Solar payoff....worth it?

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Check out mysolarpod.com. They sell a ground based system you could install yourself once you get a sub-panel wired to the site. You can also go on the enphase web store and see how much all the hardware costs. Of course a solar company probably gets better prices. I think a large system could be done at about $2/w. 1 watt of capacity might make 3whr of power in a day if optimally situated. Don’t know if you can get the cost low enough given cheap electricty you can buy.

I'm still gathering quotes. Last one was $45000 +/- Not going in a good direction LOL
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Had a guy stop by for a bid and he managed to piss me off before he even got out of his car. TN does not have net metering so everything will be done behind the meter. He kept telling me that the meter was too far from the house and with the array being further in the opposite direction there would be too much power degradation so I would have to add extra panels just to make up for the loss.

Never asked me what my expectations were or how big a system I was interested in. I tried to explain what the last 2 bidders quoted for me and that they made no mention of a meter being too far away. His answer was "I've been doing this for 15yrs, I know what I'm doing."

I told him he was wasting my time, not to bother getting out of his car and just leave.

Some peoples kids......jeez
 
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Incase anyone cares our meter is located on a pole on the road just before our driveway........guessing 800 feet or so from the electrical panel on the house.
 

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Had a guy stop by for a bid and he managed to piss me off before he even got out of his car. TN does not have net metering so everything will be done behind the meter. He kept telling me that the meter was too far from the house and with the array being further in the opposite direction there would be too much power degradation so I would have to add extra panels just to make up for the loss.

Never asked me what my expectations were or how big a system I was interested in. I tried to explain what the last 2 bidders quoted for me and that they made no mention of a meter being too far away. His answer was "I've been doing this for 15yrs, I know what I'm doing."

I told him he was wasting my time, not to bother getting out of his car and just leave.

Some peoples kids......jeez
Without net metering it is hard to make solar financially viable. Maybe in 5 yrs batteries will come down in price to change the economics.
 

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Perhaps look at ROI: Where can you get $5000 TAX FREE and RISK FREE return on $74k net investment? That works out to nearly 7% investment return - year after year, without paying taxes on that 7%. Stock dividends? Nope, they are taxable. Bonds? Nope, they are much less return and risky. Pretty good investment in your own home IMHO. Was it a solar roof?
Sorry but this is just wrong.

This is NOT a 7% tax free return and cannot be compared to other investments.

This is also the same confusing math that annuity salespeople use to confuse people sometimes.

There is a very large difference between a 7% return ON your money and a 7% return OF your money.

7% return on your money- you invest 100,000. At the end of 10 years you have $170,000 (simple interest) or about $200,000 (compound interest).

7% return of your money- you invest 100,000. At the end of 10 years you have 70,000. (You actually lost $30,000)

The reason people keep taking about the break even point is that’s the number of years it takes to get your original investment back. (I.E. a zero percent return).

In the case of a 20 yr payback, it takes 40 years to “double” your money. Divide into 72 to get your rate of return and it’s less than 2% (less than inflation). This is not a money maker.

Even with a 10 yr payback (20 yrs to double your money), it equates to a little over 3% return.

This is not an investment and shouldn’t be compared to one.
 


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What relevance does years of payback have? Use Return on Investment - and compare your savings with any other investment that yields a TAX FREE return! Your utility bills are paid with after-tax dollars. Wake up, folks! Years of payback is a useless and misleading payback measure. And, the feeling that you have reduced your GHG emissions that run your home - Priceless!!
Wrong again. See above response.

You’re ignoring the principal (money invested) of a regular investment.

In a regular investment, you get the returns or interest PLUS you still have the original investment money.

In the case of the panels, they will eventually be worthless.
 

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Yes, that is what I got based on your early numbers. " using your numbers, you estimate $950 annual savings on a $22,000 investment. That works out to 4.3% TAX FREE rate of return on net invested capital. " Keeping in mind that also includes battery on-site, that is actually pretty good, IMHO.
In this example here is the actual rate of return-

Before 23 years- loss

At 23 years- 0% return

At 46 years- 1.5% return.

