8 ms·

The article suggests that solar panels could be an "existential threat" to power companies. For those of you who are familiar with the math of solar panels, how

The article suggests that solar panels could be an "existential threat" to power companies. For those of you who are familiar with the math of solar panels, how realistic is that prediction? How much of a normal home's energy needs could be supplied by solar panels, assuming the panels covered the entire surface area of the roof? How much is the ROI on solar panels likely to improve in the foreseeable future? (I've heard estimates of 5-8% annual return for 2014.)

djrogers 12y ago
I installed a 10kw system ~15 months ago on my 3600sq ft house. Average electricity costs was ~$6k/year before the panels, the first year on solar to total cost for the year was $300. That $300 worth of electricity for the year is before I've been able to talk the wife in to replacing our incandescent bulbs, swapped out our old pool pump, etc etc - I could easily get that down to below 0 with a small investment in bulbs. So in my case at least, it was trivially easy to get to a net-zero usage. A few $$ notes - the system cost $37k, I got 11.1k of that in a tax credit from the feds, so my net cost was 26k. I'm saving 5.7k/yr, which means my break even point for the system is 5 years. In 5 freaking years I'm making money from my solar panels! And I don't have to write a $500 check to PG&E every month. It's a beautiful thing... BTW - the above numbers (plus my severe aversion to debt) are why I'm so against solar leases. If we had a solar lease, we'd still be stuck with monthly payments, would have trouble selling our house, and would be stuck for 20 years.
- Pxtl 12y ago
  Where you located? Are we talking Texas or Michigan?
- chdir 12y ago
  How many units does $500 fetch where you live? Would be curious to know a breakdown of the bigger portion of the pie in those units.
- mrfusion 12y ago
  $6K/year sounds really high no? My neighbor pays $100-150/month for a 3200 sqft house.
  - jere 12y ago
    Yea a $500 per month electricity bill sounds steep to me. When my bill hit $400 in the winter, I realized I had a problem with my water heater.
  - HeyLaughingBoy 12y ago
    That's what I thought. My house is about the same size as his and completely exposed to weather. While I live in not-so-balmy Minnesota, it does get well above 90F and humid regularly in summer. Not to mention that the only non-electric heating appliance is the furnace. I get irritable if my bill hits $250, I'd be freaking out at an average of $500/month.
  - Igglyboo 12y ago
    He says he has a pool and if he lives in california then that pump is probably running all year, probably adds a few hundred a month to his bill.
  - ryanhuff 12y ago
    How much power do you consume a month? Pool heaters can really kill your electric bill.
  - Shivetya 12y ago
    Welcome to a fully regulated rate structure, throw in the combined weight of years and years of "its for the environment" and the costs go to the people who have the least voice and for many the least ability to pay. The have so regulated pricing and punitive structures into service there that they have to have assistance programs just to alleviate the burden on middle income and lower consumers.
- hga 12y ago
  Where do you live? Where I live, in SW Missouri, capital and maintenance costs might be higher due to weather (e.g. high winds, hail), and it would be useful during the summer---which the electric company would be generally thankful for, less $$$ peaking power needed---but much less so in fall and winter when it's frequently overcast. Also, if you live in a place with high electricity rates, like California, the case elsewhere is less compelling. I probably pay on the order of 1/2 of your savings for the total power to handle a building that's almost certainly bigger and thirstier than your's (numbers on request).
- crdoconnor 12y ago
  Hawaii?
- pkaye 12y ago
  Where do you live? Do you use electricity for heating? I'm in California and for a 1500 sf house, it costs us roughly $600 in electricity and $600 is gas per year. This actually an old house with some insulation. I think it would be more efficient for me to improve the insulation and water heater/furnace before even considering solar panels. I wish they would subsidize these other improvements as much as solar panels.
