"No Cost Solar" - is it real?

bobzilla said:

In reply to frenchyd :

I'm not buying a damn tesla or ford EV. State and local allow nothing. But 42 solar panels is way more than my roof could even hold. Just shows that location is extremely important for Solar. The Federal rebate would be a one time credit on your taxes. 

To put the number in perspective, here are 41 panels on the roof of my 30x40 shop. I've got 44 up there now. There's probably room for a few more if we'd planned for it.

I did ask a bunch of questions about wind handling pre-installation, as we can get some serious gusts around here due to our microclimate - enough to lift one of those steel sheds off the wooden base it was screwed into once. They had a pretty high wind rating (I forget the specifics) and they've been solid so far.

The financing for mine included a non-interest portion that was equal to the federal tax credit and due in June (ish). It came through as expected, a big fat return.

The Ford truck EV is a Lightning, not a Lightening.

In reply to Keith Tanner :

Wind is another issue for us. Flat lands during spring especially it's not uncommon for us to see 60+mph straight line winds. Gusts around 70+. Thanks for the reminder. 

In reply to bobzilla :

Luckily, that's a pretty well understood problem because people have been dealing with flat things and wind for a long time :) I think ours were rated to triple digits.

In reply to Keith Tanner :

Because part of our roof is covered by trees and really not that large, and some of the issues with post construction addition of panels to a roof I'd likely go for a ground mount. I wonder how that affects wind stability? On a roof there's very little air gap for the wind to "get a grip" so to speak but a ground mount would be 2-3 feet off the ground usually. 

Great, I hope you're happy. Now I'm off to search the answers on the internets. I'll just tell the wife that the reason I'm on my phone tonight is because Keith made me ask questions. 

In reply to ProDarwin :

I think what you are missing is the rising cost of electricity.  Forget that its $90.

If the rate is X, but you could lock in a rate of 1.28X for 25 years would you consider it?  Most probably wouldn't.  Historical rate increase is 1.6%/yr.  However, what if next year alone it was a 16% increase?  If rate of increase returns to normal immediately afterward, by year 7 the solar bill would be less than the std. electric bill.  By the 25 year mark it would be 75% the cost of std. electric.
 

I'm very familiar with the type of proposal that you got. It's a version of On Bill Financing. It's a bit risky for those that it makes more sense for, as SV reX pointed out, because it you were to ever need to sell your home before the system is paid for, you would own the balance immediately. For similar proposals where their is greater usage/higher energy costs, I would expect to see it paid off in less than half the time. 25 years is insane. If you only have a $90 bill, you don't need a $35k solar system. They must be keeping the credits and rebates, and you are paying full cost for the system, and then some. The fact that they need to initially charge you more than you are currently paying is a huge red flag that the numbers are so bad that they can't even make traditional OBF work in your case (you usually pay the same or a reduced rate.)
 

Locking in your rate sounds great on the surface, but there is a big, risky catch that far outweighs the reward. Also note that your ROI on a $35k investment is near zero. It is reliant on future rate increases to  deliver any return. A typical viable solar system would pay for itself many times over with 25 years (based on current rates) your ROI should be at $70k, not zero. 

Boost_Crazy said:

In reply to ProDarwin :

I think what you are missing is the rising cost of electricity.  Forget that its $90.

If the rate is X, but you could lock in a rate of 1.28X for 25 years would you consider it?  Most probably wouldn't.  Historical rate increase is 1.6%/yr.  However, what if next year alone it was a 16% increase?  If rate of increase returns to normal immediately afterward, by year 7 the solar bill would be less than the std. electric bill.  By the 25 year mark it would be 75% the cost of std. electric.
 

I'm very familiar with the type of proposal that you got. It's a version of On Bill Financing. It's a bit risky for those that it makes more sense for, as SV reX pointed out, because it you were to ever need to sell your home before the system is paid for, you would own the balance immediately. For similar proposals where their is greater usage/higher energy costs, I would expect to see it paid off in less than half the time. 25 years is insane. If you only have a $90 bill, you don't need a $35k solar system. They must be keeping the credits and rebates, and you are paying full cost for the system, and then some. The fact that they need to initially charge you more than you are currently paying is a huge red flag that the numbers are so bad that they can't even make traditional OBF work in your case (you usually pay the same or a reduced rate.)
 

Locking in your rate sounds great on the surface, but there is a big, risky catch that far outweighs the reward. Also note that your ROI on a $35k investment is near zero. It is reliant on future rate increases to  deliver any return. A typical viable solar system would pay for itself many times over with 25 years (based on current rates) your ROI should be at $70k, not zero. 

I think you have some valid points.  Out of curiosity, for a electricity bill of $X, what should a system cost?

