Solar Electric System Basics
Photovoltaic (PV) cells convert the sun’s rays directly into electricity. The equipment required for this process has no moving parts and so requires minimal maintenance. Typically, flat-plate panels of PV cells are mounted on a south-facing roof. The power is routed through an inverter which converts it from DC to AC for use in the home. When you generate more electricity than you use, the excess is fed into the electrical utility’s grid. By using the grid for electrical storage system, you eliminate the need for costly storage/backup batteries.
“Batteries are now an optional part of a solar electric system, necessary only if backup power is required,” says Blunt. “The grid is online 99.9% of the time, and is the most efficient storage medium for solar power.”
The electrical output of a PV cell is dependent upon the intensity of light to which it is exposed. So PV cells will tend to generate more electricity on bright days than when skies are overcast. However, solar electric systems do not need to be in direct sunlight to work, so even on overcast days these systems generate power.
Sizing Your System
The average household in California uses about 6,700 kilowatt hours (kWh) of electricity a year. Typically, a 1 kW solar electric system will produce about 1,500 kWh a year. Most residential systems range between 2.5 and 4.5 kilowatts (kW).
Beware of averages though. 1.2 to 3 kW systems are common near the coast on smaller urban properties; and 4 to 11 kW can be found on hotter inland properties or on larger-sized properties.
Your system size will depend on your needs and how much electricity you want to generate. To estimate what size system you might need, use one of the solar estimators available on the web. The Solar Estimator at www.findsolar.com/index.php?page=rightforme will provide a general idea of system size, price, and savings. Since the cells are arranged in panels, a solar electric system can easily be sized to fit your needs.
“In sizing your system, the most economical approach to take is to size your system to get yourself out of the highest energy rate tiers,” says Lind. “The more electricity you use the more you pay at the higher tiers, so the larger your system should be.” (Note: Tiered billing is explained below in “Cost and Cost Effectiveness.”) Lind adds that sizing the system to meet 60-70% of usage is a common approach.
Locating Your System
100 square feet of panels will generate about one kW. Since most home systems are between 2.5 and 4.5 kW, you will need from 250 to 450 square feet for the panels. Thin-film solar technology requires twice as much space, so one kW takes 200 square feet.
The location should be unshaded roof or ground. Panels that face due south will produce the most kilowatt hours. West-facing panels are 8% less productive than those facing south; and east-facing 12% less productive. Adding 12% more panels to an east-facing direction will give you the same production as though it were facing south. South, west, and east will all have good production; you just don’t want solar panels facing north.
The best angle of the panels will depend on several factors, including the direction the panels face. If the panels face south, the most kWh production is at an angle equal to our latitude, which is 34°. This angle takes equal advantage of the sun in the summer and winter seasons. If panels face west, the angle is better at 14-19°, because this direction favors the summer sun.
Net Metering
Most urban solar electric systems are tied into the electric utility’s grid (called a “grid-tied system”) and use “net metering.” Net metering measures your net energy usage; that is, the difference between the electricity you generate and the electricity you use. When you generate more than you are using, your meter will actually spin backwards.
Your electrical meter will still be read monthly. You will continue to receive a monthly statement showing the net amount of electricity you used or generated during the billing period. One year after you initiate your system, your utility will send you a bill for the net amount of electricity you used during the year. If your system is not sized to generate most of the electricity you use, you can pay your electric bill at any time to avoid a large single bill at the end of the year.
Note: Southern California Edison (SCE), the electricity provider in our area, no longer offers a monthly billing option; all solar system owners have annual billing with a monthly statement, but SCE will not refuse a check if you send them one. In all cases, SCE will send you a monthly bill for basic service, typically $1.00 to $2.00. Many homeowners choose to pay several months in advance rather than pay this amount monthly.
SCE will not buy back any energy you produce in excess of your annual consumption.
Cost and Cost Effectiveness
Over the past 20 years the price of solar electric systems has fallen dramatically, however the initial price of a home system can still be relatively high. The cost of a system will obviously depend on the size. As a general rule, costs are about $9,500 per kW produced (before the rebate and tax credit). A solar electric system is particularly beneficial for households with high electricity consumption.
If you are building a new home or refinancing a present home to do a major renovation, the economics are the most attractive. The monthly savings in lower electricity cost can often be less than the additional monthly payment on the system; in these cases the system essentially pays for itself immediately. Instead of being vulnerable to increasing monthly electricity costs, the monthly payment is held constant. Another advantage of mortgage financing is that the interest paid on a mortgage loan is generally deductible from your federal taxes (subject to certain conditions). And, when paid for, you own your own power production plant!
Tiered Billing. SCE has a tiered billing system; each home has a Baseline Allocation for which the cost is lowest. The Baseline Allocation is generally calculated as 60-70% of an average residential energy use. Energy used in excess of the baseline is billed at a higher rate.
Tier 1: 100% of the Baseline Allocation is billed at the Tier 1 lowest rate.
Tier 2: usage from 101% to 130% over the Baseline Allocation.
Tier 3: usage from 131% to 200% over the Baseline Allocation.
Tier 4: usage from 201% to 300% over the Baseline Allocation.
Tier 5: usage from and over 300% over the Baseline Allocation.
Therefore, if your energy usage is being billed at the higher tiers, you will save proportionately more money by generating your own, free energy.
Warranties. All contractors working with the California Solar Initiative Rebate Program and the New Solar Homes Partnership are required to provide a 10-year complete warranty covering the equipment, installation, and labor. Most solar panels also come with a 25-year power guarantee from the manufacturer, which guarantees that at the end of the 25th year the panels will still be producing at least 80% of their original output.
Incentives and Tax Credits
Existing Homes. Through the California Solar Initiative, the California Public Utilities Commission pays a one-time, upfront incentive payment, based on expected performance, for systems smaller than 100 kW. Expected performance is calculated based on equipment ratings and installation factors, such as geographic location, tilt, orientation, and shading. Residential and commercial systems receive up to $2.50 per watt. Typically, your solar installer will handle the paperwork for this, and the incentive will be deducted from your system cost before you pay the installer.
New Homes. Through the California New Solar Homes Partnership, the California Energy Commission pays incentives and provides technical and market support for builders participating in the program. Eligible applicants are builders and developers who install qualifying solar electric systems on new, highly energy-efficient residential buildings that are served (in our area) by Southern California Edison. To qualify, the homes must be 15% more energy efficient than required by the current Title 24 Standards. The program also offers a “Tier II” level of participation, which offers greater incentives for homes that are built to be 35% more energy-efficient than Title 24. In addition, appliances in the new homes must be ENERGY STAR where applicable. Incentive payments are $2.50 per watt, or $2.60 per watt in production housing with solar as a standard feature incentive.
Federal Tax Credit. For 2007, residential systems are eligible for a tax credit of up to 30% of the system cost, up to a maximum of $2,000. Businesses, including home-based businesses, are eligible for the full 30% credit. If your system is installed in 2007, the tax credit will apply to your 2007 taxes, so you will receive it in 2008.
Property Tax Exemption. Solar electric systems are exempt from property taxes; that is, the value added to your home by a solar system will not result in an increase in your property tax.
Code Considerations
The current 2005 version of Title 24 does not provide any compliance credit for installation of solar electric systems.