  - djrogers 12y ago
    I'm in an unfortunate area of California where my tier usage is tied to parts of the bay area, but the weather is closer to the central valley. Our AC and pool pump are big parts of that $6k/year usage, and while AC is a luxury, when it's 105* for a week or two straight and you've got little kids around, it sure is nice. There are also 2 other factors that feed in to our electrical costs - I work from home, and we have 2 little kids. That means our home doesn't get to shut down during the day. AC, fridge door opening, lights, etc., it all adds up when 4 people live in a house 24/7 instead of being gone during the hottest parts of the day.
    - ensignavenger 12y ago
      You mention the AC and pool pump- and then state that the AC is a luxury :)
  - maratd 12y ago
    I'm in NJ and my numbers are the same. I think it's because we use gas for heating/cooking/hot water. If everything was electric, I can imagine things costing almost twice as much, if not more.
  - Roboprog 12y ago
    Like "djrogers", I also live under (let's name names) PG&E and their "infernal" tiered pricing. Try paying 30 to 40 cents a kW/h, and also working from home with kids running around during the summer. I live in the Sacramento area, but outside of "SMUD" coverage, so I have to have PG&E. When it is about 100 degrees +/- for 3 months solid, A/C is "life support", not a convenience. $400/month electric bill, very typical for summer.
- baddox 12y ago
  How long are your panels expected to last, and how much maintenance do they require? Is the 5 year break even point pretty much guaranteed, and considering those things?
  - djrogers 12y ago
    They've got 20yr warranties, and require zero maintenance where I live. If you have more rain/snow than I get, or perhaps salt spray etc, you may need to do some cleaning. Once every few months the monitoring doohickey needs a reboot, but the panels work with or without that. For my personal situation, unless PG&E reduces their power rates over the next 5 years, I'll absolutely hit that break-even point. Panel production will degrade over time - the warranty covers something like 3% the first year, and 1% every year after that. So at 5 years I will have less than an 8% reduction in output from the panels. That 8% will be made up by that time with LED bulbs, a variable speed pool pump, etc. Heck, right now out of the ~30 ceiling cans in my house, only my office (4) and front porch (3) are LED. The rest are full 60W sucking incandescent bulbs. The chandeliers are also 60W bulbs too, accounting for another dozen or so lights that are on quite frequently. What can I say - my wife hates CFLs and barely tolerates LEDs.
    - baddox 12y ago
      You mentioned the reduction in your energy bill, but do you happen to track how much of that comes from selling back to the grid and how much comes from you using your solar power directly? If you're generating 10kW a few hours each day, I would guess that's the only time you're selling back. Would there be any point in an energy storage system for you? I've always had this fanciful notion of having a solar array and building an underground flywheel for storage, but only because I'm riveted by flywheels. I haven't looked into the ROI of CFLs or LEDs vs. incandescents in a while. I imagine they have improved. Lately, I've even seen some LED bulbs in stores that don't look horrible. Of course, I would buy them anyway just to save time changing bulbs!
      - secabeen 12y ago
        I have a similar system, and I sell back for about 80% of daylight hours. That credit covers all of my other needs in the summer (and then some), and about half of my usage during the winter months. When you originally design the system, you use current rates and policies to create a system that generates at most a net zero usage.
- g8oz 12y ago
  Wholesale panels are $500 a kW. That's a lot of markup you had to pay. Definitely much room for improvement on margins.
  - secabeen 12y ago
    Labor is a big cost, as well as permitting and the like. It's certainly a business with a lot of profit in it now. As long as the marginal rates of power are high, it's still break-even for the customer fast enough that they don't mind. The feds and the utilities pay the costs.
nobodysfool 12y ago
Well, one of my friends in Arizona has not necessarily his whole roof covered, but he is able to generate about 90% of his yearly energy usage. The only problem is that he doesn't have batteries installed, so he's selling his electricity to the local power company and buying it back. With batteries and a slightly larger system, he'd meet all his energy needs himself. It's definitely possible. One thing that helps is the hot water heater is solar powered as well.
