Why are turnkey Solar PV systems so ridiculously overpriced?

[beeeerock]

Being further north, I was told to expect about 3 kWh/kW/day on an annual basis. That's about 1.1 kWh/w/yr (if I'm interpreting the units being used here). Power ranges between 8 and 12 cents / kWh, tiered on usage over the billing period. I'm always well up into the 12 cent range, so my calculations are based on that price.

My payback is long. Probably 20 years or so. But I don't like to look at it as an investment in the typical way... it's more like an investment in my future and my kid's future. If I had done it on credit, all I would have wanted was for the array to cover my financing charges on the loan. The house is worth more with the panels on the roof than without, so it's more of a home improvement that increased my equity.

Even after the 20 year break-even point, the panels will be producing power. The house value will be higher, in some proportion of the original install cost. So the idea of 'paying it off' is really a bit cloudy... the panels aren't consumables and retain a residual value... all I really need to do to 'pay them off' is offset the depreciation and efficiency losses during that period.

But the bottom line for me... it was the Right Thing To Do... just like the Car...!

 

[FlasherZ]

The graphs are not granular but you can eyeball numbers. If I was feeling pessimistic I would say 1.5 kWh/w*a, or optimistically 1.6 kWh/w*a is average. Or perhaps a better guess is about 1.6 kWh/w*a with a SD of about 0.2. I just checked (again!) pvwatts for my home presuming unobstructed sunlight for a pole mount array that lets me change the panel angle a couple times a year and I came up with 1.9 kWh/watt*a (6.62 kWh insolation / day*kW average)

I don't get anything near that at all. As I noted, my production numbers last year for my 30x300W (9 kW) array on my shed, 180 degrees, 6/12 pitch flush mount (26.5 degree tilt) is right at 12 MWh per year (11900 kWh to be exact). No obstructions.

 

[FlasherZ]

But the bottom line for me... it was the Right Thing To Do... just like the Car...!

I think some of us can do that, but most people around me don't have the "money-is-no-object-to-do-the-right-thing" type of disposable income. We get benefits (Illinois has a law that requires the county not tax you on the solar panel installs)... and yes, it is part of the real estate investment... so you shouldn't demand *hard* ROI's. But it has to make at least a basic amount of sense.

 

[DMage]

Suggest anyone interested in going solar checks out communitypowernetwork.com for a local solar co-op near you (or starts your own). They negotiated a great rate for us, in the low $2/w.

 

[beeeerock]

I think some of us can do that, but most people around me don't have the "money-is-no-object-to-do-the-right-thing" type of disposable income. We get benefits (Illinois has a law that requires the county not tax you on the solar panel installs)... and yes, it is part of the real estate investment... so you shouldn't demand *hard* ROI's. But it has to make at least a basic amount of sense.

Money always will be an object to many people, but I think we're on the way to a world where basing decisions solely on ROI no longer exists. I have zero incentives from government or my utility. Net metering for now, but no assurance it will continue indefinitely. Buying the car takes some very crafty accounting to justify, but we all did it anyway. Thankfully nobody buys a car for ROI! If we can afford the car, we can likely afford to accept less return on a solar array.

If you assume residual value, what is an acceptable ROI? Nobody seems to calculate it that way. Instead they seem to look at panels like a tank of magical fuel... and want the fuel to pay for itself before it's all consumed.

I'm not saying my thinking justifies paying inflated install prices, but making the decision based on whether the installation pays for itself in 15 years or 20 years shouldn't be the deciding factor. We give to charities because it's the right thing to do and society benefits (we hope) in return... no fixed ROI attached to the donation, and certainly no resale value. Offsetting some carbon is much the same thing. If we can afford to do it, we should be doing it.

 

[FlasherZ]

This would be my biggest fear. My Dad and I could handle the electrical side no problem. Not having a leaking roof afterwards? Eek.

Ultimately, it comes down to making sure you find the rafters. In many cases this can be done fairly easily with a studfinder. Some have used thermal imaging cameras (I believe Jason did this ).

Once you have it marked well, it's simple:

 

[nwdiver]

Ultimately, it comes down to making sure you find the rafters. In many cases this can be done fairly easily with a studfinder. Some have used thermal imaging cameras (I believe Jason did this ).

IR works great if the conditions are right... I broke down and bought a deep scanner... got lucky and found one used for $350. You still have to sound with a mallet to eliminate the false positives but it works well if you can rule those out.

 

[TheTalkingMule]

More illustration of why slapping up quality hardware at the cheapest install price is not a good option.

 

[FlasherZ]

IR works great if the conditions are right... I broke down and bought a deep scanner... got lucky and found one used for $350. You still have to sound with a mallet to eliminate the false positives but it works well if you can rule those out.

Right. I always identify three together and make sure they're spaced how I expect them to be (16" or 24" centers") to help avoid the false positives. Then each one can be validated by measurements from there on...

 

[strider]

Gah. You all are getting me all fired up to do this myself. Just spent the last hour watching Quick Mount training videos instead of working

 

[nwdiver]

But the bottom line for me... it was the Right Thing To Do... just like the Car...!

