mucho dinero wrote:G. Current Monthly Bill- $224 electric bill, projected bill with solar panels $125
It looks like a big array, 6.75 peak kw. I realize Texan homes are bigger than in Europe so it may not cover the whole roof.
The main problem seems to be the cost of the system for installation. That looks high compared to other benchmarks.
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My Proposed system is for 11.20 kw(DC) with 40 panels at a cost of @ $42,000 that is projected to cover slightly more than 100% of our electricity usage. Is that good? Well, a lease through a major company was going to charge $183 a month or $183 x 12 x 20 years or $43,920 (for a 41 panel system). With the rebate, buying the panels is a better deal as the loan through a credit union is for 12 years @ 2.9% with an option to pay down the loan 1 time within the first year with reamoritization and after, no prepayment penalty for prepaying any amount.
In my fuzzy math, my $42,000 for 40 panels = an average cost of $1,050 per panel. The OP stated that his sytsem size of 6,750 w-DC was for 27 panels for a total cost of $28,688 = an average cost of $1,101.40 per panel. The main difference is that I will have 1 or 2 inverters while the OP will have 27 micro inverters. So when it might be difficult to compare apples to apples, but the price per panel doesn't seem to be any different than my quote.
I do not calculate the potential rebate into a lower cost per kwh because I could 1) not have it installed in time and miss out on it, 2) use the money not to pay down a loan, but to buy something else, 3) the cost is a fixed cost regardless who pays or what rebate is received. You are paying that cost and therefore a rebate doesn't lower the cost per kwh just because Uncle Sam gives out some money. The solar company still received the entire amount. That's the cost per kwh.
FYI - my average Edison bill has been running about $350. $350 x 12 = $4,200 per year. $4,200 x 10 years = $42,000. I'd rather have panels on my roof than pay Edison over the next 10 years and have nothing to show for it. Pay Edison $42,000 over 10 years or buy panels for $42,000. I don't like this term, but it seems like a no brainer decision.
The OP has a suggested average bill of $224, so if we use a 10 year cost . . . that would be $224 x 12 x 10 or $26,800. A system anywhere in that ball park should be a good bet . . no? (or course take into consideration the OP's micro inverters versus my single inverter).
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Re: Evaluate Proposal on Installation of Solar Panels
As a comparison I just got a bid for an 8 kw system for 27k which is about 17k$ with tax rebate. Payback period is about 4 years. My monthly electricity bill is almost $400/month.
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Re: Evaluate Proposal on Installation of Solar Panels
Do you have any shading issues on your roof, even partially ?DiscoBunny1979 wrote:[
My Proposed system is for 11.20 kw(DC) with 40 panels at a cost of @ $42,000 that is projected to cover slightly more than 100% of our electricity usage. Is that good? Well, a lease through a major company was going to charge $183 a month or $183 x 12 x 20 years or $43,920 (for a 41 panel system). With the rebate, buying the panels is a better deal as the loan through a credit union is for 12 years @ 2.9% with an option to pay down the loan 1 time within the first year with reamoritization and after, no prepayment penalty for prepaying any amount.
In my fuzzy math, my $42,000 for 40 panels = an average cost of $1,050 per panel. The OP stated that his sytsem size of 6,750 w-DC was for 27 panels for a total cost of $28,688 = an average cost of $1,101.40 per panel. The main difference is that I will have 1 or 2 inverters while the OP will have 27 micro inverters. So when it might be difficult to compare apples to apples, but the price per panel doesn't seem to be any different than my quote.
If so, the micro inverters would be a much better bet. Even if just a few panels are completely dark during some of the day, when they are connected in series, as they usually are with a string inverter, this could bring down your solar production to almost zero during those times. That is the reason for having micro inverters.
Another reason is that micro inverters last longer than string inverters, even if you have no shading issues. IMO, the cost difference is well worth it.
As to your price, $42,000 for 11,200W is $3.75/watt. IMO, you can do a lot better - closer to $3 per watt.
The system I quoted earlier is $1.80/watt in parts, and this is with micro-inverters.
See http://king-solarman.com/shop-by-solar- ... ystem.html
If you assume $1.20/watt for installation, you end up with $3/watt .
But consider that on an 11,200W system, $1.20/watt for labor would be $13,440 in labor costs - IMO, quite high.
It simply will not cost the installer anywhere near that . Even if you assume 3 guys working 5 days for 8 hours/day, that's 120 hours of work.
$13440/120 is $112/hour for labor. You do the math. It's likely possible to find a solar contractor to work on a labor basis to install such a system for $7k - $8k - and still leave them with a very healthy profit. $8k would be $0.71/per watt for labor - plus $1.80/watt in parts. Total $2.5/watt.
