The benefits of solar energy are obvious.
I don’t think anyone can argue that it’s
not amazing to generate your electricity from
the power of the sun, but the biggest question
is often cost.
Will the savings you gain from solar really
pay for the cost of installing the system
in the first place?
And even more secondary questions come up
like, are they difficult or expensive to maintain?
How long do they last?
Will they work where I live?
Those are all questions I hear a lot, so let’s
dive into this.
I started looking into solar about five years
ago, but two things were holding me up: cost
and shade.
Those two are tightly intertwined when deciding
if a solar system in is right for you.
You need to be able to generate enough solar
energy to help offset the cost of the system.
The ideal setup for solar panels in the Boston
area is a southern facing roof at an angle
of 42°.
My house faces east to west, but with the
latest panels it’s still works just fine.
On top of that my house is wedged into a sea
of tall, old trees that cast a lot of shade
in the afternoon.
Not a good recipe for solar.
Well, 3 or 4 years ago we had to remove some
trees because they were dying, and then in
two separate storms we had a couple of trees
fall, so our roof ended up getting much more
sun.
That meant solar became a viable option.
This one is a little tough to answer because
it really depends on where you live.
There are different state and federal tax
rebates or credits that may be available to
you, as well as special solar loans and incentive
programs.
These can have a profound impact on the overall
cost and payback period of any system you’re
looking into, As well as your kWh energy costs
in your area.
I used a free service called EnergySage to
help me calculate the rough cost of a system
in my area along with those rebates, as well
as helping me to find a good solar installer.
I was so happy with my EnergySage experience
that I’ve joined their partnership program
and have an Undecided portal that you can
visit to research cost and installers.
They’re a vendor-neutral resource that was
partly funded by the Department of Energy
to improve the customer experience when reasearching
and shopping for solar; and they run the most
visited solar website in the country.
Their marketplace gets you online quotes from
pre-screened installers in your area at 10-20%
lower prices.
I’ll include a link in the description.
To be completely transparent, this is an affiliate
program for my channel, so if you research
and find an installer using EnergySage, it
helps to support the channel.
It’s a completely free service, which I’ve
used myself and can vouch for how much it
helped me through the process.
Whether or not you use my EnergySage portal
doesn’t matter, I strongly recommend EnergySage
for your research and questions.
Let’s break down the exact costs of my system.
I had 26 LG panels with micro-inverters installed
for a 9.49 kW DC system at a cost of $29,609.
Yeah.
It’s pricey.
My system is eligible for the Federal solar
tax credit that will reimburse up to 30% of
that cost.
A quick note on the Federal solar tax credit:
starting in 2020 the residential credit will
drop to 26%, 22% in 2021, and by 2022 will
be gone, so if you want to take advantage
of the program, you only have a couple of
years left.
In addition to the $9,883 we’ll get back
from the tax credit, we’re also benefiting
form the SREC program (solar renewable energy
certificates), which is paid out by the energy
market for how much our solar system puts
back into the grid.
For that we opted for a fixed monthly price
vs a variable quarterly price because it made
more sense for our situation.
In the end it’s $126/month for 10 years,
or a grand total of $15,146.
SRECs aren’t available in all states, but
many states offer other types of rebates and
incentives.
And then there’s still the straight up savings
in energy usage.
When you have a solar system installed, you
should also be getting a net meter that replaces
your standard electric meter.
It’s basically a meter that can roll forwards
or backwards depending on if you’re pulling
energy from the grid or adding to it.
When your system is producing more energy
than you’re currently using, the surplus
is going to the grid.
That means your meter is running backwards,
essentially banking that energy for you to
pull from later.
On my system, it’s projected to generate
about 6,600 kWh per year, or roughly 60% of
my yearly usage.
That’s an estimated $1,400 a year in savings
on my electric bill.
One quick side note: any reputable solar installer
should provide you an accurate estimate on
energy production over the course of 10 - 20
years, which will also take into account the
degradation of the panel efficiency.
They should also provide you with some kind
of energy guarantee.
My installer guaranteed at least 95% of the
estimated production or they’ll cover the
difference.
So that’s $19,726 for the whole system after
the 30% tax rebate.
And factoring in around $2,915 a year through
electrical savings and SRECs, that means the
system will pay for itself in about 6 years
8 months.
That’s assuming I paid for the system upfront
in total, which I didn’t.
We went with a private 10 year solar loan
through Avidia Bank, which has an interest
rate of 5.99%.
Taking that interest into account and the
system will have paid for itself in 9-10 years.
That’s on a system that’s warrantied for
20 years and can be expected to last 25 years
or more.
Depending on your annual household income,
there may also be special low or no interest
solar loans available to you.
