Tell me why PV systems are not a scam

[wwhitney]

The difference in price between what my company charges for an under 4kW and over 6kW is only about 12 percent.

Do you mean price per watt?

Cheers, Wayne

 

[gadfly56]

You have not been paying attention. Residential solar costs about 8cents a kWh at contracting prices, maybe 11-12 in his case. Now, I still don't know what he gets paid for exporting to the grid. But if it were 15 cents then a system that lasts twenty-five years would take about 11/15*25years = 18 years to pay itself back. Now I'm not saying that would make it a great investment, but the ROI well under infinity.

System size isn't the biggest factor either. The difference in price between what my company charges for an under 4kW and over 6kW is only about 12 percent.

People are sure talking a lot on this thread without showing their work.

The actual cost of electricity is likely in the range of $0.07 if the all-in cost is $0.15, if my case is anything like typical. The balance is for infrastructure charges. Now the ROI is 36 years, about 11 past the useful life of the array if the POCO meters back at the retail cost of the electrons. If it's at the wholesale cost, expect an even longer payback period.

If it's on the roof, it's likely to need to be taken down and reinstalled somewhere between years 15 and 25 so the roof can be replaced.

By the way, what exactly is included in that price of $0.08/kW-hr? Scanning prices on the web, that gets you the panels dropped in your driveway and that's it. Selling just to sparkies isn't going to be a very sustainable business model.

 

[winnie]

The actual cost of electricity is likely in the range of $0.07 if the all-in cost is $0.15, if my case is anything like typical. The balance is for infrastructure charges. Now the ROI is 36 years, about 11 past the useful life of the array if the POCO meters back at the retail cost of the electrons. If it's at the wholesale cost, expect an even longer payback period.

In many locations, the way 'net metering' is that you get charged for your _net_ energy use each billing period. Say you use 500kWh and your system produces 400kWh; you get charged for 100kWh. This means that the value of your solar production is essentially the full retail price including both cost of electricity and infrastructure charges. In your calculation above you would use the full $0.15 for any electricity you actually use.

IMHO this is one of the more unfair subsidies; you could produce all of your energy during the day, use it all at night, and not pay a dime for the transmission costs of that energy. But if we are specifically discussing the economics of solar power given the current regulatory structure, then the rules of the existing regulatory structure are what matter.

-Jon

 

[electrofelon]

In many locations, the way 'net metering' is that you get charged for your _net_ energy use each billing period. Say you use 500kWh and your system produces 400kWh; you get charged for 100kWh. This means that the value of your solar production is essentially the full retail price including both cost of electricity and infrastructure charges. In your calculation above you would use the full $0.15 for any electricity you actually use.

IMHO this is one of the more unfair subsidies; you could produce all of your energy during the day, use it all at night, and not pay a dime for the transmission costs of that energy. But if we are specifically discussing the economics of solar power given the current regulatory structure, then the rules of the existing regulatory structure are what matter.

-Jon

I Agree it is sort of "unfair" that I get to use the grid as my free 100% efficient battery. I would be ok with some sort of fee for this, or perhaps still have to pay the transmission component of the charge. OF course, you effectively still get 100% free net metering when you are using more that you are making, which for many commercial systems is most/all of the time.

 

[gadfly56]

I Agree it is sort of "unfair" that I get to use the grid as my free 100% efficient battery. I would be ok with some sort of fee for this, or perhaps still have to pay the transmission component of the charge. OF course, you effectively still get 100% free net metering when you are using more that you are making, which for many commercial systems is most/all of the time.

Yes, but commercial is different from residential. In NJ, IIRC, you can't get paid for more than 100% of what you consume. If you use 8,000 kW-hr per year and pump back 10,000 kW-hr per year, the POCO gets 2,000 kW-hr for free.

 

[ggunn]

In many locations, the way 'net metering' is that you get charged for your _net_ energy use each billing period. Say you use 500kWh and your system produces 400kWh; you get charged for 100kWh. This means that the value of your solar production is essentially the full retail price including both cost of electricity and infrastructure charges. In your calculation above you would use the full $0.15 for any electricity you actually use.