Much less than your $3.75/watt quote. And you would get better micro-inverters, too.
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Re: Evaluate Proposal on Installation of Solar Panels
We should note here that Madbrain lives in Silicon Valley, which must be one of the most expensive labor markets in the USA-- even (especially?) for construction contractors.madbrain wrote:
But consider that on an 11,200W system, $1.20/watt for labor would be $13,440 in labor costs - IMO, quite high.
It simply will not cost the installer anywhere near that . Even if you assume 3 guys working 5 days for 8 hours/day, that's 120 hours of work.
$13440/120 is $112/hour for labor. You do the math. It's likely possible to find a solar contractor to work on a labor basis to install such a system for $7k - $8k - and still leave them with a very healthy profit. $8k would be $0.71/per watt for labor - plus $1.80/watt in parts. Total $2.5/watt.
Much less than your $3.75/watt quote. And you would get better micro-inverters, too.
Because even a leaf can fall on a panel, everything I have read suggests going for micro inverters.
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Re: Evaluate Proposal on Installation of Solar Panels
I was presented choices between monocrystalline and polycrystalline panels and micro inverters vs single phase inverters that I was told act just like micro inverters. The cost difference ended up being $3/w versus $3.2/w.
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Re: Evaluate Proposal on Installation of Solar Panels
Folks,
I am still in the data gathering phase and the contractors rep will be coming by to visit me next Friday. So I am working on some of the things that you have all brought up before talking further with this agent.
Will get back to you all around next weekend. Thanks for the tips that you have all provided to me so far.
I am still in the data gathering phase and the contractors rep will be coming by to visit me next Friday. So I am working on some of the things that you have all brought up before talking further with this agent.
Will get back to you all around next weekend. Thanks for the tips that you have all provided to me so far.
Re: Evaluate Proposal on Installation of Solar Panels
Mono vs Poly matters more over the long run - the mono are supposed to be more durable.travellight wrote:I was presented choices between monocrystalline and polycrystalline panels and micro inverters vs single phase inverters that I was told act just like micro inverters. The cost difference ended up being $3/w versus $3.2/w.
I have 28 mono 235W Sharp panels on my roof, and 12 poly 245W Talesun panels. It's too early to tell any difference in longevity.
The mono panels are supposed to perform better than poly, also, in theory. On my roof, they do not. I think that is due to orientation. The poly panels are positioned on a flat roof area, whereas the mono are tilted. The former position is more favorable.
In the end, the production between both types of panels is very comparable.
You may not see the difference for decades between poly and mono - when panels start to degrade. So, IMO, don't pay too much extra for mono.
On the other hand, paying more for micro inverters is justified - generally better solar production, especially if there are shading issues, and less likely replacement of inverters over time.
IMO, on a 6-7kw system, should be able to get get $3/watt with poly + micro-inverters. Part price is $1.80/watt. See my earlier posts in this thread.
- TimeRunner
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Re: Evaluate Proposal on Installation of Solar Panels
I'm wondering, don't so many micro-inverters mean more potential points of failure? And wouldn't one have to go on the roof, unbolt the panel, etc, if the micro-inverter fails? Seems like the electronics, baking in the heat of the roof every sunny day, would be more prone to failure. You could have, for example, 12, 18, or 24 of those to deal with over a couple of decades. And how do you know which one is not working?
I get the advantages, I just don't see much discussion of the downsides, which seem intuitively significant.
I get the advantages, I just don't see much discussion of the downsides, which seem intuitively significant.
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Re: Evaluate Proposal on Installation of Solar Panels
Yes, but if one fails, your whole PV system isn't down, unlike when your single inverter fails.TimeRunner wrote:I'm wondering, don't so many micro-inverters mean more potential points of failure?
You could choose not to replace/repair one micro-inverter and lose a portion of your solar production - no such option with a single inverter.
Yes, you would have to do that.And wouldn't one have to go on the roof, unbolt the panel, etc, if the micro-inverter fails?
And in theory, they would be more prone to failure - in reality, not so much. I have had some failures of micro inverters, but they were partial and intermittent - about 6 out of 28 would go offline a few minutes a day. This was within the first 3 years of my system's operation and may have been a manufacturing defect. When I reported it, Enphase replaced all my D380s with M215s at their expense, including labor.Seems like the electronics, baking in the heat of the roof every sunny day, would be more prone to failure. You could have, for example, 12, 18, or 24 of those to deal with over a couple of decades.
Apparently the D380s were there least reliable series and originally had 10 year warranty.
The new M215 have a 25-year warranty, so Enphase must be quite confident about them. I have had no issues with the M215s.