 I dont understand this last part:

1) its a near $0 outlay, so ROI isn't calculated off a $35k investment.  Similar to Keith's situation, only solar output isn't as favorable here in NC.

2)what solar system will pay for itself within 25 years?  Do you mean just cover initial cost, or provide a respectable ROI?  Many systems I have seen require a major cash outlay up front, which messes with all ROI calcs, because ROI of the stock market is always going to outperform that.

I have done commercial/industrial energy utility projects. The cost benefit analysis, like which car to buy, is highly subjective and reliant on the buyer's intentions and desires.

In all cases, the benefits for the buyers were not solely related to costs.

To the OP, there was a case of no cost solar on one project where in the removal of the oil generator and related County Inspection fees, plus local electrical utility incentives did make the installation costs no cost by year 2.5. But that is how tricky these statements are. The ROI analysis can be tailored to show ALL LOSS SOLAR or PROFIT SOLAR or NO COST SOLAR and all the reasons are ancillary to the actual solar.

In my experience, the best path is to look at your energy usage long term and determine what MIX of solar or wind or geothermal or NG or Fuel Oil or Electrical Utility are best. In the end, the most effective carbon use reduction plan for abundant energy supply would be very costly for everyone as most for profit utilities only modernize for safer energy generation or are limited by local or state regulators afraid to raise fees. In my opinion the effort to deregulate electrical utility has failed and the best path forward would be to nationalize all electrical generation and transmission with the full understanding that it MUST increase rates because the point of doing it is to get the national grid fixed (reduce forest fires, reduce outages, stabilize rates, and design a system more global efficient generation) and that with cost billions of capital expense. 

In reply to ProDarwin :

I think you have some valid points.  Out of curiosity, for a electricity bill of $X, what should a system cost?

 I dont understand this last part:

1) its a near $0 outlay, so ROI isn't calculated off a $35k investment.  Similar to Keith's situation, only solar output isn't as favorable here in NC.

2)what solar system will pay for itself within 25 years?  Many systems I have seen require a major cash outlay up front, which messes with all ROI calcs, because ROI of the stock market is always going to outperform that.

It's not linear, there are a lot of variables to the cost and ROI of a solar system. 

First you have the fixed costs. The fixed costs are a greater percentage of the cost on small systems Vs. big systems, so smaller systems have longer paybacks. 

Your usage and energy rates directly impact your return on investment. If you don't have much useage to offset, and/or your rates are low, it takes longer to payback the cost of the system with energy savings. How your utility charges for tiers of usage is very important. If it uses a tiered approach, you get the fastest payback when you knock out the higher tiers of usage. Say you are charged .15 per kWh for tier 1 and .30 for tier 2, and your bill happens to be split evenly between the two tiers. Say you need 30 modules to zero your bill. The first 15 have a higher ROI and shorter payback because they are knocking out expensive power. The next 15 are knocking out cheap power, and will take twice as long to pay for. That is why is often not cost effective to try to zero your bill, but to shoot for knocking out 90% or so of your useage. 
 

The average payback on a solar system in the US is between 6-12 years. CA is closer to 6, anything over 10 really isn't a good candidate. Payback is when your system pays for itself in savings. ROI is what it pays back over the life of the system. Both are important, but can be adjusted independently. Let's use our hypothetical example above. If 15 modules knock out our tier 2 bill, just installing 15 panels would have a quick payback. Ignoring the fixed cost, let's say that undersized system pays back in 5 years since each panel is offsetting expensive electricity. If we add 15 more panels to knock out tier 1, those modules take 10 years to pay back, since they are eliminating half cost electricity. So the overall payback is 7.5 years. In other words, only installing 15 modules has a payback 2.5 years earlier. It looks like the most bang for the buck solution. But let's look at total ROI. The first 15 panels pay for themselves in 5 years, and will pay for themselves 5 times over the life of the system. The next 15 panels will pay for themselves 2.5 times over the life of the system. So lower return rate, but still more dollars overall over 25 years. And a bit better after you figure the fixed costs for the initial 15 panels that you do don't need for the other 15. 
 

In your example, a system with a 8 year payback at $115 per month would cost just $11k total. Now, you aren't likely to find that, because your bill is below the lower end that can support a solar install. 

I have fourteen acres of non farmable land behind my house plus another fourteen that is farmed. The farm rent nets $200/mo which pays what it costs to own the property. I would consider five to ten acres of power generation on the NF land if it wouldn't cost a million dollars. My concern really begins with initial outlay.