pwnna 12y ago
I believe there was a report from US utility companies saying that solar will severely impact their revenue. http://www.eei.org/ourissues/finance/Documents/disruptivechallenges.pdf http://www.eei.org/ourissues/finance/Documents/disruptivecha...
abakker 12y ago
Without directly answering the question of total capacity, solar does have a few problems that are unlikely to ever make it an "existential threat" to commercial power generation, especially when done at home. 1. It is highly dependent on the amount of sunlight an area gets. This might seem obvious, but is also problematic in that it is difficult to build the correct capacity for climates that vary significantly over seasons. Solar is well and good in Los Angeles, since the weather is very consistent, and the amount of sunlight doesn't vary hugely over the year. In Seattle though, if you were to install enough capacity to be useful in the winter, you would drastically over-produce in the summer. Over production of solar is currently a problem, and can have significant detrimental impact on the overall power grid. Typically, when it drastically over-produces, it can cause blackouts. This is amplified by the fact that solar produces its maximum amount of output at a time when people don't consume the most electricity. This may eventually be mitigated by better batteries, and alternative power storage systems like Vanadium Flow systems. 2. Solar has a maximum capacity, and will likely always need to be mixed with other "on-demand" power generation systems. At present, these are Coal or NatGas generation stations that can be ramped up to meet spikes in demand. Effectively, these plants allow us to store energy chemically in the gas/coal and burn it on demand. very few renewable energy sources have the ability to be ramped up to greater production over short period of time. Again, this problem could be mitigated by substantial battery installations, where a small amount of excess generation from solar could charge batteries that could be drawn on to deal with spikes in demand. 3. Power transmission is always going to be a problem. Solar is less and less viable the further toward the poles you go. Though we could generate power in the southwest, there are practical limits to how far power can be transmitted over existing lines without too much loss. In all, though it would be possible for Solar to operate a given house or building with on-site generation. It is very unlikely to threaten the power companies, which give us a low-cost, reliable, and simple solution that is capable of meeting our needs.
- gohrt 12y ago
  Is it not possible to "turn off" a solar panels? Worst case, you have to throw a tarp over some of your panels for summertime.
  - 12y ago
maxerickson 12y ago
There's a lot of parameters (load, location, roof size, season), but I think the answer is generally > 100%. On the other hand, cities don't have the surface area to account for industrial consumption.
ilyanep 12y ago
I'm making a lot of assumptions here, as I'm not an expert on solar panels (took a class that touched on them once, but I'm mostly just Googling here): * Typical efficiency of a consumer solar panel to day is about 12% * Average of 6 hours of sunlight a day over a year, sunlight providing 120 W/m^2 [1] * Rooftop of about 80 m^2 Total energy over a year comes out to about 2500 kWh.[2] Apparently the average household energy usage in the US is about 10000 kWh[3], which would imply that you could get about a quarter of your energy from solar. A few caveats: * Apparently some places get up to 2200 kWh/m^2 per year of sunlight[4], which would bring your solar panel total to about 21000 kWh a year. * Not entirely sure how big your average rooftop is. * Solar panels have been created with efficiency in the 40s of percent[5] Hopefully I'm not completely off with some of these, but it seems reasonable that a rooftop system can provide most or all of your power in the near future, depending on how sunny it is where you live. If it's not sunny, you might have a lot more problems, though. [1] According to https://en.wikipedia.org/wiki/Sunlight https://en.wikipedia.org/wiki/Sunlight, the World Meteorological Organization defines sunshine as a state of receiving at least 120 W/m^2 [2] http://www.wolframalpha.com/input/?i=365+days%2Fyear+*+6+hours%2Fday+*+120+W%2Fm%5E2+*+80+m%5E2+*+.12+*+one+year http://www.wolframalpha.com/input/?i=365+days%2Fyear+*+6+hou... [3] http://www.eia.gov/tools/faqs/faq.cfm?id=97&t=3 http://www.eia.gov/tools/faqs/faq.cfm?id=97&t=3 [4] http://www.nrel.gov/gis/images/map_pv_national_lo-res.jpg http://www.nrel.gov/gis/images/map_pv_national_lo-res.jpg [5] http://www.sciencedaily.com/releases/2013/09/130923204214.htm http://www.sciencedaily.com/releases/2013/09/130923204214.ht...