I have 28 M215s on my roof, and 14 M190s. All of them operating fine.
I think the biggest issue would be when it fails 1-2 decades later, to find the compatible part if just one or two fails.
In the case of the D380 which I purchased in 2010, in 2013, Enphase was not producing any more of them and no longer had any warranty replacements to send due to the higher than anticipated failure rate. This is why they chose to replace everything with the new generation M215.
The installer builds a map of every panel & micro-inverter at installation time. You can look at that map and see which panel is dark on the Enlighten web site. The map is what it looks like on the roof. Even without the map, or if the map is wrong, each micro-inverter also has a serial number, and you always have the list of all your micro-inverters, including any that may have failed, so it's always possible to find the one.And how do you know which one is not working?
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Re: Evaluate Proposal on Installation of Solar Panels
any thoughts on power optimizers as an alternative to micro inverters? If they achieve the same result at a lower cost?.....
"How do power optimizers work?
Like microinverters, power optimizers are located at each panel, usually integrated into the panels themselves. However, instead of converting the DC electricity to AC electricity then and there, they instead ‘condition’ the DC electricity before sending it to a central inverter. This approach results in higher overall efficiency levels than with a conventional string inverter.
Similar to microinverters, the main advantages of power optimizers are mitigation of partial panel shading impacts and panel-level monitoring. However, solar systems that use optimizers are on the whole more affordable than those that use microinverters."
"How do power optimizers work?
Like microinverters, power optimizers are located at each panel, usually integrated into the panels themselves. However, instead of converting the DC electricity to AC electricity then and there, they instead ‘condition’ the DC electricity before sending it to a central inverter. This approach results in higher overall efficiency levels than with a conventional string inverter.
Similar to microinverters, the main advantages of power optimizers are mitigation of partial panel shading impacts and panel-level monitoring. However, solar systems that use optimizers are on the whole more affordable than those that use microinverters."
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Re: Evaluate Proposal on Installation of Solar Panels
here is more info on the types of inverters, I am leaning towards power optimizers over microinverters, don't think I will consider string inverters:
https://www.energysage.com/solar/101/st ... optimizers
https://www.energysage.com/solar/101/st ... optimizers
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Re: Evaluate Proposal on Installation of Solar Panels
I see Costco now has a 5170 watt system for $12999. (ready to install). Not bad at all.
http://www.costco.com/Grape-Solar-5170- ... 30267.html
http://www.costco.com/Grape-Solar-5170- ... 30267.html
Re: Evaluate Proposal on Installation of Solar Panels
It's about 40% overpriced. For $12,667, you can get a 7kW system with micro-inverters.hicabob wrote:I see Costco now has a 5170 watt system for $12999. (ready to install). Not bad at all.
http://www.costco.com/Grape-Solar-5170- ... 30267.html
http://king-solarman.com/shop-by-solar- ... ystem.html
- just frank
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Re: Evaluate Proposal on Installation of Solar Panels
The financial assumptions are bogus.
I get the 7 year 'simple payback' number, but calling that a 13% rate of return in misleading. It is not the same as a risk-free bond with a 13% rate, because the array is a depreciating asset that is illiquid...you never get the 'principal' back at the end of the investment. I.e. say you think the lifetime is 2x the simple payback, and then the array is scrapped. You make back your sunk cost, and then the same amount again, but your true rate of return is then about half of that 13%.
What is the lifetime? Microinverters will not last 30 years in service, and there will be a labor cost to replace them in numbers on the roof. Hard to factor in, as its relatively new tech.
How old is the roof? I thought rooves in Texas didn't last that long...if your roof starts to leak, the array adds a bunch to roof replacement cost. If you have a newer or metal roof, you're good.
Say the array and roof hold together for 20 years, 3x your simple return period, your rate of return (with depreciation) is now maybe 8-9%. When you compute this, I agree the 4% increase in elec costs is crazy...I would assume the cost of elec would be flat or fall in real terms, not increase 2+% per year (real).
Still sounds pretty good for a risk-free investment, right? What are the risks? The biggest risk is that solar becomes popular. The value of your solar kWh in 2015 is very high as it comes during peak demand time on the Texas grid. The costs to the utility are almost nil, your excess runs your neighbor's AC without loading the grid equipment significantly, and your neighbor is paying the utility full retail price for the kWh you provided them. In this environment, the utility saves on buying peak kWh (more expensive than retail), and pays you retail in your net-meter agreement.
In 10 years however, if **everyone** has a PV array, then the situation can flip to having excess PV production during the day, and the value of those solar kWh will be a lot less. At some point in this scenario, your utility would switch to time of use rates that value your generation lower per kWh than the kWh it sells you at night. This will reduce your return by a potentially significant amount.
