Alt E Solar Blog

Home » Posts tagged 'Photovoltaic system'

Tag Archives: Photovoltaic system

Let’s Get the Ball Rolling……Up Front Information to Know Before Going Solar

Well, it looks like the New Year is well under way because, believe it or not, February is almost over! Here at Alt E Wind & Solar the phones have been ringing off the hook since many incentives offered by utility companies have renewed. One of the things we love best about our jobs here is the opportunity to educate our prospective clients about everything involved in “going solar” so they are well equipped to make the decision that best suits their needs and, therefore, successfully fulfill their goals. In the process of fielding all these calls with so many great questions, we have come to see a general pattern in the things that people tend to ask, or want to discuss as they are getting started with the process. Below is a list of things to ask yourself, or consider if you are seriously thinking about taking the plunge. Once you have a handle on these preliminary questions and topics, then it will be easy to get the ball rolling!

  1. Are you looking to fully eliminate your electricity bill or just offset it?
  2. What is the last 12 months of kWh (kilowatt-hour) usage for your home? You have to get this information from the last 12 months of your electric bill or simply call your utility service provider.
  3. What is your budget? Financing can be an option.
  4. Does your roof have good southern exposure?
  5. Do you have any open land for a ground mount system if your roof is not optimal?
  6. Do you have a lot of mature trees that may obstruct the sun? Shade is the enemy of optimally functioning solar panels.
  7. What incentives or rebates does your utility company offer? If you forgot to ask them this question when you had them on the phone, don’t worry, Alt E has a great handle on most utility programs and can answer that question when you call.
  8. Did you know the Federal government will provide a 30% tax credit for the cost of you solar system? This is a dollar for dollar reduction to your Federal tax liability, which means that the IRS essentially pays for 30% of your solar system!
  9. Did you know 95% of today’s solar systems are tied to the electric grid? Alt E, however, can design either an off grid OR hybrid system with battery backup. Both of these are a more expensive option but new technology coming in the near future promises to bring these prices down.
  10. Important to know that your installation company should take care of all necessary design requirements, engineering and permitting requirements as well as all required electric utility paperwork.
  11. Did you know the state of Colorado prohibits homeowner’s associations from restricting the installation of solar panels? CLICK HERE if you would like to review the state statute.
  12. Did you know solar panels can withstand high winds and hail very well and also come with a 25 year warranty?
  13. Were you aware that solar panels require little to no maintenance?
  14. And….last but not least, a new solar system will generate a risk free, average annual return on investment of 10-20% over the lifetime of the system!

Again, these are just preliminary questions and topics but doing some research and finding more in-depth information will help a great deal in making your decision and then moving forward. We would, however, love to hear from you should you have any more questions or would like general pricing information over the phone. Should you have further interest, the next step would be for us to set up a sight analysis and then put together a proposal with all the specific information you would need in order to get the job done. We are always here to help so please, don’t hesitate to give us a call today and see what we can do for you!

Please check out our website at www.altewindandsolar.com and our Facebook page at http://www.facebook.com/pages/Alt-E-Wind-Solar-Ltd/196202797091314 or give us a call at 970.482.SOLAR (7652).

GOING SOLAR…….IS IT BETTER TO BUY OR LEASE?

NOW THAT I HAVE DECIDED TO GO SOLAR, IS IT BETTER TO BUY OR LEASE?

Have you recently made the decision to harness the clean energy of the sun and “go solar?” If so, congratulations, it’s a wonderful decision that is great for the environment, the economy and your pocket-book. One of the very next questions you will face is whether to buy a system or lease one.

Many residential solar installation companies like to push leasing. Some will offer “no money down’ or they will charge $1,000 to $3,000 (depending on the size of the system) up front to install the solar panels, and then lock the homeowner into a 20 year contract, where they will have to pay rent every single month for 20 years. For example, if a homeowner has a monthly electric bill of $250, he or she might pay the solar company $125 a month to rent the solar panels and the homeowner’s electric bill would drop to around $100. All in all, he or she would be saving around $25 a month by renting solar panels. This is an example using a system that only partially offsets the homeowner’s electric bill. A large enough system could eliminate the entire electric bill but the monthly rent would be larger and the savings to the homeowner still minimal. Also, it’s important to be aware that solar leases include an approximate 3% annual increase causing the homeowner’s rent payment to increase every single year over the 20 year contract period. These leasing companies also emphasize that they will install the system, monitor and take care of all maintenance. All you have to do is sit back, feel good about the environmental benefits, save money and leave the rest to them. Sounds pretty good, huh? Well there is a whole lot more to the story.

