Solar panels use the photovoltaic effect, discovered by Edmund Becquerel in 1839, to
produce electricity directly from sunlight. Solar panels contain a series of Solar cells
which converts the energy in light into electrical energy through the process of photovoltaics.
Solar panels work best in direct sunshine, but they also work even on cloudy days at
a reduced output. Solar PV systems work in almost any application and are available
now to start changing the way we live. Even with panels not placed in a southerly direction
but on an east or west facing roof you can still obtain about 92% of the rated output.
There aren’t many alternative energy solutions that are as easy to install and
only take up existing constructed areas and have no moving parts that would need costly
servicing.
With increasing energy demands and the depletion of fossil fuels Solar PV Panels are
now a real and needed alternative to conventional electricity generation. One of the
biggest misconceptions is that PV systems are too expensive, or they cannot be afforded.
Some feel they cannot justify the expense of a PV system when they can continue to make
a “smaller” payment to the utility company every month. Others feel the
impact the Solar PV System will have on their life is not significant enough to justify
making such a large purchase. While others believe they should wait until the technology
has improved or becomes more efficient before installing a PV system.
Understandably, many feel they cannot afford a Solar PV system or they believe it does
not make financial sense. Without being given accurate education or information these
opinions are absolutely reasonable. Our government now recognizes the need for an alternative
energy solution and has begun to offset many of the costs associated with PV systems
by offering tax credits and funding through state grants. In February 2009 President
Obama signed the Recovery and Reinvestment Act of 2009 to add, maintain, and in some
cases increase funding available for residential and commercial alternative energy projects.
At the federal level a 30% tax credit is available after all State grants have been
applied. (energystar.gov) In addition to the tax credit the state of Ohio offers grant
funding at $3 per watt with a $25,000 maximum for residential PV projects and $150,000
maximum for commercial PV projects. (Ohio.gov, Energy Department)
So what does this mean in terms of cost for an average residential system? The average
PV system cost is $6-$10 per watt. If you assume your average household use is 800 kWh
per month and you chose to install a system that would offset your electricity demands
by 100% you would require an 8 kilowatt PV system. If you purchased a system of this
size at $6 per watt would be $48,000. Using Ohio Grant funding you would deduct $24,000
leaving you with the responsibility of $24,000. The Federal government then offers a
30% tax credit of $7,200. This leaves $16,800 paid by you after all grant money has
been released and tax credits have been taken. If you were to pay this with an equity
line at 5% for 30 yrs your monthly payment would be approximately $90 per month. At
10 cents per kilowatt hour which is the current Duke Energy charge in many areas with
taxes and other misc “stuff” on your current electric bill you are paying
that much now. So people are already “affording” solar now! This does not
even take into account the fact that our electricity is becoming more expensive to generate
every year. Not to mention the environmental and social cost associated with pollution,
smog etc that we all are breathing every day due to our current fossil fuel burning.
With that kind of return on investment the system can be paid off long before it will
need replaced.
Many people debate at what rate the cost of energy will increase per year. A conservative
average is 4.5% per year. (Public Utilities Commission). At this rate a current bill
of $90 per month would increase (on average) to $94.05 in the first year and exponentially
more thereafter. What is typically forgotten is that in order to get an accurate number
you must add the 4.5% or whatever the rate of increase, to the previous year and so
on. Return on investment is usually assumed that the rate of increase will stay at a
minimum. With fossil fuel depletion and gasoline reaching all time highs it is my opinion
that this yearly increase will pass the 4.5% mark much sooner than that! In addition
to decreasing your energy bill, lessoning your carbon footprint and investing in a sustainable
energy future you are also adding significant value to your home. For every $1.00 in
annual utility savings, your home value will increase by $20.00. This means, installing
an 8 kilo watt system would increase your property value by $19,200 which is roughly
what would be invested. (National Appraisal Journal) This means that not only are you
paying into a system that will eventually pay you if you stay in that home but that
you are creating equity that can be recouped when selling your home as well!
Utility Companies often offer their customers even billing. The benefit in evening billing
is the guarantee your utility bill will remain the same, this holds true for PV Solar
systems as well. You will have one payment per month that is guaranteed to not go up
even as the cost of conventional electricity rises, unless of course your monthly kWh
usage was to increase. As products become more energy efficient by design this will
only increase the probability that our energy usage will remain a constant as we obtain
more energy consuming devices. For many people they feel there is a freedom associated
with not having to be concerned with the price of electricity increasing because their
bill will remain a constant. It is one of the only guaranteed investments out there.
One could argue that they could invest the same money “energy” related stocks
in stock market but none of those investments have guaranteed returns. Another great
benefit to a PV system is it starts paying for itself the day it is commissioned. Many
of today’s systems have a 50 year plus life expectancy; this will guarantee they
will be paid off long before they are obsolete. Many people seek to own a home verses
renting, this holds true for an electricity generating system as well. The issue people
have with renting is that money is being invested in someone else’s pocket. When
you purchase a system that you or the next homeowner can take advantage of and will
ultimately be paid off and start paying a profit to the homeowner that is truly an exciting
and sustainable proposition. Owning a PV system not only gives you the control of how
much you will pay per month for energy, it also creates equity for a secure future.
With all of the advances in technology today it is no wonder that some people believe
they need to wait until the Solar Panel technology has progressed. We have been conditioned
to expect our electrical devices to be obsolete in a couple years needing to be replaced
or upgraded. This does not hold true for Solar Panels. The effectiveness of Solar panels
is predicted to increase by a mere 2-3% over the next 10-15 years. (Solar Buzz Report,
2005) This is highly insignificant considering the predictions for price increases of
electricity 10-15 years from now and the time you would have lost building equity in
your PV system.
While a PV system is operating it has virtually no impact on the environment. It produces
no pollution. By producing no pollution it is not creating greenhouse gases so it does
not contribute to global warming, this is the most important point. It burns no fuel
and has no moving parts. It does not create hazardous waste or noise pollution, unlike
conventional energy sources. During production of the panels minimal chemicals are used
but are disposed of following state and federal environmental laws. The waste created
in production of a solar panel is negligible to that which is created while producing
conventional energy.
Use the example of an 800 kilowatt system you will see the impact this system will have
on the environment as well as your wallet. This system will have a major role in reducing
your carbon footprint as well as global warming. Over a one year period an 800 kilowatt
per month / 9600 kilo watt per year system will reduce annual greenhouse gas emission
(carbon dioxide) by 13666.5 pounds. This is equivalent to removing one car from the
road and saving 1.75 acres of forest. A 2-3% efficiency improvement does not increase
these numbers by enough to warrant waiting for technology that does not have much room
for improvement. With the proven decrease in resources for fossil fuels this is the
perfect time to begin changing our mindset, saving money and our planet with a PV Solar
System.
Work Cited
www.energystar.gov Tax Credits for Energy Efficiency
May 26, 2009
www.odod.state.oh.us/cdd/oee/ELFGrant.htm
Residential Solar Photovoltaic Energy Incentive (NOFA 09-04)
www.grosolar.com National Appraisal Journal, received
article from groSolar (no other information available)
www.grosolar.com Solar Buzz Report 2005, received information
from groSolar (no other information available)