IMHO this is one of the more unfair subsidies; you could produce all of your energy during the day, use it all at night, and not pay a dime for the transmission costs of that energy. But if we are specifically discussing the economics of solar power given the current regulatory structure, then the rules of the existing regulatory structure are what matter.

-Jon

Unfair to whom? The energy that is being produced by a PV system during the day reduces the load on the grid whether it is being used on site or being exported, and the time of day when a typical PV system is producing the most power often coincides with when the load on the grid is the greatest - mid to late afternoon when air conditioning demand is the highest. Every kWh it produces is one fewer that the utility has to go out to purchase on the spot market if their generation falls short of demand, and it is during the time of day when spot prices typically spike. This is good for everyone.

 

[electrofelon]

Yes, but commercial is different from residential. In NJ, IIRC, you can't get paid for more than 100% of what you consume. If you use 8,000 kW-hr per year and pump back 10,000 kW-hr per year, the POCO gets 2,000 kW-hr for free.

What I was trying to say is if you have a base load during solar/business hours equal to or greater than your pv system, net metering doesn't matter (except maybe holidays and weekends)

 

[Besoeker]

For me, the problem with solar (and wind) is variability. Not much you can do to reverse calm, dark nights. Or repel dark knights......

 

[ggunn]

For me, the problem with solar (and wind) is variability. Not much you can do to reverse calm, dark nights. Or repel dark knights......

That's why solar and wind without utility scale storage are never touted as the one solution. Natural gas power plants and nukes will be around for quite a while yet.

 

[jaggedben]

Do you mean price per watt?


Cheers, Wayne

Yes.

...
By the way, what exactly is included in that price of $0.08/kW-hr? Scanning prices on the web, that gets you the panels dropped in your driveway and that's it. Selling just to sparkies isn't going to be a very sustainable business model.

Levelized cost of electricity (LCOE) = cost per watt / kWh per watt per year / lifetime of system

Around here, average for those numbers would be something like $3.10 per watt, 1.5kWh per watt per year, and we're assuming 25 years.

$310/1.5/25 = 0.083

I can't imagine that you'd have to pay $3.10/W to get the panels dropped in your driveway. Should be around a dollar, with the new tarrifs, depending on how high end you want to go. Inverters and racking shouldn't cost you more than another 50 cents for a 10kW system. If you're an electrician, ask around at distributors instead of scanning the web.

 

[gadfly56]

Yes.



Levelized cost of electricity (LCOE) = cost per watt / kWh per watt per year / lifetime of system

Around here, average for those numbers would be something like $3.10 per watt, 1.5kWh per watt per year, and we're assuming 25 years.

$310/1.5/25 = 0.083

I can't imagine that you'd have to pay $3.10/W to get the panels dropped in your driveway. Should be around a dollar, with the new tarrifs, depending on how high end you want to go. Inverters and racking shouldn't cost you more than another 50 cents for a 10kW system. If you're an electrician, ask around at distributors instead of scanning the web.

I missed that you were quoting per kW-hr, not kW. I was looking at cost per installed watt.

 

[Besoeker]

That's why solar and wind without utility scale storage are never touted as the one solution. Natural gas power plants and nukes will be around for quite a while yet.

Agreed.
Utility scale storage is a point I have brought up here and other "green" forums.
Hydro is a renewable with storage.

 

[ggunn]

Agreed.
Utility scale storage is a point I have brought up here and other "green" forums.
Hydro is a renewable with storage.

But the lack of storage is no reason to assume that solar and wind cannot be valuable contributors to the mosaic which is the energy picture of the present and future.

 

[Besoeker]

But the lack of storage is no reason to assume that solar and wind cannot be valuable contributors to the mosaic which is the energy picture of the present and future.

Agreed which is why I would make no such assumption.