It’s very important to understand the dynamics of actually purchasing a system (remember the solar company is the purchaser when you lease) before making your final decision. A solar system will not only pay for itself in as little as 5 to 10 years, but will continue to make you money over its 35 to 40 year expected life span. Remember, after the system has paid for itself the owner has no electric bill or one that is much lower so the savings grow and grow each year as energy costs rise. This is one of the primary reasons why residential solar leasing companies want you to let them use your roof or your property. Huge utility company rebates are available in many states, some as high as $2,000.00 per kilowatt. With a solar lease you won’t receive a rebate because you are not buying the system. The leasing company will get the rebate because they will own the system that you’ll be making payments on for the next 20 years. This is another reason why residential solar lease companies want you to let them use your roof or your property. The Federal government is offering a 30% tax credit that’s currently available for the installation of a solar electric system on your home. With a solar lease you won’t receive the 30% federal tax credit either because you are not buying the system. The leasing company will get the tax credit because they will own the system that you’ll be making payments on for the next 20 years. Yep, you guessed it; this is another reason why residential solar lease companies want you to let them use your roof or your property. A properly installed solar system requires almost no maintenance, by the way, other than a good rinsing upon occasion to remove dust and debris. Solar modules are covered under a 25 year factory warranty and inverters are covered by a 10 to 25 year factory warranty.  Also, purchasing a solar system substantially increases the value of your property whereas a lease is a liability in the eyes of someone looking to purchase your home.

All in all it is easy to see that the owner, whether it is you or a leasing/installation company, is the one who gets the risk free annual return on investment of 10-20%!  Why not let it be you? If the concept of little or no money down is attractive to you, do the math and it will become clear that financing the purchase of your solar system with little or no money down makes a whole lot more financial sense than leasing. It sure would be great to change over to clean, renewable energy and put a nice amount of money in your pocket at the same time!

Please check out our website at www.altewindandsolar.com and our Facebook page at http://www.facebook.com/pages/Alt-E-Wind-Solar-Ltd/196202797091314 or give us a call at 970.482.SOLAR (7652).

How to Successfully Install Solar with a Set Budget

HOW LARGE OF A SOLAR SYSTEM CAN BE INSTALLED IF I HAVE A SET BUDGET?

Okay, so we’ve discussed how much solar costs if your goal is to eliminate your electric bill (CLICK HERE to read part 1 of that blog post and CLICK HERE to read part 2) and how much solar costs if your goal is to maximize your roof space (CLICK HERE to read that blog post) but what if you have limited funds to invest in solar and don’t want to go into debt to purchase a system (or worse, lease a system, which is always a bad idea). Does that mean you shouldn’t install solar and take advantage of the excellent R.O.I. and all the great environmental benefits? Absolutely not!

We are happy to design a system within your budget! Taking this approach we can tell you what size of a system we can install within your budget and what percentage of your electric bill will be off-set by the power produced from the solar array.

Of course, the first thing we’ll need to know is your budget. Then we’ll need to know your last 12 months of kWh (kilowatt hour) usage (see our prior blog posts in this series for instructions on how to determine this).

The next order of business is to determine your roofs tilt and orientation (we do this during our site analysis). The roof tilt and orientation will determine how much power (electricity) the system will generate given its size. It’s important that your roof have at least some southern exposure.

Once we have this information we can determine how large of a solar system we are able to install given your budget, how much power your system will produce (given its size and your roof tilt and orientation); and what percentage of your electric bill will be off-set by the solar array. With this information in hand you can easily do an “apples to apples” comparison with other solar proposals to see which installer is offering you the greatest value.

Also, keep in mind that if you have a limited budget today, we can always design your solar system to be “scalable” so you can add on to it in the future as additional funds come available.

If you haven’t had a chance yet to read our prior blog posts in this series titled “HOW MUCH DOES SOLAR COST?”, I would highly recommend doing so. There you will find lots of very specific and extremely useful information on price, R.O.I., tax credits, rebates, power production, payback time frames, etc., all of which will be very beneficial as you further explore the possibilities of installing solar on your home or business! You can click the links below to be taken directly to the prior blog posts in this series.

HOW MUCH WILL IT COST TO INSTALL SOLAR ELECTRIC (PV) ON MY HOME OR BUSINESS?