It takes 23 years to get your $22,000 back. That’s why it’s a zero percent return at 23 years.
 

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I have a bid from a solar install company for 7.6kw system. Included is 9kw battery backup, 7.6kw inverter, all racking for a ground mount, wiring and trenching, installed comes to about $30000.
The battery backup cost is killing your return....
get a quote for the system without the 9kW battery backup.... I'll bet it is close $10k-$15k less

Then, lets say your Gross cost comes down to $20k gross, - 26% Fed ITC = $14.8k net investment
... the 7.6kW system *should* produce about 13000 kWhr/yr = $1300 worth of electricity annually

Two ways to look at this are:

- raw 'payback time' = $14800/$1300 = 11.4 years ... or less since the 'retail cost' of electricity goes up by 4%-5% annually in most parts of the county. so thats like doubling your money in 10 years... which is 10% ROI on your net investment.... which is better than most people do with any investments, especially on low-risk investments. Even better when you realize this ROI is pure savings on what you would otherwise pay out; not capital gain that you'd have to pay taxes on!

- warranteed production value... depends on the quality of PV modules you were quoted. The average Chinese/India panels have a 10 or 12 year production warranty, and degrade at about 0.6% per year. Giving worst case warranteed production value of 10 yrs x $1300, and barely paying off your net investment when they drop out of warranty and basically have no appraisal value. If you insist on Premium modules (like REC, LG, Panasonic, or Sunpower with actual 25 year transferrable parts and labor warranty), you will at least double your investment, regardless when you sell the home.

What a great deal! If 10% annual ROI with low risk (or better every time the cost of Electricity goes up) isn't good enough for you, then please post what you think is a better investment.

Solar is a financial win as well as environmental, AND improves Grid Resiliancy in case of outages. Much better than running your electric car on coal, nuke, Natural gas which is still the bulk of Utility power....

Back to the battery backup....

You presumably now have a Mach-e with over 60kWhr of energy on board.... why buy more batteries? Just buy a decent pure-sine Inverter, hook it up to your 12v connection points, and (after turning off your main disconnect to isolate from the grid, and turning off your grid-tied PV) you COULD backfeed power from your Mach-e to run your house as long as you don't exceed the capacity of the Inverter, and the 'refill rate' of the Mach-e dc-dc to keep the 12v battery up.... which is about 2000 watts continuous load.
 
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The reason for the battery is, no Net Metering in TN. So rather than overproduce with no payback, store the excess in the battery for use later.

7.6kwh system will pay about half of our utility bill. So, for grins and giggles, I'm going to get a price for double that, 15kwh, and no battery and see where we land. 15kwh will cover all of our electric bill and then some. No storage incase of power outage in this case
 

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The reason for the battery is, no Net Metering in TN. So rather than overproduce with no payback, store the excess in the battery for use later.

7.6kwh system will pay about half of our utility bill. So, for grins and giggles, I'm going to get a price for double that, 15kwh, and no battery and see where we land. 15kwh will cover all of our electric bill and then some. No storage incase of power outage in this case

So Really? TN Interconnection does not allow export of energy from Homeowner to Grid?

That sucks, because it does extend the 'payback' and reduce the ROI.... but it does add the benefit of backup during outages.

In some places like HI where they have a very high percentage of home with Solar, they basically do not allow export of daytime excess, and if you want PV, you HAVE to get a system with battery to capture excess. It increases the system cost by at least $15k, but builds in battery backup in case of outage, which is a nice benefit.

In *most areas*, as long as they allow grid-tied interconnection, you ARE GETTING 'net metering' at retail rate daily. i.e you don't need a battery because your excess energy from the day spins the meter backward, and comes back in at night.

In *some areas*, when there gets to be too much Solar co-gen in a given area, the Utilities either require the Homeowner to design the system with batteries to capture daytime surplus or they are starting to add battery 'buffers' on the Utility side of the meter to even out their baseload from the Transmission side while providing capacity for nightime and/or bad weather
 
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So Really? TN Interconnection does not allow export of energy from Homeowner to Grid?