For me, so far on a monthly basis it’s about
the same out of pocket costs as I had before
solar.
A $150 loan payment, offset by $126 SREC check
and lower energy costs from the grid.
In the summer time I’ll see that get even
better, and once the loan is paid off it starts
to turn a major savings.
That means I’ll be saving about $120 per
month, or around $1,400 a year, from around
year 9 onwards.
But it will most likely be more than that
because energy prices have been rising about
2-3% each year in my area.
And I can already hear the comments, “you’ll
never get that back if you move out before
you recoup the cost of the system.”
To that, you’d be right if I was leaving
my house in a year or two.
However, if you finance and pay for the system
yourself and don’t lease it, adding solar
to your home actually increases your home’s
value by 3-4%.
You’ll often see about $4 per watt of the
installed solar system added to your home’s
value.
While I’m not counting on that for my system,
it’s nice to know that I should be seeing
some sizable increase on my home’s value
when I go to sell.
From start to finish it took about 3 1/2 months
to get solar installed on my house.
That sounds kind of bad, and it needs to get
faster than that, but was a fairly straightforward
and painless process.
Most of the time in the beginning was talking
to different solar installers, selecting one,
hammering out the details on the size and
type of system, and signing a lot of contracts
and agreements.
Once we had a contract signed, it took about
two months before our installer had an opening
to install the system.
The actual install took 1 1/2 days and we
were extremely happy with the professionalism
and workmanship of the team.
All photovoltaic systems are generating DC
current, which has to get converted into AC.
There are three methods to do this: string
inverters, micro-inverters, or power optimizers.
The most common are one of the last two.
String inverters operate like old fashioned
Christmas tree lights.
If one panel stops producing electricity,
then all panels in that string stop producing
electricity.
Micro-inverters and power optimizers don’t
suffer from that and can keep generating electricity
from other panels.
If you’re on a string or power optimizer
setup, you’ll typically have a centralized
inverter located somewhere on the outside
of the house.
This is where the change from DC to AC occurs
before moving into your electrical meter and
panel.
For mine there isn’t a centralized inverter
because there are micro-inverters on each
panel, but there’s a central cutoff for
the system.
If anyone from the electric company or emergency
services need to shut off the system for any
reason, it’s as simple as flipping one switch
on the outside of the house.
The flow continues from the meter into the
electrical panel on a dedicated circuit, which
means there’s a second place I can discount
the system.
The outside switch cuts off the system from
everything.
The inside switch cuts off the solar system
from the house only.
After the install, it was a waiting game for
the electrical and structural inspections,
and for the energy company to approve the
system and switch us out for a net meter.
The solar installer took care of all paperwork
and permits, so all we had to do was wait.
In the very beginning of October we got the
call that the system was approved to be turned
on.
I actually got word as I was on my first big
Tesla road trip, which I made a video on if
you’re interested.
As excited as I was to turn the system on,
it was a gray and rainy day ... so in the
end it was kind of anticlimactic.
This is where I’m going to have to do a
follow up video at the 6 month or 1 year mark.
The system has only been up and running for
a little over 3 months, and it’s during
the time of year where production is the lowest.
We’re in the middle of winter with the least
amount of sun, and even when the sun is up
it’s very low in the sky.
In the very beginning of October I was seeing
days between 10 kWh - 17 kWh, but in December
it’s been bouncing around 1.5 kWh to 6 kWh.
It’s important to look at the total production
on a monthly and yearly basis and not get
bogged down in the day to day.
So looking at the monthly totals I have so
far:
October 2018 - 239.85 kWh
November 2018 - 114.27 kWh
December 2018 - 90.52 kWh
That works out to about $100 in electricity
savings in 3 months.
Nothing to write home about, but those numbers
will look radically different when we get
into spring and summer.
If anyone is interested, I can do a follow
up later in the year.
As I mentioned earlier, I started looking
into solar about 5 years ago and it’s surprising
how much the prices have improved in a matter
of a few years.
One of the first quotes I got about 3 years
ago was for the same price as the system I
had installed now, but it was only a 5.8 kW
system.
Virtually the same price, but the new system
has a 40% increase in energy production due
to the higher efficiency panels available
now.
The price per watt for solar systems has been
dropping dramatically over the past 8 years
due to more efficient panels, cheaper inverter
costs, installation costs, and various other
factors.
EnergySage is seeing about $3.00 per Watt
right now for residential installations.
If you look at utility scale energy plants
and factor the cost to generate one megawatt-hour
of electricity, solar is now cheaper than
gas, coal, and nuclear.
Coal costs around $102 per megawatt hour,
while solar is around $45.
The biggest challenge with solar is energy
storage.
Our energy grids generate the exact amount
of energy needed at any given moment.