HOW MUCH WILL IT COST TO INSTALL SOLAR ELECTRIC (PV) IF MY GOAL IS TO ELIMINATE MY ELECTRIC BILL (“NET ZERO”)? (part 1)

HOW MUCH WILL IT COST TO INSTALL SOLAR ELECTRIC (PV) IF MY GOAL IS TO ELIMINATE MY ELECTRIC BILL (“NET ZERO”)? (Part 2)

HOW MUCH WILL IT COST TO INSTALL SOLAR ELECTRIC (PV) IF MY GOAL IS TO MAXIMIZE MY AVAILABLE ROOF SPACE?

Please check out our website at www.altewindandsolar.com and our Facebook page at http://www.facebook.com/pages/Alt-E-Wind-Solar-Ltd/196202797091314 or give us a call at 970.482.SOLAR (7652).

How Much Does it Cost to Install Solar on a Roof Top?

HOW MUCH WILL IT COST TO INSTALL SOLAR ELECTRIC (PV) IF MY GOAL IS TO MAXIMIZE MY AVAILABLE ROOF SPACE?

If your goal is to eliminate your electric bill but don’t have enough roof space or land to English: Solar panels on a roofbuild a ground mounted system, then the next best thing to do is maximize your available roof space with southern exposure. Taking this approach we can tell you what percentage of your electric bill will be off-set by the power produced from the solar array.

The first thing you’ll want to do is determine your last 12 months of kWh (kilowatt hour) usage (see Part 1 and Part 2 of our last Blog Post for instructions on how to determine this).

The next order of business is to measure the roofs dimensions, tilt and orientation
(we do this during our site analysis). The roof dimensions will determine the size of the solar system, while the tilt and orientation will determine how much power (electricity) the system will generate given its size.

It’s important that your roof have at least some southern exposure. If yours does not, this does not mean you shouldn’t install solar… it simply means that your system will not produce as much power and therefore your return on investment will not be as great. The ideal orientation for a roof is 168 degrees from north. However, anything from 135 – 205 degrees from north will yield 95% optimal results; and from 115 – 225 degrees will yield a minimum of 90% of the optimal results. Whereas, if you have a roof that faces directly east then your system will only produce at 78% of the optimal level. Likewise, if your roof faces due west then it will only be 69% of the optimal level. So as you can see, just because you don’t have a south facing roof, doesn’t mean your solar system won’t produce… it just means it won’t produce at the optimal level. However a north facing roof line is not well suited for solar here in the northern hemisphere.

The optimal tilt for solar panels in Northern Colorado is a 40 degree pitch. Most roof tops aren’t this steep but even a 20 degree pitch will provide very good results. Unless your roof is fairly flat, we typically recommend a flush mounted system since the incremental increase in electricity production usually doesn’t justify the additional cost associated with increasing the tilt of the panels. However, if your roof is fairly flat then it definitely makes sense to use a tilt-up racking design.

Once the roof dimensions, tilt and orientation are established we can then determine how many solar panels your roof will hold and how much power the system will produce. As a very broad based rule of thumb, each kW (kilowatts) of solar panels installed in Colorado will generate around 1,300 – 1,600 kWh’s annually, depending on the tilt and orientation of the solar panels.

There are many variables in determining the cost of installing solar on your home or business. But one of the most important things to understand is that solar pricing is not linear. Generally speaking, the larger the system is the lower the cost (per watt) will be. A 10kW (10,000 watts) solar system will cost a lot less per watt than a 4kW (4,000 watts) system. Of course, the total cost of a 10kW system will be higher than a 4kW system but the larger the system is the lower the cost per watt and the greater the return on investment.

In addition to size, there are many other variables that impact the cost of installing solar, which we evaluate during our site analysis (ie – breaker panel and electric service, roof structure and material, rafter/truss system, meter location, point of grid interconnection, conduit runs, etc.). However, getting to the heart of the question, the total turn-key cost of having solar installed on your home or business will typically be between $3.50/watt, for larger solar PV systems, and upwards of $6.50/watt for smaller systems. However, anyone who installs solar on their home or business is eligible for a 30% federal tax credit (this is not a tax deduction; it is a tax credit… a dollar for dollar reduction in the taxes you pay to Uncle Sam), thereby reducing your installed cost by 30%. Also, many utilities offer rebates and/or REC (Renewable Energy Credit) payments based on the size of the solar system and the amount of power it produces. These utility rebates can also drastically reduce the cost of installing solar. Please call us at 970.482.SOLAR (7652) if you want to find out what rebates your specific utility offers.