That sucks, because it does extend the 'payback' and reduce the ROI.... but it does add the benefit of backup during outages.

In some places like HI where they have a very high percentage of home with Solar, they basically do not allow export of daytime excess, and if you want PV, you HAVE to get a system with battery to capture excess. It increases the system cost by at least $15k, but builds in battery backup in case of outage, which is a nice benefit.

In *most areas*, as long as they allow grid-tied interconnection, you ARE GETTING 'net metering' at retail rate daily. i.e you don't need a battery because your excess energy from the day spins the meter backward, and comes back in at night.

In *some areas*, when there gets to be too much Solar co-gen in a given area, the Utilities either require the Homeowner to design the system with batteries to capture daytime surplus or they are starting to add battery 'buffers' on the Utility side of the meter to even out their baseload from the Transmission side while providing capacity for nightime and/or bad weather
The install here will be behind the meter with no ability to push out to the grid. It's controlled by TVA, TN Valley Authority, regardless of your power delivery company. If we were to install a meter to feed the grid we would only be paid 2cents/kwh so I'm told it's not worth the hassle and the suggestion was to add the battery to capture any excess and have that backup in an outage, even tho 9kwh is a pretty small backup.

Anyway, we are still researching our options and nothing will be decide till after the new year.
 

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The battery backup cost is killing your return....
get a quote for the system without the 9kW battery backup.... I'll bet it is close $10k-$15k less

Then, lets say your Gross cost comes down to $20k gross, - 26% Fed ITC = $14.8k net investment
... the 7.6kW system *should* produce about 13000 kWhr/yr = $1300 worth of electricity annually

Two ways to look at this are:

- raw 'payback time' = $14800/$1300 = 11.4 years ... or less since the 'retail cost' of electricity goes up by 4%-5% annually in most parts of the county. so thats like doubling your money in 10 years... which is 10% ROI on your net investment.... which is better than most people do with any investments, especially on low-risk investments. Even better when you realize this ROI is pure savings on what you would otherwise pay out; not capital gain that you'd have to pay taxes on!

- warranteed production value... depends on the quality of PV modules you were quoted. The average Chinese/India panels have a 10 or 12 year production warranty, and degrade at about 0.6% per year. Giving worst case warranteed production value of 10 yrs x $1300, and barely paying off your net investment when they drop out of warranty and basically have no appraisal value. If you insist on Premium modules (like REC, LG, Panasonic, or Sunpower with actual 25 year transferrable parts and labor warranty), you will at least double your investment, regardless when you sell the home.

What a great deal! If 10% annual ROI with low risk (or better every time the cost of Electricity goes up) isn't good enough for you, then please post what you think is a better investment.

Solar is a financial win as well as environmental, AND improves Grid Resiliancy in case of outages. Much better than running your electric car on coal, nuke, Natural gas which is still the bulk of Utility power....

Back to the battery backup....

You presumably now have a Mach-e with over 60kWhr of energy on board.... why buy more batteries? Just buy a decent pure-sine Inverter, hook it up to your 12v connection points, and (after turning off your main disconnect to isolate from the grid, and turning off your grid-tied PV) you COULD backfeed power from your Mach-e to run your house as long as you don't exceed the capacity of the Inverter, and the 'refill rate' of the Mach-e dc-dc to keep the 12v battery up.... which is about 2000 watts continuous load.
Nooooooooooo………

It is not like “doubling your money in 10 years.”

It’s “getting your money back in 10 years.”

If you give me $10,000, and at the end of 10 years I give you $10,000 back, you made zero dollars. And in fact because of inflation you LOST money. ($10,000 today is worth more than $10,000 will be in 10 years).

It would take 20 years to double your money. That’s a little over 3% return.

And at a 3% return, “take your pick” and there are much better investments out there.

Even if it doubled your money in 10 years (which it doesn’t), it would be a 7% return, not 10%. (Law of 72).
 

engnrng

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Sorry but this is just wrong.