I am actually bullish on solar PV, but think you projecting your current financial situation forward 30+ years is nuts. Solar keeps getting cheaper, more people jump in (at lower costs than you), and exponential growth ensues...installed PV grows about 40% per year in good markets. How many years until peak solar production wipes out the peak in demand? Its happening in HI and CA **now**. Sunny Texas could easily get there in 7 years or less.
Bottom line, if you make your money back and then some in less than 10 years, you won't **lose** money on solar, but you should not plan on netting $60k over the next 30+years.
I get the 7 year 'simple payback' number, but calling that a 13% rate of return in misleading. It is not the same as a risk-free bond with a 13% rate, because the array is a depreciating asset that is illiquid...you never get the 'principal' back at the end of the investment. I.e. say you think the lifetime is 2x the simple payback, and then the array is scrapped. You make back your sunk cost, and then the same amount again, but your true rate of return is then about half of that 13%.
What is the lifetime? Microinverters will not last 30 years in service, and there will be a labor cost to replace them in numbers on the roof. Hard to factor in, as its relatively new tech.
How old is the roof? I thought rooves in Texas didn't last that long...if your roof starts to leak, the array adds a bunch to roof replacement cost. If you have a newer or metal roof, you're good.
Say the array and roof hold together for 20 years, 3x your simple return period, your rate of return (with depreciation) is now maybe 8-9%. When you compute this, I agree the 4% increase in elec costs is crazy...I would assume the cost of elec would be flat or fall in real terms, not increase 2+% per year (real).
Still sounds pretty good for a risk-free investment, right? What are the risks? The biggest risk is that solar becomes popular. The value of your solar kWh in 2015 is very high as it comes during peak demand time on the Texas grid. The costs to the utility are almost nil, your excess runs your neighbor's AC without loading the grid equipment significantly, and your neighbor is paying the utility full retail price for the kWh you provided them. In this environment, the utility saves on buying peak kWh (more expensive than retail), and pays you retail in your net-meter agreement.
In 10 years however, if **everyone** has a PV array, then the situation can flip to having excess PV production during the day, and the value of those solar kWh will be a lot less. At some point in this scenario, your utility would switch to time of use rates that value your generation lower per kWh than the kWh it sells you at night. This will reduce your return by a potentially significant amount.
I am actually bullish on solar PV, but think you projecting your current financial situation forward 30+ years is nuts. Solar keeps getting cheaper, more people jump in (at lower costs than you), and exponential growth ensues...installed PV grows about 40% per year in good markets. How many years until peak solar production wipes out the peak in demand? Its happening in HI and CA **now**. Sunny Texas could easily get there in 7 years or less.
Bottom line, if you make your money back and then some in less than 10 years, you won't **lose** money on solar, but you should not plan on netting $60k over the next 30+years.
Re: Evaluate Proposal on Installation of Solar Panels
I believe this has already happened in Germany.just frank wrote: At some point in this scenario, your utility would switch to time of use rates that value your generation lower per kWh than the kWh it sells you at night. This will reduce your return by a potentially significant amount.
However, one can install batteries for power-shifting. Ie. charge the batteries during the day from the solar PV, and discharge them at night.
One doesn't even need a solar PV system power shifting, actually.
Tesla Powerwall is one such system. I expect battery prices to drop. The utilities aren't going to win this war, IMO.
I also don't think we will ever get to the point where "everyone" has a solar PV. For one thing, the solar incentives do not currently work out for renters, only for homeowners. That already excludes about 35% of the population in the US. For another, a lot of people live in condos/apartments, and, even if they own them, don't have their own roof to install solar PV. This is especially true in large cities.
Still, we could conceivably get to the point where maybe 30% of households have solar PV. This would be a good thing, IMO.
But obviously, the business and billing model for large utilities will have to change somewhat.
- just frank
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Re: Evaluate Proposal on Installation of Solar Panels
Oh, I'm a believer that we will get to point that the majority of our civilization's energy usage will come from solar, and that it could happen in my lifetime. I also agree that various grid batteries will be put to work as the PV penetration exceeds some set level.
BUT, for the OPs specific question, I don't think the financial analysis done in 2015 will hold up 20 or 30 years from now. He could buy batteries in the future (at an unknown future price), but that is not part of the current decision/analysis.
BUT, for the OPs specific question, I don't think the financial analysis done in 2015 will hold up 20 or 30 years from now. He could buy batteries in the future (at an unknown future price), but that is not part of the current decision/analysis.