Putting it all together… we’ll use an example addressing everything we’ve discussed in this article, using the following assumptions: your kWh usage over the last 12 months was 15,325kWh’s and you don’t anticipate any change in your future usage; your roof, which faces due south (180 degrees from north), has 625 S.F. of shade free space available and has a 24 degree pitch; and of course you want to maximize the available roof space and determine how much of your electric bill will be off-set by the electric produced from the solar system.

Using 250 watt solar panels (approx. 18 S.F. each) we can determine that your available roof space will comfortably hold 32 solar panels (32 x 18 = 576 S.F. total), which equates to an 8kW system (250W x 32 panels = 8,000 watts or 8kW). Next, using our power production tools (based on 30 years of solar irradiance data collected in Colorado) we can determine that an 8kW system will produce approximately 11,859kWh’s per year (based on the roof tilt and orientation assumptions from above). Therefore, this system will reduce your on-grid electric usage by a little more than 77% (11,859kwh’s produced divided by 15,325kWh’s consumed = 77.4% reduction in your electric bill)

An 8kW roof mounted solar PV system installed by Alt E would cost around $35-36,000 ($4.50/watt), at today’s prices.

Taking the next step, using $35,000 as the installed price, you will receive a federal tax credit of $10,500, thereby bringing the cost down to $24,500. Now let’s assume your electric utility pays you a REC payment of $.13/kWh and your electric rate is $.105/kWh (this is Xcel Energy’s current REC payment price for “small solar PV systems” and its current residential electric rate). Your solar system will save you $1245/per year at today’s electric rates (11,859kWh’s produced x $.105/kWh = $1245.19 annually), PLUS Xcel will pay you under contract $1542 annually (11,859kWh’s produced x $.13/kWh REC payment = $1541.67) for each of the next 10 years (paid monthly)!! Therefore the total annual financial benefit to you is $2787 ($1245 in annual savings + $1542 in REC payments = $2787).

To do a very simple payback analysis, simply divide the net cost (after your federal tax credit) of $24,500 by the annual financial benefit (savings and REC payment) of $2787 to determine that the payback timeframe is 8.79 years. However, we all know that electric rates are only going up (average annual electric rate increase over the past 30 years has been 6.7% annually – doubling about every 11 years), so if you factor in this rate increase going forward, then your actual payback time frame is more likely around 7.5 years. This equates to an approximate 14% annual return on your investment!

However, if you want to calculate your true return on investment (R.O.I.) then it’s important to take into consideration the tax ramifications. Since savings on your electric bill are not taxable, in order to compare the true R.O.I. with other investments, which are taxable, you must ask yourself, “What would I need to earn on a $24,500 investment in order to net $2787 annually from that investment, after I pay taxes?” To answer that question, let’s assume you are in a 25% tax bracket. If that were the case then you’d need to earn $3716 from that $24,500 investment in order to net (after taxes) the same $2787 from your solar system ($3716 less 25% tax of $929). Looking at it this way (which is the proper way of calculating actual R.O.I. on your solar investment), then a simple calculation shows a payback timeframe of 6.59 years ($24,500 divided by $3716 = 6.59 years). Once again, factoring in electric rate increases, your actual payback timeframe is about 6 years or an annual return on investment of almost 17%… where else are you going to get a risk free (a contract with a utility company is about as safe of an investment as there is) return on your investment that’s anywhere close to that?!!! WHY ISN’T EVERYONE DOING THIS???

Please check out our website at www.altewindandsolar.com and our Facebook page at http://www.facebook.com/pages/Alt-E-Wind-Solar-Ltd/196202797091314 or give us a call at 970.482.SOLAR (7652).

How Much Does Solar Cost? Part 2

HOW MUCH WILL IT COST TO INSTALL SOLAR ELECTRIC (PV) IF MY GOAL IS TO ELIMINATE MY ELECTRIC BILL (“NET ZERO”)?

Putting it all together… we’ll use an example addressing everything we discussed in our last blog post (See Part 1), using the following assumptions: your kWh usage over the last 12 months was 15,325kWh’s and you don’t anticipate any change in your future usage; you live on a small acreage and have room for a ground mounted system; your roof is shade free, faces southwest (225 degrees from north) and has a 20 degree pitch; you have plenty of roof space but want to know the cost difference between a ground mounted solar system and roof mounted system; and of course you want to get as close to “net zero” as possible.