This is NOT a 7% tax free return and cannot be compared to other investments.

This is also the same confusing math that annuity salespeople use to confuse people sometimes.

There is a very large difference between a 7% return ON your money and a 7% return OF your money.

7% return on your money- you invest 100,000. At the end of 10 years you have $170,000 (simple interest) or about $200,000 (compound interest).

7% return of your money- you invest 100,000. At the end of 10 years you have 70,000. (You actually lost $30,000)

The reason people keep taking about the break even point is that’s the number of years it takes to get your original investment back. (I.E. a zero percent return).

In the case of a 20 yr payback, it takes 40 years to “double” your money. Divide into 72 to get your rate of return and it’s less than 2% (less than inflation). This is not a money maker.

Even with a 10 yr payback (20 yrs to double your money), it equates to a little over 3% return.

This is not an investment and shouldn’t be compared to one.
Actually, my solar was absolutely an investment for me. All depends on how you want to view it. Is it a depreciating "asset" or does it generate cash flow to your bank account? Since it generates a significant cash flow savings, it was certainly not an "expense". I would have had to find a tax-free investment instrument yielding 7% to have the same affect on my personal cash flow.

Interesting what you can do with numbers. Don't know what you are basing either 10 years or 20 years or 40 years on: could you explain those out of thin air numbers? While they may be mathematically correct, what do they have to do with saving $7000 on utility bills given your example of a solar system costing $100,000 that still produces savings beyond year 25? If you have gotten a "return of" your $100,000 at less than 15 years, what is your rate of return "on" between year 15 and year 25? Infinite perhaps? What is $7,000 as a "return on" 0$ for year 15? The savings don't disappear when you have completed your "return of" original cost. They keep going like the Energizer bunny!

OK, let's take another look. $7000 that I save that first year can either be considered a "return of" and can be reinvested in other financial instruments pending the arrival of that "payback date", or can be considered a "return on" and can be reinvested in other instruments as long as the savings continue. Either way, the savings each year is tax-free since it is a savings of cash flow that I would have needed to pay with after-tax dollars if I did not have the solar. Let's use your original "cost" of $100,000 to make it easy. Since this is a cash flow exercise, I don't consider depreciation. So, assuming an increase in utility bills of about 5% per year and a drop in solar efficiency of 1% per year for an increase in utility savings each year of 4%, and assuming a paltry 2% after-tax return on my savings invested each year (from year 1 on to year 25), at the "end" of 11 years, I have my $100,000 back. However, at year 25, I am still saving $18,700 during that 25th year and I have a balance of over $360,000 by year 25. Certainly a "return of" my original $100,000 more than 3 times. Regardless of whether you call it "return of" or "return on", you still come out in pretty good shape! If the panels are generating a savings almost $19k in year 25, what is the value of that income stream at that time to either yourself or to a home buyer? I leave that to the student. Of course, there may be some states where electricity costs are not doubling every 8 to 10 years or so, but they have been in California where I live.
 

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Wrong again. See above response.

You’re ignoring the principal (money invested) of a regular investment.

In a regular investment, you get the returns or interest PLUS you still have the original investment money.

In the case of the panels, they will eventually be worthless.
How can they become worthless if they continue to generate savings in utility bills? How long to reach 75% of original efficiency? 25 years? I would probably replace them or add more if output dropped to 75% or so... Worthless? Why? Only if they stop producing completely...
 

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Nooooooooooo………

It is not like “doubling your money in 10 years.”

It’s “getting your money back in 10 years.”

If you give me $10,000, and at the end of 10 years I give you $10,000 back, you made zero dollars. And in fact because of inflation you LOST money. ($10,000 today is worth more than $10,000 will be in 10 years).

It would take 20 years to double your money. That’s a little over 3% return.

And at a 3% return, “take your pick” and there are much better investments out there.

Even if it doubled your money in 10 years (which it doesn’t), it would be a 7% return, not 10%. (Law of 72).
Don't savings continue after the 10 years? They don't magically stop just because you have "recovered" your cost. Now I see what you are leaving out!
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