- maxerickson 12y ago
  Power is quite a lot higher: http://en.wikipedia.org/wiki/Insolation#Earth.27s_insolation http://en.wikipedia.org/wiki/Insolation#Earth.27s_insolation (the 250 W/m^2 there is the 24 hour average)
  - breischl 12y ago
    From the link >> Ignoring clouds, the daily average irradiance for the Earth is approximately 250 W/m2 Emphasis added. Seems like clouds might be a non-trivial factor, yes?
mrbabbage 12y ago
This doesn't answer your question about residential solar, but it's a useful primer on economic analysis for utility-scale operations. http://www.eia.gov/forecasts/aeo/electricity_generation.cfm http://www.eia.gov/forecasts/aeo/electricity_generation.cfm The interesting bit here is how wind is already cheaper than any other option save combined cycle natural gas, and wind is on track to surpass natural gas.
- kefka 12y ago
  I've been interested in the viability of those wind towers. The ground is blanketed with plastic tarp about 10ft above ground. It slowly tapers to vertical (approximates y=10^x curve). In the vertical section, there is a scaffolding with wind turbines. The idea is that the sun heats up the ground. When the wind starts moving, it goes up the chute, spinning the blades. It was theorized that a 1mile diameter ground cover + tower would give 500 MW of power.
blacksmith_tb 12y ago
I have a 4.8kW system on my 1700sqft home here in rainy Portland OR and I am net-zero (and that's with everything electric - heating and cooling, water heater, cooking, etc.). But I am also in a certified Passive House, which makes it quite a bit easier...
- bjelkeman-again 12y ago
  Building passive houses makes so much sense. Did you build it yourself or buy it?
  - blacksmith_tb 12y ago
    Bought - I was very, very lucky to have gotten it. But the builder/architect who made mine have built six so far in Portland, none of which have sold for much more than market prices. There's a lot of debate about how necessary going all the way to PH is, there's a "Pretty Good" house movement of just doing more generous insulation / other efficiency improvements, which is also much better than doing the bare minimum required by code. Less is more, either way.
clayton21 12y ago
To further comment on djrodgers: His ROI in 5 years but can possibly be less. Depending on the state/market/utility, the owner qualifies for local rebate incentive, homeowner solar water heating rebates, local labor substantability rebates and SRECs. SRECS are energy credits that are similar to forwards contracts that can be traded on an exchange. The federal tax credit (ITC) is 30% of the purchase price but expires in 2017 to 10%. But, forecasted solar cost drop to 2017 would far cover the itc.
- abakker 12y ago
  I would point out that most ROI models for solar look so good because of very generous subsidies. If subsidies aren't counted, the ROI time is not nearly so good. Additionally, the Total Cost of Ownership of Solar will be higher in areas where panels/solar systems are prone to damage from weather etc. Wind, Rain, Snow, freeze/thaw, dust can all damage solar arrays, or negatively impact their performance. If there are batteries involved, those will likely also need to be replaced before the system has initially paid itself off. Even if batteries get cheaper and better every year, the disposal fees for old batteries and their current inability to deal with house-sized loads well can easily add significant cost. I don't want this to sound like I am anti-solar. I am a big proponent of solar, but there are many problems with the current system. It is a somewhat unfair comparison no matter what, since the energy we buy from fossil fuel generation does not accurately reflect the cost of the pollution it makes or the environmental harm it does.
  - djrogers 12y ago
    "I would point out that most ROI models for solar look so good because of very generous subsidies. If subsidies aren't counted, the ROI time is not nearly so good." True, without the 11k rebate, my break-even point would have been 7 years instead of 5. I'd still have done it...
