Tag: "solar economics"

04/08/18

  11:21:00 am, by Jim Jenal - Founder & CEO   , 359 words  
Categories: Solar Economics, Residential Solar

Coming next week: A 3 part-series: My Electric Bill is So High - Will Solar Help?

On of our most popular blog posts ever - I’ve Got Solar - Why is My Bill So High? -  looked at how to understand solar economics after your system is installed.  My (nearly five-year-old) book, Commercial Solar: Step-by-Step, outlined the decision-making process for facility managers and commercial building owners thinking about going solar. 

But it is high time that we wrote about this all-important question from the homeowner’s perspective:

My Electric Bill is So High - Will Solar Help?

Here’s an overview of what we will be covering in the series:

Why are my bills so high?

Part 1 - How High is High?

We will explore how to get a sense of what solar can, and cannot do for you.  A solar power system can be a great investment, but it isn’t a silver bullet, and not every home will be a good candidate for that investment!

Part 2 - How to Choose Installers to Bid

Ask anyone who has had solar installed on their home, and they will tell you: the choice of the installer makes all the difference. 
Find a good one - and there are many of us out there - and the process should go smoothly, and you will be happy with your choice for many years to come.  Pick a bad one - and sadly, there are far too many of them out there - and you will live with that decision for a long time to come.

We will arm you with the facts you need to make the right choice.

Part 3 - How to Evaluate Solar Proposals - Including Financing

For most homeowners, this is your one and only experience having solar installed.  You will get multiple proposals from your selected installers - but they will probably look nothing at all alike!  In most locations there are no required disclosures, so the amount of information presented, and the way that it is presented, will vary dramatically from one installer to another! 

We will explain what to look for as you try to pick the perfect “apple” from the “fruit salad” being presented to you!

So that’s it - we will be publishing the first installment on Tuesday.  If there is something you would like us to cover that we haven’t alluded to, please let us know.

 

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01/29/15

  05:36:00 am, by Laurel Hamilton   , 406 words  
Categories: All About Solar Power, Solar Economics, Residential Solar

Its Official...Solar Boosts Home-Owners' Property Values!

Selling into the SunMany solar stakeholders have always assumed rooftop solar systems add to the resale value of a property. Homeowners and residential solar companies frequently use this benefit as one of the many reasons to invest in solar even though until recently there had been little statistical evidence to support the assumption.

So we were thrilled to read the new study, “Selling into the Sun: Price Premium Analysis of a Multi-State Dataset of Solar Homes,” which finally quantifies the resale value of residential photovoltaic  (PV) solar systems. The study was a collaborative effort including esteemed scientists from the U.S. Department of Energy’s Lawrence Berkeley Lab, Adomatis Appraisal Services, Real Property Analytics/Texas A&M University, University of California at San Diego, San Diego State University, and Sandia National Laboratories.

The team analyzed some 22,000 home sales, of which nearly 4,000 had PV rooftop solar systems (more than double the number in previous studies), in eight states over a 12-year span including the housing market boom, bust, and recovery. This is by far the largest and broadest dataset ever analyzed on the subject.

Results prove that homebuyers are consistently willing to pay more for homes with host-owned solar systems — averaging about $4 per watt of PV installed — across various states, housing and PV markets, and home types. This amounts to a premium of about $15,000 for a typical rooftop system. Other important conclusions the team discovered are as follows:

  • PV premiums had little variability between new and existing homes.
  • The dollar per watt premium decreases incrementally as system sizes increase - with the best value at 4 kilowatts (average household PV size) or less.
  • As systems age, the PV premium depreciates sharply from $6/watt for systems less than two years old to $3/watt after about eight years.
  • PV premiums correlate to the net cost of the solar system — which take into account rebates and incentives — and appear to be independent of the PV system gross cost estimates.

As residential solar systems become more and more common, it is important to be able to value them accurately. The evidence of the added investment value shown from this study is a critical step for the growth of residential solar. And PV premiums are obviously a benefit homeowners should consider when doing their cost-benefit analysis of going solar.

Please note that this study only focused on host-owned solar, not those with leased systems. It would be interesting to see a future study including this growing portion of the PV market.

12/11/14

  09:19:00 am, by Laurel Hamilton   , 428 words  
Categories: All About Solar Power, Solar Economics, SEIA

Rapid growth in the solar industry made 2014 the best year yet!

It has been a great year for solar in the US! As the year comeRun on Sun crews to an end, we like to take a look at the numbers to get a sense of how the industry is doing as a whole. The first statistic I came upon stated that through just the first half of 2014, 53% of all new electric capacity installed came from solar!

According to the U.S. Energy Information Administration, utility-scale solar as of September, 2014 had sent 14.2 gigawatt-hours of electricity to the U.S. grid, up 110% compared to 6.7 GW in 2013. California is leading the way with a whopping 7.8 GW generated in 2014, 188 percent change from 2013!