QuasiMofo (John Brown) said:

I have fourteen acres of non farmable land behind my house plus another fourteen that is farmed. The farm rent nets $200/mo which pays what it costs to own the property. I would consider five to ten acres of power generation on the NF land if it wouldn't cost a million dollars. My concern really begins with initial outlay.

Out of curiosity, outside of the financial impact, what would be lost if you did put panels on 5 acres? Any views? Access to anything? Why is it non-farmable? 

This has some interesting calculus behind it. You're trying to hit a target that is moving on multiple axes - cost of energy is going up, while I expect the cost of solar panels is going down. I've heard that it is about $500k per acre, which generates about $1k a month in revenue selling back to the power company... Which may or may not be accurate and may or may not be possible depending on your location. 

It is getting close to being worth it if those numbers are accurate (12,000/.03=400,000, which is ignoring maintenance and depreciation/EOL costs), but it isn't quite there yet. If the electric rates continue to go up though, and you could sell it for more, maybe we're there. But holy cow is that initial outlay tough to swallow. I wouldn't do it if those numbers are accurate. But a $50k grid? Yeah, that is getting more reasonable, especially if you bake it into a 30 year mortgage. But I sure wouldn't want that obligation on its own.

It's always going to be difficult to compete with utility-scale installations with a small for-profit array for the simple reason that bigger is cheaper. If the price of building an array goes down for you, it also goes down for the utility. And yeah, if you're building anything for profit there's going to be an up-front cost, whether it's a building or a factory or a power station.

With our home array, we had the choice of selling our extra back to the power company at wholesale rates, or getting credit for future power use. The selling price was miniscule, just a few cents per kWh. Definitely not worthwhile.

frenchyd said:

jharry3 said:

I'm not going to be guilt tripped into falling for the Green Energy craze.   Its an orgy of self-sacrifice and we are voting ourselves into a majorly wrecked economy. (Meanwhile the Chinese are merrily burning coal to power their rise and laughing at us)

Every single method pushed, other than hydroelectric dams, has multiple hidden costs in terms of money, dependability, and environmental damage for the raw material collection.    Solar panels seems like adding a sail to your roof just waiting for a hurricane to rip it all off.   

Last week in the heat wave in Texas the wind speed died down.  Power conglomerate announced rolling blackouts because the wind mills would not be putting out the power needed to run all the air conditioners.   

Oh wait, hydro power disrupts the fish in streams and rivers so isn't Green...

Forget the politics.  Just focus on Green folding stuff with presidents pictures on them.  ( MONEY ) 

        Demand for electricity is out growing our ability to provide it.  So we can build  expensive new  plants.  Look at what Texas is doing. Yes,  oil rich Texas. 
  They are leading the nation in the use of renewables  with a lot more in the pipeline.  The reason they are doing it is because it's a quick return on their money.  
    They also have great sun and very good wind.    
  Then there is the independence angle.  Buy your electricity from the local Electric company and they can raise rates whenever  the want.  
  Or you can put up your own and control your own future. 
     Finally whoever told you China is building more coal fired plants, really is lying. Perhaps in  The past.  China is rapidly approach 50% renewables.   They used to buy coal from Australia  because they are running  out of their own coal. 
  China is the cheapest source of solar panels.  And second cheapest source of wind.  

Oh jesus... stop. You are literally making E36 M3 up again.

China has more coal fired power plants than the following top 19 countries.

China has quadrupled their coal plants in the last year

China isn't planning to start reducing their CO2 output until 2030. 

The vast majority of China's renewable energy is now solar or wind. It's hydroelectric and nuclear power. 21% of their power production in 2021 was Hydro and Nuke, 11% was Solar/wind. The other 63% was Coal, oil and gas with the vast majoroty coal.

In reply to frenchyd :

In reply to Boost_Crazy :

The bids I received all had a monthly payment attached with them. So if the interest rate isn't bad, you can trade a monthly payment for electricity for a monthly payment for panels.  Remember to calculate a periodic raise in rates.  I use a 1% annual increase to be very conservative.  My state allows utilities to raise rates 2% without any hearings. 
    If your monthly electric payment is too low, then the  decision has to be made if it's worth it to you to pay more than your electric bill.  
     The federal government provides a $7500 incentive.  Even if your state does nothing to help you. And your local area doesn't offer any help.  ( (check with your local power company as well,  usually they provide at least some connection fee help.  ) 

Heck, you are providing them with free additional power.  ( unless you have a back up battery system). 
 

You could stick your money under your mattress- high risk, no reward. Or you could stick it in a CD. Low risk, higher reward. Just because you can do something doesn't mean you should. Taking out a 25 year loan for $35k just to break even is not a good move. It's not too dissimilar from sticking your money under your mattress. 
 

