In September, 2012 I made the difficult decision to go Solar and got a number of estimates. It breaks down as follows:

Initial system with 14 Solar panels – cost $20,000. Chicken wire to prevent pigeons from roosting under my Solar Panels (yes this happened) – cost $1200. System not large enough for my needs, add 3 Solar panels – cost $4600. Grand total ~$25,800.

After 30% Federal tax credit, my final cost was ~$18,000 or so. Also factor in that in California we have time of day energy pricing where daytime (Peak) is significantly higher than nighttime (Off Peak) and what this basically means is that the average homeowner only has to generate about 2/3 of what they consume in order to break even on their monthly Electric bill. Note that many states do not have time of day pricing to take advantage of and one would have to generate upwards of 100% of what they consume in order to break even on their Electric bill. Without this advantage you could essentially add another ~33% to the cost!

Now even with the above consideration I estimate my break-even point (the point at which my investment will be paid off and from there a profit) to be ~8 years or a bit over. Again, for those without time of day rate schedules you can add ~33% to this which would make it close to 11 years.

These are just average numbers and they vary for each individual and their unique circumstances and requirements but they give you a good idea of just why it is so difficult for many to take this step and invest in Solar.

To be fair there are LEASE options which can be as little as $0 down but many, including myself do not like leasing options for various reasons, not the least of which is typically a fixed lease period of as much as 20 years.

Now, one other thing to be aware of. After 2016 the 30% Federal tax credit will go away unless it is renewed again by Congress (which is highly unlikely) . This is a huge deal because once that goes away then people will have to pay 30% higher out of pocket to get the same system, along with probably an additional ~3 years to reach break-even on their Solar investment . So with no time of day pricing and the loss of the 30% Federal tax credit, the break-even point could reach as high as ~13 or 14 years at current prices!

This is why it is so disconcerting when the CA Electric Utilities are trying to push changes through the California Public Utilities Commission (CPUC) which would make this decision financially harder than it already is and the result is that many who might have been willing to make the investment will no longer feel that it is worth it and hence over time it will increase Carbon Pollution even more!

I included a handy table below which outlines the changes being requested by the various Electric Utilities, which will include footnotes that will expand on that section and provide more detail.

Topic Pacific Gas & Electric (PGE) Southern California Edison (SCE) San Diego Gas & Electric Company(SDG&E) Time of Use Rate Schedule – Current1 Optional Optional Optional Time of Use Rate Schedule – Proposed1 Mandatory, even though it would still be optional for non-Solar customers.6 Optional Optional Credit for Excess Energy Produced – Current .03-.04 ¢/Kwh ~.04 ¢/Kwh. Varies month to month based on market rate. Unable to locate formula. Credit for Excess Energy Produced – Proposed ~9 ¢/Kwh7

~8 ¢/Kwh7 No change proposed Monthly Demand Charge – Current2 $4.50 per month 99 ¢, only if less than 15 Kwh are used in billing period, which would be no one essentially From $9.56 to $14.58 per month depending on rate schedule Monthly Demand Charge – Proposed2 $3 per KW, based on size of system. E.g., a 4KW system would be $12 per month $3 per KW, based on size of system. E.g., a 4 KW system would be $12 per month $21 per month PLUS a whopping $9 per KW!!

Netting Period – Current4 Annual Annual Annual Netting Period – Proposed4 Monthly No change Monthly Virtual Net Metering – Current5 Allowed Allowed Allowed Virtual Net Metering – Proposed5 Disallow No change Disallow Interconnection Charge8 Increase to $100 Increase to $75 or more Increase to $280 or more

Footnotes

Time of Use Rate Schedule – Energy priced based on time of day. More expensive during Peak, cheaper during Part Peak and especially Off Peak hours, also more during summer than winter seasons. Monthly Demand Charge – the minimum monthly charge which the Electric companies charge for maintaining the Electric grid and other infrastructure. Interconnection Rate – the charge for connecting a privately owned Solar system to the electric utility lines. This is a onetime charge. Netting Period – the period in which energy credits will carry over into future billing cycles. NOTE this point is absolutely crucial when considering financial incentives of whether to go Solar. Keep the following points in mind.

Winter - solar systems produce significantly less energy in the winter months as compared to summer months which means that much of the time you will under produce (charge).

Summer - solar systems typically produce the most during the summer months but often systems will still under produce, depending on how hot a particular area is and how often big energy consumers such as A/C need to run in order to keep you comfortable.

Spring and fall months are the best times of year in most if not all areas because you have more sun (therefore more energy produced) and it is also a more comfortable temperature which means on average, less energy consumed and hence when you are most likely to get significant credits for over production .

. With all the above points in mind it is absolutely essential that the Netting Period be inclusive of the entire year so that ALL seasons are factored in to balance things out! Any attempt by the electric utility to change the Netting Period so that it cuts off each month and starts over is clearly an attempt to increase their bottom line and make SOLAR less attractive to the consumer! Bear in mind that the electric utility does not pay the consumer as much for over produced energy as what they charge to sell that SAME energy to other consumers so if they “pay you off” for over produced energy during spring and fall months, you get far less to make up for your under produced months in summer & winter.

Virtual Net Metering – allows Californians in multi-tenant housing to access bill credits from Solar on a shared roof. Time of Use Rate, mandatory option – most Solar customers would benefit from Time of Day pricing because that plan generally means you only have to produce about 2/3 of what you consume to break even on your bill. But still each situation is different and this decision should still be left up to the individual consumer! PGE/SCE Credit for over production – caveat, I need to research this more because the referenced article shows a credit of ~9 ¢ per Kwh but I have a hard time believing they are actually willing to increase the credit to consumers on their own. Interconnection Charge – Unable to find defined current interconnection charge but all 3 Electric Utilities are proposing an increase.

By far the most reasonable change between all three Electric Utilities is SCE who appears to not only be suggesting an increase in the amount they refund consumers for over-production but also is NOT requesting that the Netting Period be changed to Monthly where both PGE and SDG&E are requesting this.

A couple of quotes from this article:



All these new solar fees and complex rate proposals are enough to make anyone’s head spin. The bottom line is that each and every one of the utilities’ proposals would cripple continued solar adoption in California. If utilities succeed in making solar a bad deal for Californians, we lose out on a major opportunity to improve community health and combat climate change during an era of historic drought and runaway wildfires. We put the livelihood of the more than 54,000 Californians currently employed in solar at risk. And we take away the ability of families, local governments, schools and businesses to save on their energy bills through solar power.

We know that Governor Brown and leaders at the CPUC want to keep moving forward, not backward, on growing rooftop solar in the Golden State for all these reasons and more. The three major utilities clearly have a very different agenda—but what rooftop solar has is overwhelming public support. Sign the petition to urge our leaders to protect net metering and continue to build on California’s great solar success story.

Let’s be clear, the most catastrophic changes being requested by both PGE and SDG&E are the. These changes will ultimately mean that far less people will make the move to SOLAR and that is a LOSE-LOSE situation for us and our environment!

I urge every Californian, whether you currently have Solar, plan to go Solar, or even if you never plan to go Solar to sign the following petition and urge the CPUC and the Governor to stand for GREEN energy and against the Electric Utilities attempt to put their profit above human health and the climate. Regardless of whether one chooses to go Solar or not, this is in everyone’s best interest.

Please sign this Petition



Cheers everyone.