After weeks of barely any progress waiting on permits and red tape we are finally starting install tomorrow, January 31st! Only 2.5 months after signing on our system! The vendor Yellowlite sub-contracted the install to a local vendor, Strawberry Solar, and things get underway at 10 am. Install will be completed by Thursday but then we must wait on city electrical inspection and DTE inspection before our production will be underway... In the meantime on to my next blog post.
Image courtesy of CPI:
Most states have laws governing solar panels and power production. Utility providers have goals to meet in providing clean energy. One of the ways they do so is allowing customers to purchase solar panel systems and feed energy back to the grid. This benefits the utility company in three ways:
1) It takes the investment in the panels away from the utility company and puts it on the customer.
2) The clean energy produced by your solar panels counts towards the utility companies clean energy goal.
3) Any excess energy produced cannot be carried over year to year.
The laws in place governing solar energy are not friendly to private citizens that produce electricity and, for the most part, favor the utility companies. In Michigan if you are already connected to a utility company that provides electric, you cannot disconnect from the company and produce your power 100%. You also cannot utilize a battery backup to store excess energy as it must be fed back to the grid. The system to credit this energy production on your electric bill has been labeled Net Metering and this is the method the majority of states have adopted. Net Metering as shown in the graphic uses a bi-directional meter to count the watts your solar panels produce and the watts your home uses. It then credits the excess energy sent to the grid on your energy bill. Your electric bill will only charge you for the watts used over your solar energy production.
To be completely off the grid you must build a new home that has never been connected to a utility company. This would not apply to a tear down and rebuild but it would apply to a lot that was split with an old home and a new home, with new service. The new home would be able to be off the grid by purchasing a solar system with a battery backup. The battery systems that come with solar panels are quite expensive and once the life of the battery is up they must be disposed of. The bright side of adding solar after already having an electric utility provider is that the large battery investment is not needed and there is no need to eventually worry about battery disposal.
Another question might be what happens when there is a power outage? Unfortunately, without a battery system when the grid goes down your solar production will continue but will cease to be Net Metered to prevent damage to the grid and the power will still go out. There are small battery backup systems that can be used to store your power and prevent a power outage at your home. These systems are allowed to work with a grid connected home solar system. In the event of a power outage you would flip a manual switch to allow your system to begin sending power to the battery backup system that can keep your home powered for a short period of time. However, such a system would need to be started during daylight hours and have active energy production to prevent having the power out. The cost of this setup would far outweigh the cost of a generator for use in such times.
After reading all this you might think "why go solar?" Obviously the number 1 reason is that it is the green thing to do and an excellent step in reducing your households carbon footprint. Another reason is that Net Metering looks at 1 watt of energy production as 1 watt of energy production. This correlation will not change over the 25 plus life span of your solar energy system. In Michigan electric costs are currently 15.7 cents per watt in 2017 up from 12.11 cents per watt in 2011. This is roughly a 29% increase in 6 years or approximately 4.9% increase per year. If this trend continues a solar system will provide an excellent return on investment as the value of energy produced would not be subject to the price increase on electric. Personally, for my household the cost of going solar will not cost more than my monthly electric bill. After the 30% federal tax reduction for going solar the loan payment will be equal to what we would pay in electric costs. If electric rates continue to increase, we will see a monthly payment reduction. In 11 years the solar system will be paid off and there will still be 14 plus years of use left to the system. At that point our electric bill will be 80% or less than it would be without solar panels at that point it is pure return on investment. Another point to mention is that solar panels are an investment in your home no matter if you plan to live there 2 years or 50 years. The research I found regarding home value after solar panel install notes that a homes value will increase 10 to 15 times the annual savings on your electric bill. So if a solar system saves $1000 per year on the electric bill you can expect the home value to increase approximately $10,000. Not a bad investment for producing clean energy!
Solar power is a household decision and can be catered to fit all needs, budgets and uses. Personally, I would hope that everyone would want to go solar. I am blogging about it in hopes of getting the word out with our experience on solar and possibly encourage those thinking about it to go for it. I did create an excel file, that after entering pertinent information, can help you estimate money savings over the life of a solar system. If I can I will try to add the spreadsheet with instructions for download. More to follow on that...
DTE and other electric providers will not let you install a system that is estimated to over produce your average annual usage. This is because they do not want excess production and the system is set up so that DTE wipes your energy credits clean at the start of the new year. So over producing is not necessarily advantageous to you and it would mostly benefit your electric company because they get free energy from your system. Potentially, at the end of the year, before the credits are wiped, if you have a credit of excess production you can call and request a cash out. I have not tried this so I can neither confirm or deny this claim but I will hopefully be able to eventually verify this once my panels are installed.
Another question might be what happens when there is a power outage? Unfortunately, without a battery system when the grid goes down your solar production will continue but will cease to be Net Metered to prevent damage to the grid and the power will still go out. There are small battery backup systems that can be used to store your power and prevent a power outage at your home. These systems are allowed to work with a grid connected home solar system. In the event of a power outage you would flip a manual switch to allow your system to begin sending power to the battery backup system that can keep your home powered for a short period of time. However, such a system would need to be started during daylight hours and have active energy production to prevent having the power out. The cost of this setup would far outweigh the cost of a generator for use in such times.
After reading all this you might think "why go solar?" Obviously the number 1 reason is that it is the green thing to do and an excellent step in reducing your households carbon footprint. Another reason is that Net Metering looks at 1 watt of energy production as 1 watt of energy production. This correlation will not change over the 25 plus life span of your solar energy system. In Michigan electric costs are currently 15.7 cents per watt in 2017 up from 12.11 cents per watt in 2011. This is roughly a 29% increase in 6 years or approximately 4.9% increase per year. If this trend continues a solar system will provide an excellent return on investment as the value of energy produced would not be subject to the price increase on electric. Personally, for my household the cost of going solar will not cost more than my monthly electric bill. After the 30% federal tax reduction for going solar the loan payment will be equal to what we would pay in electric costs. If electric rates continue to increase, we will see a monthly payment reduction. In 11 years the solar system will be paid off and there will still be 14 plus years of use left to the system. At that point our electric bill will be 80% or less than it would be without solar panels at that point it is pure return on investment. Another point to mention is that solar panels are an investment in your home no matter if you plan to live there 2 years or 50 years. The research I found regarding home value after solar panel install notes that a homes value will increase 10 to 15 times the annual savings on your electric bill. So if a solar system saves $1000 per year on the electric bill you can expect the home value to increase approximately $10,000. Not a bad investment for producing clean energy!
Solar power is a household decision and can be catered to fit all needs, budgets and uses. Personally, I would hope that everyone would want to go solar. I am blogging about it in hopes of getting the word out with our experience on solar and possibly encourage those thinking about it to go for it. I did create an excel file, that after entering pertinent information, can help you estimate money savings over the life of a solar system. If I can I will try to add the spreadsheet with instructions for download. More to follow on that...
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