    - abakker 12y ago
      Thats pretty good - You also have the benefit of getting alternative return on that 11K upfront, which helps. Depending on whether you sell your house or not, I assume that the solar system will also generate a reasonably high ROI as an improvement to the home? It would be interesting to see what the real payback time period would be if you were to try to sell the house before its usage ROI were realized. i.e. could you buy a house, add solar, get the rebate, sell the house after 2 years and still get a return on the solar investment money because you'd improved the value of the house?
mikeyouse 12y ago
A big portion of the existential threat to power companies is the possibility of price-spirals. The cost of maintaining all of the power infrastructure for a region is relatively fixed, especially if people don't disconnect completely when they add renewables. This cost is generally recouped by a small surcharge to every kWh that's provided to customers. The possibility of a spiral arises when customers start purchasing significantly less power from the utility, which means the per-kWh cost for the remaining customers will have to increase. As this cost increases, the ROI of adding solar panels improves, so more people add solar. As more people add solar, the utility must increase prices to the remaining customers.. etc. etc. There's also pressure on this spiral from solar installers since the 'soft costs' make up the majority of new installations. As more people purchase systems, the per-installation price will decrease due to installers getting bulk discounts for materials, efficiencies (physical and bureaucratic - dealing with permits, etc.) from previous experience, and a bigger base to spread out the costs of their own capital equipment. Detractors think that utilities are fear-mongering to increase their operating and price flexibility, which would likely result in higher profits in the near-term. I don't think I buy this theory though, looking at my last bill of about $50, $28 was generation and about $25 was transmission & distribution (T&Ds). PG&E bills T&Ds based on system costs / proportional usage, so if I cut my power, my T&Ds would drop to almost 0, increasing the cost on everyone else. Here's a pretty balanced article about the issue; http://www.renewableenergyworld.com/rea/news/article/2014/04/solar-disruption-yes-utility-death-spiral-not-necessarily http://www.renewableenergyworld.com/rea/news/article/2014/04...
- AnthonyMouse 12y ago
  It seems like the obvious solution is to make transmission and distribution a flat amount rather than trying to amortize it per KWh.
  - mikeyouse 12y ago
    It will likely come down to that but since utilities are typically government-granted monopolies, it will take legislative action to allow changes. It will be a tough political sell since it would actively discourage new investment in distributed renewables and socialize the costs so that the people who used the most energy (and therefore drive most of the demand for T&D) will pay the smallest proportion of their upkeep.
gerbal 12y ago
I think it's that power companies depend on a very broad customer base to support their substantial capital investments. When you start removing a small portion of customers the cost of power to everyone else starts going up. And if those customers aren't consistently off-grid, i.e. they still need grid power sometimes, that can actually raise power costs. Increasing generation capacity to meet demand spikes is expensive, and requires having large, expensive power stations waiting at the ready, just costing money.
dorfsmay 12y ago
Kurzweil said their efficiency doubles every two years, and that they would be able to meet 100% of our energy needs by ~ 2030: http://www.livescience.com/4824-solar-power-rule-20-years-futurists.html http://www.livescience.com/4824-solar-power-rule-20-years-fu...