That means solar generation was enough to meet the electricity needs of 1,513,703 average U.S. homes, and represented about 0.4 percent of the nation’s total electricity. However, these numbers don’t take into account residential and private commercial solar.

“There are now more than half a million homes and businesses nationwide with a solar installation,” reported the Solar Energy Industry Association (SEIA).

With continued growth and accounting for these additional sources of generation, solar electricity could easily account for 1 percent of U.S. generation by the end of this year. That might sound like small potatoes, but as recently as 2008 the energy contribution from solar was virtually zero. Rapid growth in the sector points toward continued gains in the near future.

What’s spurring this remarkable growth in the industry? For one thing, it is becoming more and more affordable with the average price of a solar panel declining by 64% since 2010. We also cannot overstate the role of effective public policies such as the solar Investment Tax Credit (ITC), Net Energy Metering (NEM) and Renewable Portfolio Standards (RPS) among other state and city-specific policies.

Growth in the solar sector has far reaching positive impacts for the US economy as well as the environment! While the numbers are not yet in for 2014, as of 2013 the industry had already provided 143,000 much needed jobs for Americans or more than 50 people hired in solar each day. Looked at another way, nearly $20 billion a year was invested back into the economy due to the industry.

On the environmental side Rhone Resch, CEO of SEIA, noted that solar will “help to offset an estimated 20 million metric tons of harmful CO2 emissions in 2014, which is the equivalent of taking 4 million cars off U.S. highways, saving 2.1 billion gallons of gasoline or shuttering half a dozen coal-fired power plants”. Needless to say, converting to solar or other renewable energy sources is paying huge dividends for both our economy and the environment. We look forward to sharing this great resource with continued growth in 2015 and beyond!

12/17/10

  07:42:25 am, by Jim Jenal - Founder & CEO   , 564 words  
Categories: Solar Economics, Solar Tax Incentives

Solar Economics Heading into 2011 - Part 1

2010 is winding down which calls for the inevitable rounds of backward-looking assessments and forward-looking projections. At Run on Sun we are more geared toward looking forward so I would like to take note of some recent developments that should have positive economic impacts on the solar industry in the coming year. There’s lots to talk about here - tax developments, product availability, solar rebate levels, even California’s version of cap and trade - so we will tackle them one at a time. First up, tax policies.

The federal Investment Tax Credit for Solar Power Systems allows residential and commercial customers to apply 30% of the cost of their solar power system as a credit on their federal income taxes.  This credit, which is in place until 2016, is very popular but for larger projects is was somewhat limited by the “tax appetite” of the project owner.  Put simply, if the owner did not have that great a tax liability, the credit could not be fully utilized.

“An extension will help the solar industry remain one of the fastest growing industries in America and create thousands of new careers… keep[ing] solar working for America in 2011 and beyond.”

As a result, the “Stimulus” bill of 2009 introduced the most successful tax policy of the past two years - the Solar Treasury Grant Program which allowed owners of commercial systems to receive a grant for 30% of the cost of their solar power system directly from the Treasury without consideration of the owner’s tax situation.  The Grant program (also known as the Section 1603 program for its provision in the tax code) was set to expire at the end of the year. In one of the more welcome consequences of the just-passed Tax-Cut deal, the Solar Treasury Grant Program will be extended for another year.  That means that commercial solar systems that are substantially completed in 2011 will be able to apply for a 30% grant (less the value of any applicable utility rebates) and receive the payment in the form of a check from the Treasury instead of a credit (that they may or may not be able to use) on their next year’s taxes. According to SEIA President Rhone Resch, “An extension [of the Grant program] will help the solar industry remain one of the fastest growing industries in America and create thousands of new careers. We now urge President Obama to swiftly sign this bill into law and keep solar working for America in 2011 and beyond.”

Another favorable tax policy that has been in place for solar also got improved by the new Tax-Cut deal. Commercial owners of solar power systems are presently allowed an accelerated depreciation schedule, taking 50% in the first tax year following installation, with the remaining 50% to be depreciated in equal amounts over the following four years. The new legislation improves on that program by allowing 100% to be depreciated in the first year.

Collectively, these measures should help spur new commercial installations through 2011, and when combined with the generally improving economy and the overwhelming value represented by commercial solar power systems, 2011 should be a very good year for commercial solar.

While the information in this post is believed to be accurate as of the time it was written, Run on Sun cannot, and does not, provide tax advice. As always, please consult your tax advisor for specific guidance as to how any of these benefits might apply to your tax situation.

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Jim Jenal is the Founder & CEO of Run on Sun, Pasadena's premier installer and integrator of top-of-the-line solar power installations.
Run on Sun also offers solar consulting services, working with consumers, utilities, and municipalities to help them make solar power affordable and reliable.

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