We're on the fence about getting solar and would love some input

[explosive0]

We recently moved into our new home and were considering going solar with powerwalls, but would love some input from the experts on here

Current situation:

• 2 story, 3800 sqft in Houston
  • 2 AC units
  • Heat is natural gas
  • Stove is natural gas
• Recently married so historical energy usage may not be 100% accurate, but I'm estimating about 1000-1500 kW consumption in the colder months and 1500-2000 kW in the warmer months
• We typically pay anywhere from $200 to $350/month for electricity, but this is heavily dependent on how many days I work from home etc.
• 1 EV currently (MY) but will most likely be adding a Model 3 in the next couple months

Used the online tool to build a system and it's recommending a 19.44 kW system, and I plan to install 3 powerwalls. Total price is about 72k before any incentives.

I'm struggling with the decision, primarily based on price, but wanted some input from those who've had theirs for a while. Any regrets?

 

[arnolddeleon]

What are your goals? They can be multiple and conflicting. Examples: Save money, be green, have cool technology, protect from blackouts, feel less guilty about running AC.

What is your current cost per kWh? What is the cost per kWh of proposed solar? Do you have net metering available?

 

[CWhite]

Consider your gas bill over the winter. We had an older HVAC and went to a new heat pump. Cut our gas bill by 70% and it helped the payback period. If changing to a heat pump is possible you might consider more panels. Having net metering is key, does your utility have any program to buy power from your powerwalls? That also makes a difference. I cannot put a price of the comfort of knowing the freezer will never defrost during an outage, therefore can’t tell how much it is worth. I consider it money well spent but it is a personal choice. Just panels will eventually pay for themselves, the batteries are hard to justify strictly from a return on investment calculation.

 

[ATPMSD]

Let’s put a few number this shall we?

Let’s assume your bill is $350 / month, which is $4,200 annually. Let’s also assume if you install that $72,000 system you will be completely off the grid, so you will save $4,200 / year. Your breakeven is 17-years.

But of course your solar is not maintenance free and assuming you are financing, your total cost will be more like $115,000+ on a 20-year deal, plus maintenance, which pushes the breakeven past 27+ years. Now of course the cost of electricity will rise, but panels and batteries will need to be replaced.

Of course I have not factored in any credits, but my advice is to look at other configurations and find a breakeven that you will be happy with.

 

[explosive0]

What are your goals? They can be multiple and conflicting. Examples: Save money, be green, have cool technology, protect from blackouts, feel less guilty about running AC.

What is your current cost per kWh? What is the cost per kWh of proposed solar? Do you have net metering available?

Ideally, I’d love to go green, have cool technology and protect from Houston blackouts during hurricane season without paying more than I pay currently, over a period of time, of course.

I just switched to Tesla Electric and I believe my current rate is $0.135 per kWh.

I doubt I’d get true net metering in Houston, but there are buy back options available, and can always sell back to VPP when possible.

 

[explosive0]

Let’s put a few number this shall we?

Let’s assume your bill is $350 / month, which is $4,200 annually. Let’s also assume if you install that $72,000 system you will be completely off the grid, so you will save $4,200 / year. Your breakeven is 17-years.

But of course your solar is not maintenance free and assuming you are financing, your total cost will be more like $115,000+ on a 20-year deal, plus maintenance, which pushes the breakeven past 27+ years. Now of course the cost of electricity will rise, but panels and batteries will need to be replaced.

Of course I have not factored in any credits, but my advice is to look at other configurations and find a breakeven that you will be happy with.

If we go with this, I’ll suck it up and pay upfront without financing. I just hate the idea of financing a “utility”

 

[CWhite]

$25,000 of the price is the powerwalls. Without those the payback period is a bit over 10 years. I consider the powerwalls like a “luxury” item, it makes my life a little less stressful. In my opinion batteries should not be part of the break-even calculation.

 

[ATPMSD]

If we go with this, I’ll suck it up and pay upfront without financing. I just hate the idea of financing a “utility”

I hear you but best case breakeven is still 17-years. Also, if you fund it upfront you should consider your opportunity cost. That $17,000 invested at just 5% (say tax free bonds) over 15-years grows to $150,000+.

Just work the numbers and I am sure you will find the best answer that meets your aspirations. Good luck!

 

[CWhite]

Uhh, I think you missed something in your calculation.

After investing for 15 years at 5% interest, your initial investment of $17,000 will have grown to $35,342.

 

[cali8484]

I just switched to Tesla Electric and I believe my current rate is $0.135 per kWh.

Solar rarely makes financial sense at such low level of electricity cost much less batteries.

I doubt I’d get true net metering in Houston, but there are buy back options available, and can always sell back to VPP when possible.

None of that will help much as financial justification.

 

[explosive0]

Thanks all. With the cheap electricity rates in Texas, it probably makes more sense for us to get a 23 kW standby generator for any true emergencies. It should run us a little over 14k installed.

