DEBRIS.COMgood for a laugh, or possibly an aneurysm

In April, 2001, I did an analysis of the installation costs and payback term for a solar energy system. My conclusions may not have been valid, because I made some assumptions that were definitely inaccurate (such as the cost of utility power). My numbers, then: for a 2 kilowatt system, installation cost would be roughly $20,000 and take over 25 years to pay for itself.

Yesterday I had an opportunity to get a real-world estimate. We went to a solar energy fair, met with installers, and listened to a panel of homeowners who had recently installed “PV” (for “photovoltaic”) arrays.

The homeowners made a convincing case. There was no sign of buyer’s remorse; every speaker was excited about using clean power. Most spoke of the addiction of watching their electric meters run backward. (These are “grid-tied” systems, meaning that surplus power flows from the PV array back into the electric utilities’ grid. PV users earn credits for grid-supplied power later, e.g. at night when the array’s output is zero.) Each speaker stressed the point that financially this investment is a “no-brainer.”

Well, I have a brain. Whenever someone tells me I don’t need to use it, I grow suspicious, like when Schwarzenegger brushes off a press inquiry with a no-answer answer like “I will fight for the environment… nothing to worry about.” We ran our own numbers.

The basic formula for California residents is this:

• Generation capacity x $8.50 per watt = Gross cost
• Generation capacity x $3.80 per watt = California Energy Commission rebate
• Gross cost minus CEC rebate = Out-of-pocket cost
• Out-of-pocket cost x 0.15 = California tax rebate (a one-time tax incentive)

For a 3.5 Kw system, which would typically supply a family of four, or a family of two if one of them keeps a stack of servers in his office closet… 3500 x $8.50 = $29750 gross; 3500 x $3.80 = $13,300 rebate; this leaves an out-of-pocket cost of $16,450, of which we’d get $2467 back the following year in a tax refund. Final net cost: just under $14,000. At our current usage level, that would take about 15 years to pay for itself. From years 15 through the life of the panels, we’d get essentially free power.

How long do PV panels last? They’re warrantied to produce at least 80% of their rated output for 25 years. After that, arrays can be supplemented with a few new panels to keep the output level consistent. I’m not sure anyone knows how long panels really last, but vendors claim they’ll function for 30-40 years. In other words, we’d have free or very cheap, clean, renewable energy for 10 to 15 years. At that point, I assume there would be incremental upgrades available to replace older, less-efficient parts; if so, the lifespan of the basic system could be extended indefinitely with occasional supplemental purchases.

Building the right size system is the key to a quick payback. PG&E, the local bankrupt energy utility, won’t write a check to anyone generating more than they use, so there’s no point building a bigger PV array than is needed on a yearly-average basis. Most users seem to aim to generate 50-80% of their total consumption.

The window of opportunity is closing, though. The CEC’s $3.80/watt buydown program could end as soon as November. The 15% tax refund drops to 7.5% next year. For a change, it pays to be an early adopter.

I learned something surprising, or more accurately dismaying. I was initially interested in PV systems because of our energy utility’s inability to keep the lights on. The combination of rural highways, aerial power lines, and hayfever-addled pickup-truck drivers means we lose power monthly due to downed poles. PG&E’s mismanagement of funds led to inadequate tree trimming, which allowed a 75-hour outage last December, due to “high winds.” I entertained, even nurtured the fantasy that my PV array would see me through these grid outages.

Grid-tied systems don’t work that way, though. During a utility blackout, a solar array is useless, unless the solar system is set up with a bank of expensive and toxic batteries. Installing several hundred pounds worth of lead and chemicals, which have to be replaced every 8 years, seems like a poor way to pursue a greener, less-toxic lifetsyle.

We’ll have a solar installer do a site review anyway. We’ve wanted green energy for years, and we’re now in a house that we plan to keep forever, so solar makes a low-risk investment — especially considering the subsidies and tax credits. When the power goes out, I’ll just stop typing for a few hours. That seems like a more-green lifestyle choice already.