Re: Evaluate Proposal on Installation of Solar Panels
As others have said, this is a good price for Sunpower panels. You pay a premium for these panels. If you have limited roof space, you can get more out of them. I went for them because if I get as much as possible out of my roof for the first 10 years, I make up the difference thanks to Massachusetts SRECs (energy credits).
What is the "Utility Rebate of $9,809"? That looks like a really nice incentive. Is this something that is going to expire soon?
What is the "Utility Rebate of $9,809"? That looks like a really nice incentive. Is this something that is going to expire soon?
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Re: Evaluate Proposal on Installation of Solar Panels
Folks,
On Sep 17 I will be once again discussing an update of proposal on solar panels with the contractor. I would like to thank all of you for the comments you have provided me so far. I especially appreciate those povided by Disco bunny on homeowners insurance, Madbrain on numerous issues, hicab on Cotsco products, why not and just frank on being skeptical of tje contractors assumptions, and ccf on general good deal of proposal.
Also my wife had made the following comment, in that I am 68 and she is 76 would we really realize the full benefits projected by the contractor?
Performance Estimate
consumption 24,465
solar production 10,800
elec met by solar 44.10%
custom solar design
system size 6,750
annual production 10,800
solar modules 27
micro inverters 27
Stats
yr 1 energy savings 1,188
lifetime energy savings $67,067
Solar Options
cost of Doing Nothing
energy price (30y Avg) 21.6c/kWh
monthly utility bill $224
yr 1 tax credit $0
increased home value 0 0
lifetime costs $158,724
Benefit of Going Solar
energy price (30y Avg) 3.3c/kWh 3.3c/kWh
monthly utility bill $125
yr 1 tax credit $8,606
payback period 7 years
increased home value $17,733 $19,950
lifetime savings $56,795
ITC on Net
Cash Purchase
total cost $28,688
utility rebate -$9,809
Out of Pocket Cost $18,878
Federal Tax Credits -5,663
Adjustd Total $13,215
ITC rosson G
Cash Purchase
total cost $28,688
utility rebate -$9,809
Out of Pocket Cost $18,878
Federal Tax Credits -$8,606
Adjustd Total $10,272
Financial Benefits
Savings Over 30 years $56,795
30tr NPV(5%) $19,120
Payback 7 years
IRR 13.80%
Freedom Solar Energy
Price (30y avg) 3.29 c/kWh
Avoided Utility Energy
Price (30y avg) 21.63 c/kwh
Energy Savings
monthly savings $102
yearly savings $1,220
savings over 10 yrs $14,322
savings over 25 yrs $49,770
What do all of you feel about this proposal. I know to be sceptical about the contractors forcasts, but what do you all think about the current plan?
Thanks in advance
On Sep 17 I will be once again discussing an update of proposal on solar panels with the contractor. I would like to thank all of you for the comments you have provided me so far. I especially appreciate those povided by Disco bunny on homeowners insurance, Madbrain on numerous issues, hicab on Cotsco products, why not and just frank on being skeptical of tje contractors assumptions, and ccf on general good deal of proposal.
Also my wife had made the following comment, in that I am 68 and she is 76 would we really realize the full benefits projected by the contractor?
Performance Estimate
consumption 24,465
solar production 10,800
elec met by solar 44.10%
custom solar design
system size 6,750
annual production 10,800
solar modules 27
micro inverters 27
Stats
yr 1 energy savings 1,188
lifetime energy savings $67,067
Solar Options
cost of Doing Nothing
energy price (30y Avg) 21.6c/kWh
monthly utility bill $224
yr 1 tax credit $0
increased home value 0 0
lifetime costs $158,724
Benefit of Going Solar
energy price (30y Avg) 3.3c/kWh 3.3c/kWh
monthly utility bill $125
yr 1 tax credit $8,606
payback period 7 years
increased home value $17,733 $19,950
lifetime savings $56,795
ITC on Net
Cash Purchase
total cost $28,688
utility rebate -$9,809
Out of Pocket Cost $18,878
Federal Tax Credits -5,663
Adjustd Total $13,215
ITC rosson G
Cash Purchase
total cost $28,688
utility rebate -$9,809
Out of Pocket Cost $18,878
Federal Tax Credits -$8,606
Adjustd Total $10,272
Financial Benefits
Savings Over 30 years $56,795
30tr NPV(5%) $19,120
Payback 7 years
IRR 13.80%
Freedom Solar Energy
Price (30y avg) 3.29 c/kWh
Avoided Utility Energy
Price (30y avg) 21.63 c/kwh
Energy Savings
monthly savings $102
yearly savings $1,220
savings over 10 yrs $14,322
savings over 25 yrs $49,770
What do all of you feel about this proposal. I know to be sceptical about the contractors forcasts, but what do you all think about the current plan?
