Editor’s Note: This contribution is part of our Sustainability Scavenger Hunt series. Read more here, and download the fun activity book for families and classrooms!


More homeowners, farmers, businesses (even utility companies) are installing solar energy than ever before. Here, we’ll look at the benefits and impacts of a solar electric system installed in 2016 by Valerie and Kevin, who both work at Organic Valley, and we’ll provide some practical information for people curious about putting the sun to work with a grid-tied, roof-mounted, solar electric system.

Kevin and Valerie designed their home with solar energy in mind. The orientation of the house and pitch of the roof were very good for mounting the panels, and there were no nearby shade trees. Looking to protect themselves against future cost increases, and with knowledge of the impacts their energy use has, they decided to evaluate and install an 8.1 kW solar system on their roof. A group purchase program with other Organic Valley employees was the final push they needed to move forward. This might be larger than many residential homeowners may consider, but since their system provides nearly all of their home’s energy, it is a great example to use as a comparison for your own home’s potential.

Kevin & Valerie's home after their rooftop solar installation.

Kevin & Valerie’s home after their rooftop solar installation.

Details about their system:

System Size (kW DC) 8.125
# of Modules 25
Module Brand and Model SolarWorld SW325
Inverter SolarEdge with per panel Power Optimizers and web based monitoring

 

Environmental Benefits of the System

The system Valerie and Kevin installed will produce roughly 10,351 kWh per year, according to National Renewable Energy Lab (REL)-PVWatts Calculator. According to the U.S. Energy Information Administration (EIA), the average U.S. home consumes 10,812 kWh annually. Which means, a system of this size will offset 97% of the average U.S. home’s annual consumption! Over the life of the system, it will produce an estimated 289,000 kWh.

Solar photovoltaic (PV) energy will be an increasingly significant part of our country’s renewable energy transition and is essential to battling climate change and the other impacts of fossil fuels. According to the EPA’s Greenhouse Gas Equivalencies Calculator, over the life of Kevin and Valerie’s solar system, 447,722 pounds of carbon will be prevented from entering the atmosphere by this single residential solar electric system. Other equivalencies are shown below.

Over 30 years, Kevin and Valerie’s solar system will provide the equivalent in clean energy to:

22,863 Gallons of Gasoline Burned
216,780 Pounds of Coal Burned
5,261 Tree Seedlings Grown for 10 Years

And of course, solar technology is always improving, so as time goes on, newer technology will have increased efficiency, and the cost will continue going down as more and more people choose to install solar systems.

 

Financial Impact

One great way to consider the financial impact of residential solar is by looking at the expected costs of installing and owning a solar system compared to the expected lifetime energy output. The cost per kWh for energy produced by Kevin and Valerie’s system will be less than $0.09 per kWh, whereas the current U.S. average is $0.13/kWh (rounded). The term “pre-paying” for energy seems appropriate, and for Valerie and Kevin, the expected lifetime savings is over $62,000 when you consider that grid-electricity will increase in cost over time. A system of this size would cost around $24,300 before the 30% federal Solar Investment Tax Credit and other local incentives.

Average U.S. Utility Rate
(EIA as of Nov. 2016)
Average Cost of Energy from Solar System Estimated Lifetime Savings from Solar*
$.0.1275/kWh $0.0888/kWh $62,612

 

*For a system similar or equivalent to 8.1 kW, which covers nearly all of an average home’s energy consumption. Lifetime savings will be different depending on the size of the system and the energy consumption rate of the household. 

 

Important Financial and Design Considerations

Financing

Many homeowners choose to finance the installation cost of their system, often through their existing credit union or bank. Others work with lenders that specialize in solar financing. Monthly payments and terms vary, but this is a great option for many people.

Leasing and Power Purchase Contracts

Installation firms in some areas offer equipment leases or power purchase contracts, where someone else owns the equipment and takes advantage of the tax benefit, then contracts to sell you energy at a pre-determined price for the life of the system (which should be lower than local utility rates). It’s always good to compare this option to financing in order to determine which option works best for your situation.

Smaller Systems

It’s important to note that many homeowners choose to install smaller systems than 8 kW. If your home uses less electricity or your budget and/or roof space prevent you from installing a system that covers 100% of your enrenrergy use, you can always install a smaller system. Also, anything you can do to reduce your energy consumption in advance of installing solar will increase the percentage of total energy your system can provide.

Utility Policies

Your local utility policy on solar can have a significant impact on the economic benefits of installing a solar electric system. Installers that work in your area should be able to help you understand how these policies can change the impact of your potential system.

Kevin and Valerie are served by a utility with favorable policies. Their utility credits them full retail value for any energy generated that they do not use. This excess energy flows back to the grid, generating a credit equal to the cost of energy from the grid through a practice called “net-metering. In some places, utility policy is being changed in ways that aren’t always beneficial for potential rooftop, grid-tied solar owners. It’s important to ask questions about your local utility policy before signing a contract for an installation.

Questions for Installers

While price is always an important consideration, you should also ask questions about:

  • How long has the company been installing solar?
  • What certifications do the employees and company hold? (Such as North American Board of Certified Energy Practitioners (NABCEP) certification)
  • Can they provide references, referrals and testimonials?
  • What materials and equipment do they use?
  • Do they use sub-contractors? If so, who?
  • What is the length of workmanship warranty?
  • When will the installation begin, and how long will it take?
  • Who completes interconnection/incentive paperwork?
  • Are internal or external conduit runs used?

Click here for a helpful checklist created by the Interstate Renewable Energy Council.

 

How to get started exploring solar for your home

  • Gather 12 months utility information
    • kWh per month
    • Rate paid per kWh
  • Consider mounting locations and square footage of your various options.
  • Contact installers for information (multiple, if possible), and compare system and cost options. You can also ask installers if they know of group purchase programs and other local incentives.
  • Find out your local utility policy on solar.
  • Do your math to determine your home’s cost and benefits based on cost of installation, cost savings over time, available incentives, and utility policy benefits or challenges.

Considering a residential solar system for your home is a big decision, but for most homeowners, the cost savings over time, in addition to the knowledge that you’re reducing your fossil fuel energy use and doing your part to reduce your impact on our planet, are worth the up-front cost.