Using our power production tools (based on 30 years of solar irradiance data collected in Colorado) we can determine that an 11.5kW system on your roof will produce approximately 15,425kWh’s per year (based on the above assumptions); whereas a 10kW ground mount array built at a 40 degree tilt and 168 degrees from north (100% optimal) will produce 15,286kWh’s. As you can see, this ground mount array will produce approximately the same amount of power (within 139kWh’s) as the roof mounted array but is much smaller in size (10kW vs 11.5kW).

An 11.5kW roof mounted solar PV system installed by Alt E would cost around $43,000 ($3.75/watt), at today’s prices, whereas a 10kW ground mounted system would cost around $40,000 ($4.00/watt). As you can see the cost per watt for a ground mount system is a little more than the roof mount system but the total cost is much less since the ground mount system is 100% optimal and produces about the same amount of power as the less optimal roof mounted system. Therefore the return on investment is much higher for the ground mount system since the price is lower!

Taking the next step, let’s assume you decide the ground mount system is the way to go. Using $40,000 as the price, you will receive a federal tax credit of $12,000, thereby bringing the cost down to $28,000. Now let’s assume your electric utility pays you a REC payment of $.13/kWh and your electric rate is $.105/kWh (this is Xcel Energy’s current REC payment price for “small solar PV systems” and its current residential electric rate). Your solar system will save you $1605/per year at today’s electric rates (15,286kWh’s produced x $.105/kWh = $1605.03 annually), PLUS Xcel will pay you under contract $1987 annually (15,286kWh’s produced x $.13/kWh REC payment = $1987.18) for each of the next 10 years (paid monthly)!! Therefore the total annual financial benefit to you is $3592 ($1605 in annual savings + $1987 in REC payments = $3592).

To do a very simple payback analysis, simply divide the net cost (after your federal tax credit) of $28,000 by the annual financial benefit (savings and REC payment) of $3592 to determine that the payback timeframe is 7.79 years. However, we all know that electric rates are only going up (average annual electric rate increase over the past 30 years has been 6.7% annually – doubling about every 11 years), so if you factor in this rate increase going forward, then your actual payback time frame is more likely around 6 years. This equates to an approximate 17% annual return on your investment!

However, if you want to calculate your true return on investment then it’s important to take into consideration the tax ramifications. Since savings on your electric bill are not taxable, in order to compare the true R.O.I. with other investments, which are taxable, you must ask yourself, “What would I need to earn on a $28,000 investment in order to net $3592 annually from that investment, after I pay taxes?” To answer that question, let’s assume you are in a 25% tax bracket. If that were the case then you’d need to earn $4789 from that $28,000 investment in order to net (after taxes) the same $3592 from your solar system ($4789 less 25% tax of $1197). Looking at it this way (which is the proper way of calculating actual R.O.I. on your solar investment), then a simple calculation shows a payback timeframe of 5.85 years ($28,000 divided by $4789 = 5.85 years). Once again, factoring in electric rate increases, your actual payback timeframe is under 5 years or an annual return on investment of OVER 21%… where else are you going to get a risk free (a contract with a utility company is about as safe of an investment as there is) return on your investment that’s anywhere close to that?!!! WHY ISN’T EVERYONE DOING THIS???

One last thing to note on solar costs… it rarely, if ever, makes good financial sense for the consumer to lease a solar system. While there are a lot of solar companies out there that really push this approach (because it’s solely in their best interest) it is almost never in the best interest of the consumer. They will lock you into a 20 year contract (most with annual rent payment escalators) and tell you that your “rent payments” will be less than your electric bill and they will take care of all maintenance. Well, first of all, if you calculate the total kWh’s that your system will produce over the 25 year warranty period (our proposal shows you this), then you will see that by purchasing the system your price/kWh produced is far, far below the cost/kWh that you’re paying the utility; and far, far below the cost/kWh to lease the system. Secondly, the panels and even some inverters come with a 25 year warranty, so even if there is a problem with your system (very unlikely) the warranty will cover the cost of the new part and the manufacturer will even pay for the labor to replace it. Honestly, it really irritates me when I hear these larger installers use these as main sales points in pushing a lease! It’s simply and completely misleading… to their benefit and the consumers detriment! However, their main sales pitch is that “you don’t have to come up with any money up-front” or “we have a ‘zero down’ lease plan”. Again I call BS… there are several lenders out there who will finance a solar PV system with no money down (we work with two such lenders). Some also sell a “Prepaid Lease Plan”, where they make it look like it cost less up front than it does to purchase a comparable system. Again, do the math (or call us so we can show you exactly how the numbers work) and it becomes crystal clear that a lease is definitely only in the best interest of the installation company! Also, it’s very important to understand that if you lease a solar PV system you will not receive the tax credits or the utility rebates and it will not increase the value of your property! In fact it may make your home harder to sell since the buyer will now be obligated to assume the lease for the reminder of the contract! If you are interested in monthly payments and/or no down payment, please don’t fall for the lease sales pitch, financing a solar system can achieve those same goals and you’ll be far better off financially. Call us… we’re happy to walk you through the numbers of both approaches so you can see for yourself!