Thanks in advance
Re: Evaluate Proposal on Installation of Solar Panels
Looks like you are at $1.95 a watt now net. That is about where the market is at and a little below market for Sunpower installed. Seems like a sound deal for solar at this point in time. None of us can know what the future or electric rates or renewables will be.
If you compare it to something like buying a car, it is a no-brainer.
If you compare it to putting $$$ in money market or cd at this time, it looks good.
FWIW, after a few months of back and forth, we just put in an order for 5 kW more solar. I have had the experience of buying solar at four points on the falling price spectrum. I expect that the next pressure will be on panel efficiency and soft costs as solar continues to grow. Our house is 100% solar and we have an electric car. I am expecting to enjoy the financial benefits during our retirement. At the same time, it is possible that we will end up moving and I am comfortable with that risk.
If you compare it to something like buying a car, it is a no-brainer.
If you compare it to putting $$$ in money market or cd at this time, it looks good.
FWIW, after a few months of back and forth, we just put in an order for 5 kW more solar. I have had the experience of buying solar at four points on the falling price spectrum. I expect that the next pressure will be on panel efficiency and soft costs as solar continues to grow. Our house is 100% solar and we have an electric car. I am expecting to enjoy the financial benefits during our retirement. At the same time, it is possible that we will end up moving and I am comfortable with that risk.
I own the next hot stock- VTSAX
Re: Evaluate Proposal on Installation of Solar Panels
A review of local building permits in Eastern Connecticut shows roughly $2500/kw. That's the hottest item these days, 3 yrs ago it was generators and transfer switches. How many of those are getting used? I know, piece of mind.
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Re: Evaluate Proposal on Installation of Solar Panels
Although solar panels are great for conspicuous conservation, there are probably less noticeable ways to cut down electric bills that would have a faster return on investment. For example, it might be worthwhile to run the numbers on a geothermal HVAC system.
- just frank
- Posts: 1933
- Joined: Sun Nov 02, 2014 3:13 pm
- Location: Philly Metro
Re: Evaluate Proposal on Installation of Solar Panels
I'm gonna disagree. Outside of the northernmost US states and Canada, it is very hard to make a financial case for geothermal heating, versus, say much cheaper high-efficiency air-source heat pump equipment. The OP is in Texas, not Minnesota.YttriumNitrate wrote:Although solar panels are great for conspicuous conservation, there are probably less noticeable ways to cut down electric bills that would have a faster return on investment. For example, it might be worthwhile to run the numbers on a geothermal HVAC system.
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Re: Evaluate Proposal on Installation of Solar Panels
Your gross costs are similar to a 6.6 kW system that I had installed with micro-inverters 2 years ago.
I too think Sunpower panels are over-priced. I went with LG 300w panels and Enphase microinverters. The LG panels are now available in 315w. The higher efficiency increases output during the winter.
From what I've researched, it's really a toss up between micro inverters and power optimizers. Make sure you use a reputable installer who has been around for a while, so they will be able to provide the warranty service, which is 10-25 years depending on the component.
Also make sure you understand the various rate plans available from your local utility. We use time of use rates, which has allowed us to wipe out our electric bill even though we are a net consumer of kWh (consumption>production).
Not sure if I truly believe the studies on home value increases. Our break even was 7-8 years assuming no increases in utility rates, but we did not have as attractive a local rebate as you do. With that large of a local rebate, I'd definitely go for it.
I too think Sunpower panels are over-priced. I went with LG 300w panels and Enphase microinverters. The LG panels are now available in 315w. The higher efficiency increases output during the winter.
From what I've researched, it's really a toss up between micro inverters and power optimizers. Make sure you use a reputable installer who has been around for a while, so they will be able to provide the warranty service, which is 10-25 years depending on the component.
Also make sure you understand the various rate plans available from your local utility. We use time of use rates, which has allowed us to wipe out our electric bill even though we are a net consumer of kWh (consumption>production).
Not sure if I truly believe the studies on home value increases. Our break even was 7-8 years assuming no increases in utility rates, but we did not have as attractive a local rebate as you do. With that large of a local rebate, I'd definitely go for it.
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Re: Evaluate Proposal on Installation of Solar Panels
We have microwave inverters and a 10 or 12 panel system, I can't remember. Except when a household members was mining bytcoins, we have only paid the nominal $18/mo cost of being connected to the grid. H was around 70 and I in mid-50s when we installed. We figure it increases the value of our home for resale, eliminates the electric bill and can be removed as desired for about $500. We got both state and fed energy rebates for 65% refund. We feel it was money well spent.
We got 3 quotes and tried to get them all to quote one of the same panel with the same # of panels so we could compare them side by side. We only got quotes from companies others had recommended to us.