That means they constantly have to ramp up
and down how much energy they’re generating
over the course of day to match demand.
They don’t produce a surplus because there
hasn’t been good solution to mass energy
storage.
Mismanage the production vs. demand and you
could end up with blackouts.
The obvious benefit to coal, gas, and nuclear
plants is that they can operate 24 hours a
day, while a solar array is only generating
during daylight hours.
But during those daylight hours, PV systems
can generate an incredible amount of energy
for a low cost.
That’s where energy storage comes in, which
not only helps with renewable energy production
sources like solar, but also help to manage
peak load.
Some energy companies have been using dammed
hydroelectricity to store energy production.
They use surplus energy to pump water into
a reservoir at a higher elevation.
When they need to release the stored energy,
they open a dam to let the water flow back
down to a lower reservoir to generate power.
Other systems are doing similar things with
rail cars being moved up and down an 8-mile
section of inclined track.
But the most promising system of storage is
battery packs because they’re highly efficient
in storing and releasing the energy.
If there’s a sudden peak in energy demand,
battery packs can respond to that increase
in power requirements in milliseconds.
The end result from systems like this is a
more responsive and adaptable grid, which
helps to create more stable pricing.
Tesla has shown how well these battery power
stations can perform in Australia.
They installed a $66 million battery pack
system, that is designed to replace peaker
plants, and has reportedly saved 90% in grid
service cost.
In the first 6 months of operation it made
up about $17 million in savings.
Systems like this, dams, and hauling weights
to store power, are opening the door to better
managing our electrical systems.
And they open the door to more reliance on
renewable energy sources like solar, wind,
and hydro.
We can store the massive surpluses they create
and use storage to release that energy when
we need it.
For your home there are similar battery pack
options you can get.
There are products like Tesla’s Powerwall,
LG Chem’s RESU battery, Mercedes, Nissan,
BMW, and more are also getting in on the action.
Whether or not a whole home battery makes
sense for you is another tricky calculation.
For me, my solar system isn’t producing
enough energy to truly take advantage of a
battery system, and if I went onto a battery
I’d lose the financial benefits of the SREC
monthly payback.
If you live in an area that doesn’t have
SRECs, and also has time of use energy rates
(cheaper at night, more expensive during the
day), you’re probably a great candidate
for a battery system.
Getting a solar system installed on your roof
or as an array in your yard is definitely
an expensive proposition.
There’s a lot to factor, like how long you
expect to stay in your home, do you have enough
space on your roof or yard for an array, and
will the energy generation help the system
pay for itself?
It’s a very personal decision with a lot
of variables, but I was surprised by how much
energy we’re able to generate off of such
a small roof in a less than ideal location.
My system will pay for itself in less than
10 years, adds to my home’s value, and helps
to offset charging my EV.
For me, it was a no-brainer.
Now if you’re someone interested in going
green, but don’t own your home or aren’t
a good candidate for solar, there are still
ways you might be able to make changes.
Some areas allow you to select your energy
source.
Here in Massachusetts you can select an energy
supplier, so you could choose a company that’s
100% green.
Some areas also have programs to do an energy
audit of your home and help you make changes
to improve its energy efficiency.
Again, here in Massachusetts we have a program
called Mass Save, which will do just that
and even offer rebates to help pay for it.
You might have to do some digging, but your
local governments and agencies may be able
to help.
And finally, be sure to check out my EnergySage
portal for researching solar, calculating
the costs, payback periods, and any other
questions you have.
They’re a tremendous resource and completely
free.
You can plug in your information and request
quotes from solar installers, which all get
funneled into your EnergySage account.
You don’t have to worry about getting flooded
with phone calls.
It makes it easy to compare installers, cost
estimates and energy production quotes in
one place.
And installers also have customer rankings
and feedback, so you can find a reputable
and good quality installer.
While I didn’t go with Tesla Solar, if you’re
looking at Tesla, you can use someone’s
referral code to get a 5 year extended warranty.
If you’d like to support the channel, you
can use my referral code, which I’ll include
in description.
If you liked the video, be sure to give it
a thumbs up and comment below if you have
have solar and how it’s been working out,
or if you’re still thinking about it and
have questions that I didn't cover.
I’m sure there a lot of people out there
that can provide some good details and suggestions
from their experiences too.
And don’t forget about the limited edition
Tesla Wall Connector giveaway I’m running
right now.
The giveaway is available in the United States
and Canada, and is running until March 8th
at 11:59pm Eastern time, so be sure to get
your entries in before then.
I’ll announce the winner on Twitter, Instagram,
Facebook, and here on the channel’s YouTube
Community tab.
If you’d like to support the channel, there
are some ways you can do so.
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I have a SFSF Shop page that includes some
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A big shout out to one of the new Supporter
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