 

[CWhite]

Doesn’t make financial sense??? In the PNW I pay $0.125 per kWh. My 2017 7.8kw solar panels cost $8600 after all tax credits. My annual electric bill went down by $1300 meaning it was paid off in under 7 years. I am am not even counting the gasoline I am not buying from driving an EV or the $750 reduction in our natural gas bill by relying more on a heat pump for HVAC. Now I have no electric bill and the system has made back the money I spent. How does this not make financial sense? I am not a hard core environmentalist, I move towards where I save money. If that is good for the environment then all the better. I think most people are like that. If it makes no financial sense I don’t think so many people would be installing solar.

 

[ATPMSD]

I hear you but best case breakeven is still 17-years. Also, if you fund it upfront you should consider your opportunity cost. That $17,000 invested at just 5% (say tax free bonds) over 15-years grows to $150,000+.

Just work the numbers and I am sure you will find the best answer that meets your aspirations. Good luck!

LOL, yeah I meant to say if he invested the $72,000 THAT would total $150,000. No idea where I got $17,000 from! Thanks for catching that brain fart.

 

[CWhite]

Thanks all. With the cheap electricity rates in Texas, it probably makes more sense for us to get a 23 kW standby generator for any true emergencies. It should run us a little over 14k installed.

I assume you have natural gas to the house to run the generator on? 20 years ago we had a gasoline generator and it was really hard to keep it running for 36 hours. We had that option but in our area a reason for a long term power outage could be an earthquake (yes, very remote chance but very long term issues when it does happen). That would knock out natural gas also. I have earthquake insurance, this is that kind of thinking. The batteries gave us some off-the-grid stability, basically indefinite lights and refrigerator (and full function durning summer)

 

[h2ofun]

Thanks all. With the cheap electricity rates in Texas, it probably makes more sense for us to get a 23 kW standby generator for any true emergencies. It should run us a little over 14k installed.

YES!!

 

[h2ofun]

I assume you have natural gas to the house to run the generator on? 20 years ago we had a gasoline generator and it was really hard to keep it running for 36 hours. We had that option but in our area a reason for a long term power outage could be an earthquake (yes, very remote chance but very long term issues when it does happen). That would knock out natural gas also. I have earthquake insurance, this is that kind of thinking. The batteries gave us some off-the-grid stability, basically indefinite lights and refrigerator (and full function durning summer)

Who runs the generator 24/7? When I use mine, I run like 3 hours a day. I have a 500 gallon propane source.

Get battery powered lights. Get a small generator with extension cord for the refrig. I have all the stuff, and NO way would I ever try
to convince someone there is any ROI!! worth doing

 

[explosive0]

I assume you have natural gas to the house to run the generator on? 20 years ago we had a gasoline generator and it was really hard to keep it running for 36 hours. We had that option but in our area a reason for a long term power outage could be an earthquake (yes, very remote chance but very long term issues when it does happen). That would knock out natural gas also. I have earthquake insurance, this is that kind of thinking. The batteries gave us some off-the-grid stability, basically indefinite lights and refrigerator (and full function durning summer)

Yes, we have natural gas. One of the reasons I really want to go solar is how cool it is, but my wife just isn’t buying the upfront cost for our use case. Break even period is just too long.

 

[cali8484]

My 2017 7.8kw solar panels cost $8600 after all tax credits.

Congrats. Would love hear more about how you got $1.1/W installed cost assuming it's not DIY.

 

[CWhite]

Congrats. Would love hear more about how you got $1.1/W installed cost assuming it's not DIY.

30% fed and $6000 state for starts

 

[Redhill_qik]

I hear you but best case breakeven is still 17-years. Also, if you fund it upfront you should consider your opportunity cost. That $72,000 invested at just 5% (say tax free bonds) over 15-years grows to $150,000+.

Just work the numbers and I am sure you will find the best answer that meets your aspirations. Good luck!

I often see the same discussion point, but this is too simplistic as it doesn't include the following:

• Continuing to still pay the utility ~$275/month (OP said $200-$350/month)
• Utility rate increases

Running a basic scenario with your original vs including the payment and 4% vs 5% returns this;

	Scenario 1 - No utility payment	Scenario 2 - 5% Invest w/Utility	Scenario 3 - 4% Invest w/Utility
Initial Amount	$ 72,000.00​	$ 72,000.00​	$ 72,000.00​
Interest	5.00%​	5.00%​	4.00%​
Payment	$0.00​	($275.00)​	($275.00)​
Months	180​	180​	180​
Years	15​	15​	15​
Future	$152,186.68​	$78,375.96​	$63,161.25​

Future utility rate increases are an unknown, I ran a couple of scenarios:

Investment Rate	Utility Annual Increase	Future Value
5.00%​	5.0%​	$47,189.56​
4.00%​	5.0%​	$32,046.08​
5.00%​	7.5%​	$24,703.08​
4.00%​	7.5%​	$10,617.28​
5.00%​	10.0%​	($3,422.60)​
4.00%​	10.0%​	($16,262.70)​

I'm not showing this here, but financing the solar with 6% interest rate is a better overall solution.