We got 3 quotes and tried to get them all to quote one of the same panel with the same # of panels so we could compare them side by side. We only got quotes from companies others had recommended to us.
- unclescrooge
- Posts: 6264
- Joined: Thu Jun 07, 2012 7:00 pm
Re: Evaluate Proposal on Installation of Solar Panels
$4.25/watt is on the high side. You should be able to do a little better.
Also check out solarpaneltalk.com.
I got Enphase micro inverters with 25 year warranties. I doubt the company would offer that long of a warranty if they didn't last that long.
Also check out solarpaneltalk.com.
I got Enphase micro inverters with 25 year warranties. I doubt the company would offer that long of a warranty if they didn't last that long.
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Re: Evaluate Proposal on Installation of Solar Panels
Yes, so a big chunk of the electric bill is going to come from cooling, not heating.just frank wrote:I'm gonna disagree. Outside of the northernmost US states and Canada, it is very hard to make a financial case for geothermal heating, versus, say much cheaper high-efficiency air-source heat pump equipment. The OP is in Texas, not Minnesota.YttriumNitrate wrote:Although solar panels are great for conspicuous conservation, there are probably less noticeable ways to cut down electric bills that would have a faster return on investment. For example, it might be worthwhile to run the numbers on a geothermal HVAC system.
- just frank
- Posts: 1933
- Joined: Sun Nov 02, 2014 3:13 pm
- Location: Philly Metro
Re: Evaluate Proposal on Installation of Solar Panels
Ok, geothermal SEER is in the low 20s, and modern central AC units will get to the high teens, so a geo might save 25% of the annual AC bill. Even if the OP were spending $1000/yr on AC, a geo would save $250/yr. Given the upfront cost (comparable to PV, and subject to rebates) of at least $10k higher, the simple payback period is measured in decades, as opposed to 7 years for the OPs first, not that great , quote.YttriumNitrate wrote: Yes, so a big chunk of the electric bill is going to come from cooling, not heating.
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Re: Evaluate Proposal on Installation of Solar Panels
Folks,
I have just concluded my discussions with the contractor on the solar panels. I am going to make the purchase. I really want to thank each and every one of you for the valuable suggestions that you provided to me in making my decision.
Everyone have a great week end and a successful year in your investments.
I have just concluded my discussions with the contractor on the solar panels. I am going to make the purchase. I really want to thank each and every one of you for the valuable suggestions that you provided to me in making my decision.
Everyone have a great week end and a successful year in your investments.
Re: Evaluate Proposal on Installation of Solar Panels
Thanks for the updated. Please do update this thread with how installation goes, what your numbers look like in a few month and a year from now, etc.
Re: Evaluate Proposal on Installation of Solar Panels
A 25 year warranty from a company that released its first product in 2008 and is in a field of regular consolidation and failure is not the best decision point. My home will soon be 100% solar pv and thermal but I try to look a the situation with open eyes.Nirav wrote:
I got Enphase micro inverters with 25 year warranties. I doubt the company would offer that long of a warranty if they didn't last that long.
The micro-inverter business is strong and Enphase is the leader in their field. The field may not even exist in 10 years as we are still in the early phases of the solar revolution.
I own the next hot stock- VTSAX
- unclescrooge
- Posts: 6264
- Joined: Thu Jun 07, 2012 7:00 pm
Re: Evaluate Proposal on Installation of Solar Panels
We may be in the early phases of widespread adoption in the US. I doubt we're in the early phases of the solar revolution.WhyNotUs wrote:A 25 year warranty from a company that released its first product in 2008 and is in a field of regular consolidation and failure is not the best decision point. My home will soon be 100% solar pv and thermal but I try to look a the situation with open eyes.Nirav wrote:
I got Enphase micro inverters with 25 year warranties. I doubt the company would offer that long of a warranty if they didn't last that long.
The micro-inverter business is strong and Enphase is the leader in their field. The field may not even exist in 10 years as we are still in the early phases of the solar revolution.
Solar power generation pricing has dropped 99% since the 70s and it's now affordable, which is why we're talking about it.
Microinverter technology is 20 years old. Residential solar panels have been used for 40+ years. The material that goes into solar panels was invented in 1930s and used commercially since the 50s. I doubt we are going to see any "revolutionary" changes in the next 15-20 years. It's likely going to be incremental at this point.
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Re: Evaluate Proposal on Installation of Solar Panels
madbrain: [quote]IMO, on a 6-7kw system, should be able to get get $3/watt with poly + micro-inverters. Part price is $1.80/watt. See my earlier posts in this thread./quote]
So, for a 7 kw system, is a price of 21k good if that is before rebates? (final net cost about 14k?)
