Robert,
the analysis depends on the volume of kWhs you use, your local
utility's rate structure, plus, as you noted, the local tax credits, and,
finally, the rules under your regulatory regime about interconnection with the
utility and the rates (if any) the utility will pay for power you supply to it.
In California, until just now, residential consumers using a fairly large
amount per month paid a high price per unit. (The price goes up in steps as
you use more.) That rate design is changing because those large users -- very
profitable users -- were installing solar and the utilities were suffering.
And with those users being subsidized, as you described, the other customers
were disadvantaged.
The situation is being fought out around the country and you should get local
advice.
The utilities are facing what some are calling a death spiral. As individual
customers remain connected to the system, for night time energy, for cloudy
days, etc. but are no longer buying many kWhs and, besides, sometimes selling
excess to the utility, which is forced by rules to buy from them, the utilities
are frantically trying to devise rules so that these customers --- along with
the rest -- pay a fair share to support the poles and wires by which they are
connected. This is likely, almost certainly, to result in a high monthly
charge to simply be connected to the system, whether you use energy or not. So
a couple in a small apartment might be hit with a $20 or $25 charge before
adding charges for the energy they use. This is going to hit hard on small
users. And there is a correlation between income and use. The $20 spread over
a couple of thousand kWhs is quite different if spread over 300.
One other wrinkle: There are plenty of vendors eager to finance the panels in
the way you describe. But to raise the cash for the large investments to
connect many customers, the vendor needs to raise cash from a bank or other
lender. For that reason they need to restrict their offers to people with good
credit, so the bank will take the paper as collateral for the loan. So this is
one more reason this whole mania favors the richer over the poorer customers.
One of Elon Musk's (the man behind Tesla and other things) companies, Solar
City, is very active in this business. I'm told they have a high cutoff on
credit scores for people they offer to deal with.
Good luck.
Gene
On Nov 2, 2013, at 1:12 PM, Robert Naiman wrote:
> I'm thinking about putting solar panels on my house.
>
> A friend of a friend puts solar panels on people's houses, so I asked him for
> an estimate.
>
> According to his estimate, it will cost $13,000 to put solar panels on my
> house that are supposed to be good for 25 years.
>
> There is a 30% federal tax credit, so that amounts to about $10,000.
>
> According to his estimate, this will pay for itself through reduced utility
> bills over 10 years.
>
> So, it seems to me, the only reason that somebody who owns a house and wants
> to reduce their carbon footprint wouldn't do this is that they don't have
> $10,000 available.
>
> Why shouldn't we have a green energy credit union that says to people, you
> want to put solar panels on your house, we'll lend you the $10,000. You pay
> us back over the next ten years. So, this will essentially cost you nothing.
> After your loan is paid off, you have 15 years of cheaper energy for your
> house. And the whole time you're reducing your carbon footprint. For free.
>
> ?
>
> Note that in states and cities that give incentives on top of the federal
> incentive, this should be even easier. My city and state don't do this. But
> in Los Angeles, a friend of mine who had solar panels put on his house said
> it didn't cost him a dime, because there are local and state subsidies, and
> there is a company that does everything for you: installs the panels,
> collects all the subsidies on your behalf, and sells you the panels on a rent
> to own basis so that no cash ever leaves your hands, so it's essentially
> acting as your bank and paying itself back out of your reduced utility bills.
> Or, looked at another way, it's a power company whose power generators are on
> top of people's houses. So Los Angeles, apparently, is taken care of. What
> about everywhere else?
>
> --
> Robert Naiman
> Policy Director
> Just Foreign Policy
> www.justforeignpolicy.org
> [email protected]
>
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