Stay tuned for our next blog post which will address… HOW MUCH WILL IT COST TO INSTALL SOLAR ELECTRIC (PV) IF I WANT TO MAXIMIZE MY AVAILABLE ROOF SPACE BUT DON’T HAVE ENOUGH ROOM TO ELIMINATE MY ELECTRIC BILL? In the meantime, please check out our website at www.altewindandsolar.com and our Facebook page at http://www.facebook.com/pages/Alt-E-Wind-Solar-Ltd/196202797091314 or give us a call at 970.482.SOLAR (7652).

How Much Does Solar Cost? Part 1

HOW MUCH WILL IT COST TO INSTALL SOLAR ELECTRIC (PV) IF MY GOAL IS TO ELIMINATE MY ELECTRIC BILL (“NET ZERO”)?

If your goal is to eliminate your electric bill then the next several questions to be answered are: what was your last 12 months of kWh (kilowatt-hours) usage? Was that a typical year or were there things that caused your electric usage to differ from your normal/current usage? Do you have enough shade free roof space with southern exposure? If your roof is not well suited then do you have shade free space on your property for a ground mount system?

When calculating your last 12 months of kWh’s used, you can either: 1) pull out your utilities bills for the last 12 months and look for the total kWh’s consumed per month and then add up the last 12 months; or 2) simply call your utility company, give them your account number and they will give you the month by month breakdown for the past year. It is important to note that for a grid-tied solar system, neither the peak monthly usage nor the average monthly usage are nearly as important as the total annual usage.

After you have determined the past 12 months kWh usage, the next question to be answered is was that a typical year of electric consumption or will there be any change in your electric usage in the future? Maybe you were out of town a lot more than usual, in which case you used less electricity than normal. Maybe you’re planning to build an addition on your home or build a workshop. Or maybe there will be more or less people living in your home going forward. If any of these things are the case then we can adjust the size of your solar array to ensure you achieve your “net zero” goal.

The next thing you’ll want to ask yourself is do you have good shade-free southern exposure on your roof? If not, do you have shade-free space on your property for a ground mounted solar array? Another thing to consider is the tilt and orientation of your roof, as these two things can dramatically impact how much power (electricity) your system will produce. With a ground mount array, we can build the solar array to be 100% optimal. Don’t worry too much initially about the location… we have shading analysis tools and can ultimately help determine the best location for your solar array. The main things to consider here are your location preferences and options; but remember – shade is the enemy!

Once the above questions are addressed then we can determine what size your solar system needs to be in order to eliminate your electric bill. As a very broad based rule of thumb, each kW of solar panels installed in Colorado will generate around 1,300 – 1,600 kWh’s annually, depending on the tilt and orientation of the solar panels (this is a topic which will be discussed in future blog posts).

There are many variables in determining the cost of installing solar on your home or business. But one of the most important things to understand is that solar pricing is not linear. Generally speaking, the larger the system is the lower the cost (per watt) will be. A 10kW (10,000 watts) solar system will cost a lot less per watt than a 4kW (4,000 watts) system. Of course, the total cost of a 10kW system will be higher than a 4kW system but the larger the system is the lower the cost per watt and the greater the return on investment.