So, for a 7 kw system, is a price of 21k good if that is before rebates? (final net cost about 14k?)
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- Crimsontide
- Posts: 729
- Joined: Fri Oct 25, 2013 5:32 pm
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Re: Evaluate Proposal on Installation of Solar Panels
I have been debating the idea of installing solar panels for awhile now. The per kWh cost seems to be coming down to my target range. Since I live in Teaxs mounting anything on my roof instantly brings to mind spring thunderstorms and the damage they frequently do here in North Texas. Are solar panels covered under homeowners insurance policies or is this prohibitively expensive and as such should be included in the total cost?
Re: Evaluate Proposal on Installation of Solar Panels
As I hear it, panels installed on a roof may actually help hold the roof down. That is of interest to me here in the Central Florida hurricane zone. Of course I was told that by somebody trying to sell me solar panels. YMMV. I have not yet verified that info or the insurance details.Crimsontide wrote:I have been debating the idea of installing solar panels for awhile now. The per kWh cost seems to be coming down to my target range. Since I live in Teaxs mounting anything on my roof instantly brings to mind spring thunderstorms and the damage they frequently do here in North Texas. Are solar panels covered under homeowners insurance policies or is this prohibitively expensive and as such should be included in the total cost?
Our costs may be helped a bit by having joined a local solar coop, "cflsolaradvocates.org"
I will post back if we do take the plunge.
I sometimes think that I am living the life of which my immigrant ancestors dreamed.
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Re: Evaluate Proposal on Installation of Solar Panels
crimsontide
I just read your comment relative to homeowners insurance for the panels. I called my insurance provider and they told me that the panels are covred, so you may want to call your insurance company to check out your policy. I hope this helps.
I just read your comment relative to homeowners insurance for the panels. I called my insurance provider and they told me that the panels are covred, so you may want to call your insurance company to check out your policy. I hope this helps.
Re: Evaluate Proposal on Installation of Solar Panels
Much to my surprise, my homeowners insurer refused to cover homes with solar panels. Switching actually saved me some extra money!
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Re: Evaluate Proposal on Installation of Solar Panels
Although there are some physical limits to solar cell efficiency (the Shockley limit), even those can be worked around. I think if we thought of semiconductors which is a "mature" technology, we would find some of the antecedents a very long time ago, the first transistor in the late 1940s etc. Yet SC technology has continued to follow Moore's law for a very long time (pushing the quantum limits now, but even then there are workarounds).Nirav wrote:
Microinverter technology is 20 years old. Residential solar panels have been used for 40+ years. The material that goes into solar panels was invented in 1930s and used commercially since the 50s. I doubt we are going to see any "revolutionary" changes in the next 15-20 years. It's likely going to be incremental at this point.
The incremental change in solar techology could still take us to some very interesting places on efficiency. From say 15-20% now on commercial technologies (?), towards 40-45%?
And since this is materials science there is always the possibility of a revolutionary breakthrough of a new material (eg nanomaterials etc.).
The drop in price is mostly about relatively mature technology and huge Chinese overinvestment in production. It's actually held back the development of some of the newer and interesting technologies. And the quality of Chinese panels is a question mark (in that, people who are in the industry, who install panels on their own homes, seem to opt for non Chinese panels).
I could imagine a situation in 25 years time where we rip off the existing (still productive) panels off our roofs to install ones twice as efficient.
It's on the storage side that the truly big ground may be won.
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Re: Evaluate Proposal on Installation of Solar Panels
I agree that GSHP (geothermal) pays back in an Canadian or upper Midwest climate (maybe New England).just frank wrote:Ok, geothermal SEER is in the low 20s, and modern central AC units will get to the high teens, so a geo might save 25% of the annual AC bill. Even if the OP were spending $1000/yr on AC, a geo would save $250/yr. Given the upfront cost (comparable to PV, and subject to rebates) of at least $10k higher, the simple payback period is measured in decades, as opposed to 7 years for the OPs first, not that great , quote.YttriumNitrate wrote: Yes, so a big chunk of the electric bill is going to come from cooling, not heating.
A relative on an exposed ridge in southern Ontario-- minus 30 on a cold day in winter, +95 on a hot summer's day. They reckoned the payback against electric baseboard was c. 7 years (electricity prices a lot lower then)-- they do also use wood.
ASHP would be nearly as competitive in milder climates (eg the southern states) with the high AC loads.
- unclescrooge
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Re: Evaluate Proposal on Installation of Solar Panels
I agree. In twenty years, power storage will hopefully be as cheap as data storage.Valuethinker wrote: It's on the storage side that the truly big ground may be won.