Wednesday, April 17, 2013

Solar Update

We'll, Sungevity came and went.  It was a super-fast interaction.  Most of their analysis is done on the web rather than on our roof.  Here's the deal--

If your electric bill is high, it's likely that you're paying the highest price per kilowatt out there.  PG&E's electric rates are progressive, so the first x kilowatts are priced affordably, and as you go up the "tiers" of tier pricing as your consumption increases (due to larger house and/or less efficient appliances), your price per kilowatt for that electricity reaches nearly three times the unit cost of the baseline rate.  Instead of 13 cents a kWh you're paying 34 cents a kWh if you're a big consumer.

Sungevity makes sense for those who would use solar to offset that highest tier of consumption.  (And who have a place for the panels facing south and/or west--we have a roof slope that no one can see that faces SW.) Let's say that solar panels cost about 20 cents a kWh--if you had a smaller house and consumed only the baseline amount (50-60% of average consumption in the "turf") at 13 cents a kWh, it would not make sense to install solar.  But if you're paying 34 cents/kWh for the second half your usage, then installing solar at 20c/kWh makes a lot of sense.

Read more about tier pricing (oh, that reminds me of my stint representing consumers before the Alaska Public Utilities Commission back in the mid-80s!  PURPA and all that.....) here.

The firm has three basic options to think about:

-They'll install the panels and guarantee electricity production, and will charge you monthly "rent" for the panels.  This rent is more than offset by your guaranteed electric bill savings.

-Or you can pre-pay the lease agreement in a lump sum, and then your bill savings are your bill savings.  We're paying about $8000 upfront for the system in exchange for a guaranteed $105/mo in electric bill savings (at today's current electricity rates; as the rates increase over time, the savings, and thus the return on investment, increase).

-Or you can buy the system outright, fuss with the state and federal rebate processes, take care of repairs yourself, and hope that the electricity generated is what Sungevity estimated.  More risk, and more paperwork.

We went with option 2.

More when they get on the roof--

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