It really doesn't matter what bids you received. Unless you are offering to pay for  ProDarwin's solar, they have nothing to do with his situation. 

Yeah, those "No Cost" ads can seem a bit too good to be true, but there's some legit stuff behind 'em. Thanks to government incentives and rebates, you can actually get a pretty sweet deal on solar panel setups. The catch is you might have to agree to a long-term contract or lease, so they kinda get you on the back end.

mtn said:

QuasiMofo (John Brown) said:

I have fourteen acres of non farmable land .....

 But I sure wouldn't want that obligation on its own.

There was a potential plan for a mid lower peninsular Michigan farm around 2017 when I was traveling there for work. On the local news a farmer had partnered with a solar panel company to have mobile panels. I don't remember the names and no little of farming but the farmer had to leave X amount of the farm non productive for a season or something to restore the soil and they would park the panels over that area for that season the panel would power the watering systems for the other areas and when the next area needed to be restored they moved the panels on carts. That was 6 years ago and I never heard of it since so maybe it wasn't viable. But getting some power to use onsite versus just unused land for a season is an interesting financial analysis. Does it reduce loss of NF land to allow the farm to be more financially viable? IDK.  

In reply to bobzilla :

Your same sources state that China has the same relative gap in operating renewables compared to the rest of the world. As in, the PRC seems to have renewable production equal to the rest of the world combined.  The PRC has built their economy on manufacturing which pulls a lot of energy and they are on par or ahead of the USA on the transition even if they have a spike in coal generation plants, they are moving with effort towards renewables.

I am curious if the taxpayer money and laws in the USA to develop federal programs to entrench Coal and Petroleum energy into the country generated the same strong positions as the current discussions of how much federal programs should move us to renewables 100+ years later.

In reply to Keith Tanner :

It's always going to be difficult to compete with utility-scale installations with a small for-profit array for the simple reason that bigger is cheaper. If the price of building an array goes down for you, it also goes down for the utility. And yeah, if you're building anything for profit there's going to be an up-front cost, whether it's a building or a factory or a power station.

With our home array, we had the choice of selling our extra back to the power company at wholesale rates, or getting credit for future power use. The selling price was miniscule, just a few cents per kWh. Definitely not worthwhile.
 

For profit arrays are a whole different game than arrays built to reduce end user energy costs. If an end user is installing solar, they are doing so to eliminate the high cost that they are paying. Their ROI is calculated off of those inflated costs. A for profit array bases it's ROI off of what that energy can be sold for, so each watt of electricity generated contributes significantly less to the ROI vs. an end user array. It's also why commercial solar is more difficult to sell. They usually get lower rates than residential. The difference in ROI per module needs to made up with volume, so the systems need to be significantly larger to return the same amount of dollars. And initial cost is higher. Which is why tax breaks and other incentives are so important for large scale solar. 

In reply to Advan046 :

And their pollution is more than the next 11 countries combined as well. You can have a lot of renewables and still be a mass polluter. The purpose was to bring some factual things into yet another frenchy bs rant with made up numbers. 

Fun fact, the Yangtze river in 2021 was the lowest its ever been and put a hurt on electricity production. That fear is what led to them adding 2 coal plants a week in 2022 to make sure they have sustainable power for their needs. 

Boost_Crazy said:

In reply to Keith Tanner :

It's always going to be difficult to compete with utility-scale installations with a small for-profit array for the simple reason that bigger is cheaper. If the price of building an array goes down for you, it also goes down for the utility. And yeah, if you're building anything for profit there's going to be an up-front cost, whether it's a building or a factory or a power station.

With our home array, we had the choice of selling our extra back to the power company at wholesale rates, or getting credit for future power use. The selling price was miniscule, just a few cents per kWh. Definitely not worthwhile.
 

For profit arrays are a whole different game than arrays built to reduce end user energy costs. If an end user is installing solar, they are doing so to eliminate the high cost that they are paying. Their ROI is calculated off of those inflated costs. A for profit array bases it's ROI off of what that energy can be sold for, so each watt of electricity generated contributes significantly less to the ROI vs. an end user array. It's also why commercial solar is more difficult to sell. They usually get lower rates than residential. The difference in ROI per module needs to made up with volume, so the systems need to be significantly larger to return the same amount of dollars. And initial cost is higher. Which is why tax breaks and other incentives are so important for large scale solar. 

The reason I mentioned for-profit arrays was because of what Mofo was saying about having some non-farmable land. I read that as a moneymaking idea, not a "cut down on my own personal costs" concept. I may have been mistaken.

In reply to Keith Tanner :

In Michigan, a wind turbine might be a better bet. 20 mw in the back yard. They can rent the space and provide power.