I totally agree... but early adopters can't carry this energy revolution across the finish line. Most people sadly live paycheck to paycheck and need to see short term savings for any change to be viable. It's time for mass market PV.

 

[beeeerock]

I totally agree... but early adopters can't carry this energy revolution across the finish line. Most people sadly live paycheck to paycheck and need to see short term savings for any change to be viable. It's time for mass market PV.

Very true. For those people, any discussion of a big dollar expenditure now for a payback (or break-even) in 15 or 20 years, or even 5 years, is also a non-starter. If they're paycheque to paycheque, there is no opportunity to get out of the rut. So absolutely, a mass-market PV solution that can be affordable to those people would be fantastic to have! I guess SolarCity is the closest to mass-market that we've seen so far, but still not accessible to everyone (or even 'most' I suppose). I believe that scalable community solar projects may be the way to get into that market segment. Like a retirement savings plan... just pay what you can, when you can, and eventually you have a decent chunk of the big project.

 

[nwdiver]

Very true. For those people, any discussion of a big dollar expenditure now for a payback (or break-even) in 15 or 20 years, or even 5 years, is also a non-starter. If they're paycheque to paycheque, there is no opportunity to get out of the rut. So absolutely, a mass-market PV solution that can be affordable to those people would be fantastic to have! I guess SolarCity is the closest to mass-market that we've seen so far, but still not accessible to everyone (or even 'most' I suppose). I believe that scalable community solar projects may be the way to get into that market segment. Like a retirement savings plan... just pay what you can, when you can, and eventually you have a decent chunk of the big project.

My dream is to partner with a local bank and offer a loan with a ~15 year term where the loan payments are lower than the savings on your electric bill. I think there's a market segment leases don't appeal to.

At a ~$3/w price point a 401k loan doesn't just become practical but also compelling. From the perspective of diversification you can reduce your exposure to a volatile market while locking in a virtually guaranteed return and do what's morally imperative. It's a win-win-win.

I do like community solar projects but they're more vulnerable to the whims of the utility. With a strong partnership and a willing utility I think they could potentially play a larger role than rooftop residential.

 

[FlasherZ]

IR works great if the conditions are right... I broke down and bought a deep scanner... got lucky and found one used for $350. You still have to sound with a mallet to eliminate the false positives but it works well if you can rule those out.

I have a studfinder that has a "deep" mode that can penetrate shingles and 5/8" plywood. Tends to work fairly well, but no longer on the market.

 

[FlasherZ]

<<drooling>>

SolarWorld no less. That is awesome! What is the panel efficiency ?

Only 14.31% (full sized panels) - but I absolutely cannot complain given the price.

 

[nwdiver]

I have a studfinder that has a "deep" mode that can penetrate shingles and 5/8" plywood. Tends to work fairly well, but no longer on the market.

What brand? I honestly didn't even try any stud finders since all the reviews I read said they didn't work at all...

 

[TheTalkingMule]

My dream is to partner with a local bank and offer a loan with a ~15 year term where the loan payments are lower than the savings on your electric bill. I think there's a market segment leases don't appeal to.

At a ~$3/w price point a 401k loan doesn't just become practical but also compelling. From the perspective of diversification you can reduce your exposure to a volatile market while locking in a virtually guaranteed return and do what's morally imperative. It's a win-win-win.

This is definitely already happening in southeastern PA. You can get $2.75/W and a low interest loan that nets out to about even with your current electric bill. And this area is nowhere near scale. It's the regulatory certainty that is helping most.

 

[SageBrush]

It's the regulatory certainty that is helping most.

In what sense ? I'd like to hear details if you have the time

 

[TheTalkingMule]

In what sense ? I'd like to hear details if you have the time

Pennsylvania's previous governor was put in place by Aubrey McClendon formerly of Chesapeake Energy, he kept solar at bay with uncertainty around Pennsylvania's stance on net metering and subsidy. By dangling the idea that the state rebate may come back he effectively kept installs on hold because major savings might be right around the corner. He also kept the PUC from creating any sort of certainty around net metering rates.

The new governor is amazing and doing everything he can to support solar in spite of our rats nest of a state House. The state PUC has pushed forward a plan to lock in net metering for a while and I think has even locked in grandfathering of net metering rates. By doing this, both installers and customers know where they stand now and likely ten years from now. With that amount of certainty, commerce can proceed.

Imagine if you were in Nevada right now, why on Earth would you buy solar today or open an installation business?

 

[SageBrush]

The new governor is amazing and doing everything he can to support solar in spite of our rats nest of a state House. The state PUC has pushed forward a plan to lock in net metering for a while and I think has even locked in grandfathering of net metering rates.

Thanks for the information.

I honestly was wondering if 'regulatory certainty' is PC talk for 'subsidy.' In the case of simple net metering I would say no, but if I am reading your post correctly, that arrangement has not been finalized. And FWIW, net metering as an inducement for homeowners to buy PV is pretty easily circumvented by (future) hostile PUCs by adding on special surchages to PV homeowners. Read NWDiver's thread for a nasty example.

So I'm elated to hear that PV is taking off in your area and is pretty cheap to have installed, but either the good folks of PA are naive or there is more to the story.