Many solar installers will tell you that a ground mounted solar array will cost a lot more than a roof mounted array. This is not necessarily the case! With a roof mounted array we are limited by the tilt and orientation of your roof, which in most cases is less than optimal. Therefore, in order to produce the same amount of electricity, a roof mounted solar array must be larger than that of a ground mounted array, which can be built to be 100% optimally oriented. Let’s say the tilt and orientation of your roof are such that you’ll only achieve 90% of the optimal power production. If that were the case (very common) then a roof mounted solar array would need to be approximately 10% larger than a ground mount array in order to achieve the same power production. In this situation, a ground mounted solar array would be less expensive than a roof mounted array.

There are many other variables that impact the cost of installing solar, which we evaluate during our site analysis (ie – breaker panel and electric service, roof structure and material, rafter/truss system, meter location, point of grid interconnection, conduit runs, etc.). However, getting to the heart of the question, the total turn-key cost of having solar installed on your home or business will typically be between $3.50/watt, for larger solar PV systems, and upwards of $6.50/watt for smaller systems. In addition, everyone who installs solar on their home or business is eligible for a 30% federal tax credit (this is not a tax deduction; it is a tax credit… a dollar for dollar reduction in the taxes you pay to Uncle Sam), thereby reducing your installed cost by 30%. Also, many utilities offer rebates and/or REC (Renewable Energy Credit) payments based on the size of the solar system and the amount of power it produces. These utility rebates can also drastically reduce the cost of installing solar. Please call us at 970.482.SOLAR (7652) if you want to find out what rebates your specific utility offers.

Please stay tuned next Thursday for Part 2: “Putting it all Together”!  Here we will use an example addressing everything we’ve discussed in this post.   In the meantime, please check out our website at www.altewindandsolar.com and our Facebook page at http://www.facebook.com/pages/Alt-E-Wind-Solar-Ltd/196202797091314 or give us a call at 970.482.SOLAR (7652).

How Much Does Solar Cost?

HOW MUCH WILL IT COST TO INSTALL SOLAR ELECTRIC (PV) ON MY HOME OR BUSINESS?

The answer to this question is not as simple as is seems. There are many variables starting with your goals and desires. The first question to ask yourself is what kind of solar photovoltaic (PV) system do you want? There are three primary types of solar PV systems (the kind that generate electricity).

The first type of solar PV is what we call a grid-tie or grid-connected system. This is by far the most common and least expensive. Your solar system is connected directly to the grid so your meter actually turns backward when your system is producing more power than you are consuming and turns forward when you are using more electricity than the system is producing. At the end of the month the utility company only bills you for the “net” amount of electricity used. If your system produced more electricity than you used during the month then you can elect to have the utility pay you for that excess power or have it collect in your “solar bank” to be used at a later date. This type of system is pretty much maintenance free (solar panels have a 25 year warranty) and there is no need for batteries since the grid provides power to your home or business when the sun isn’t shining.

The second type of solar PV is an off-grid system. This type of system is used primarily for homes where grid power is not available or in situations where you simply don’t want the utility to provide your power. These types of systems require a battery bank and can get pretty expensive depending on your electric loads (how much power you will need). Basically the batteries provide all your power and the solar panels keep your batteries charged. Therefore the more power you use the larger the battery bank (and solar array) will need to be. These systems can get pretty expensive over time because the batteries need to be replaced about every 6-8 years, if properly maintained.

The third type of solar PV is a hybrid system. This is usually a grid-tie system with a battery backup and is used by those who are concerned with power outages or grid failure. These are by far the most expensive since we are creating a “smart” system to determine where the power is coming from (solar, grid, batteries, generator, wind turbine, etc.) and where it is going to (your electric loads, to charge the batteries, or fed back into the grid). These types of systems have several additional components and unique requirements that are not necessary with the other types of solar PV systems. The primary advantage to these types of systems is that you are able to have power even if the grid goes down. However, the primary disadvantage is the upfront cost and maintenance expense.

Since 95% of all solar PV systems being installed today are grid-tied, we will begin by first answering the “what does it cost” question for this type of system. We typically take one of three different approaches to designing a grid-tie system depending on what your goals and objectives are:

  1. The first approach is to design a system to eliminate your electric bill;
  2. The second approach is to design a system to maximize your roof space;
  3. And the third approach is to design as large of a solar system as we can within your budget.

We will discuss each of these three approaches in our next three blog posts… so stay tuned!! In the meantime, please check out our website at www.altewindandsolar.com and our Facebook page at http://www.facebook.com/pages/Alt-E-Wind-Solar-Ltd/196202797091314 or give us a call at 970.482.SOLAR (7652).

%d bloggers like this: