Save the Environment and reduce your utility cost – One Module at a Time
Many people are considering a Solar Electric System installation to save the environment and money. You are usually presented with big ticket models that are often out of the reach of an average person’s pocket book and/or energy usage requirements. Instead of the large model, you may want to take a different approach and consider the impact and cost of installing a One Kilowatt Photovoltaic System. With State rebates and Federal tax credits available, it may surprise you what can be done at a reasonable cost to help our environment and reduce your monthly energy bill.
The baseline system which qualifies for the California State Rebate Program is 1 Kilowatt (1000 watts) of installed photovoltaic power. The system would consist of 5 to 8 solar electric modules (depending on module size) an inverter(s) to convert the DC photovoltaic power to household AC power, and a mounting system (for your roof or on the ground). You will need less than 150 square feet in a sunny south facing location (full sun from 9 am to 3pm) and access to an open 240vac circuit breaker.
While a 1 kilowatt system size may be considered small, every kilowatt provided by the Sun means one less kilowatt that needs to be provided by a coal plant (the dirtiest of all power production plants). In San Luis Obispo County a 1 kilowatt system will on average produce 150 kilowatt hours of electricity (more in the summer – less in the winter) per month. Every kilowatt of photovoltaic produced electricity will offset 1.366 pounds of carbon dioxide, this means a 1kW system will offset one ton of greenhouse gas each and every year – for the next 40 to 60 years as the system continues to generate power.
Forecasting the effect of a 1 kW system on your personal energy usage requires understanding your utility company’s “tariff” (rate) structure. Most residential bills are based on a progressive tier structure – as your electricity use goes up the cost of each kilowatt hour purchased goes up. These upper tiers are substantially more expensive (up to 4 times) than the baseline rate, and are where the bulk of the rate increases occur. To find your solar savings, using your electric utility bill, simply reduce your monthly kilowatt hours purchased by 150 kW. To forecast the dollar savings multiply your highest tier usage cost by 150 (kWh) and reduce your utility cost by this amount. For many people just getting out of the “Penalty Zone” of the higher tier energy cost can result in substantial savings. If you are a large user of electricity, then incrementally increase the system size, in turn you will incrementally reduce your utility usage – and cost.
To calculate the state incentives available to you for installing a system, use the current California Solar Incentive of $1.55 per installed watt. For a 1 kilowatt system this would be $1,550.00 (1000 watts * $1.55) which is sent to you in the form of a check at the completion of the system installation. Please be mindful that this is calculated on the EPPB – Expected Performance-Based Buy-Down – which uses the AC output rating of the system to predict energy production and savings. The AC rating takes into account the efficiency of the module (PTC rating) and inverter to determine the performance of the system. For New Solar Homes and Commercial systems there are separate rebate amounts and programs – visit http://www.gosolarcalifornia.org/ for more information.
Then – calculate your Federal Tax Credit based on the balance of the cost of your Solar Electric System. Using an installed cost of ~ $14,000, deduct the state rebate and then multiply the balance by 30% ($14,000.00-$1,550.00 = $12,450.00 * 30%) = $3,750.00 Federal Tax Credit to be deducted off the bottom line of your income taxes. Your final installed cost after rebates and credits equals $8,700.00. (Remember – as system size goes up, installation cost will go down).
You don’t have to be a big spender to have a positive impact on the environment, reduce your usage of fossil fuels, increase the value of your home (20 times your annual energy savings), not be impacted by the ever rising cost of energy (5% per year average rate increase) and be the trend setter for your neighborhood.
Go solar today – our world has waited long enough.
John Ewan, founder of Pacific Energy Company in San Luis Obispo, has
provided photovoltaic equipment and installation for both Grid-tie and
Off-grid applications since 1980.
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