- teraflop 12y ago
  > Kurzweil said their efficiency doubles every two years According to that article, he said the "use" of solar energy doubles every two years. Efficiency has been gradually improving, but it's definitely not doubling every two years. Every few decades would be closer; that said, using an exponential curve to model a function that's capped at 100% doesn't really make much sense in the first place. http://en.wikipedia.org/wiki/File:PVeff(rev141113).jpg http://en.wikipedia.org/wiki/File:PVeff(rev141113).jpg

djrogers 12y ago

I installed a 10kw system ~15 months ago on my 3600sq ft house. Average electricity costs was ~$6k/year before the panels, the first year on solar to total cost for the year was $300. That $300 worth of electricity for the year is before I've been able to talk the wife in to replacing our incandescent bulbs, swapped out our old pool pump, etc etc - I could easily get that down to below 0 with a small investment in bulbs. So in my case at least, it was trivially easy to get to a net-zero usage. A few $$ notes - the system cost $37k, I got 11.1k of that in a tax credit from the feds, so my net cost was 26k. I'm saving 5.7k/yr, which means my break even point for the system is 5 years. In 5 freaking years I'm making money from my solar panels! And I don't have to write a $500 check to PG&E every month. It's a beautiful thing... BTW - the above numbers (plus my severe aversion to debt) are why I'm so against solar leases. If we had a solar lease, we'd still be stuck with monthly payments, would have trouble selling our house, and would be stuck for 20 years.

Pxtl 12y ago
Where you located? Are we talking Texas or Michigan?
chdir 12y ago
How many units does $500 fetch where you live? Would be curious to know a breakdown of the bigger portion of the pie in those units.
mrfusion 12y ago
$6K/year sounds really high no? My neighbor pays $100-150/month for a 3200 sqft house.
- jere 12y ago
  Yea a $500 per month electricity bill sounds steep to me. When my bill hit $400 in the winter, I realized I had a problem with my water heater.
- HeyLaughingBoy 12y ago
  That's what I thought. My house is about the same size as his and completely exposed to weather. While I live in not-so-balmy Minnesota, it does get well above 90F and humid regularly in summer. Not to mention that the only non-electric heating appliance is the furnace. I get irritable if my bill hits $250, I'd be freaking out at an average of $500/month.
- Igglyboo 12y ago
  He says he has a pool and if he lives in california then that pump is probably running all year, probably adds a few hundred a month to his bill.
- ryanhuff 12y ago
  How much power do you consume a month? Pool heaters can really kill your electric bill.
- Shivetya 12y ago
  Welcome to a fully regulated rate structure, throw in the combined weight of years and years of "its for the environment" and the costs go to the people who have the least voice and for many the least ability to pay. The have so regulated pricing and punitive structures into service there that they have to have assistance programs just to alleviate the burden on middle income and lower consumers.
hga 12y ago
Where do you live? Where I live, in SW Missouri, capital and maintenance costs might be higher due to weather (e.g. high winds, hail), and it would be useful during the summer---which the electric company would be generally thankful for, less $$$ peaking power needed---but much less so in fall and winter when it's frequently overcast. Also, if you live in a place with high electricity rates, like California, the case elsewhere is less compelling. I probably pay on the order of 1/2 of your savings for the total power to handle a building that's almost certainly bigger and thirstier than your's (numbers on request).
crdoconnor 12y ago
Hawaii?
pkaye 12y ago
Where do you live? Do you use electricity for heating? I'm in California and for a 1500 sf house, it costs us roughly $600 in electricity and $600 is gas per year. This actually an old house with some insulation. I think it would be more efficient for me to improve the insulation and water heater/furnace before even considering solar panels. I wish they would subsidize these other improvements as much as solar panels.
- djrogers 12y ago
  I'm in an unfortunate area of California where my tier usage is tied to parts of the bay area, but the weather is closer to the central valley. Our AC and pool pump are big parts of that $6k/year usage, and while AC is a luxury, when it's 105* for a week or two straight and you've got little kids around, it sure is nice. There are also 2 other factors that feed in to our electrical costs - I work from home, and we have 2 little kids. That means our home doesn't get to shut down during the day. AC, fridge door opening, lights, etc., it all adds up when 4 people live in a house 24/7 instead of being gone during the hottest parts of the day.
  - ensignavenger 12y ago
    You mention the AC and pool pump- and then state that the AC is a luxury :)
- maratd 12y ago
  I'm in NJ and my numbers are the same. I think it's because we use gas for heating/cooking/hot water. If everything was electric, I can imagine things costing almost twice as much, if not more.
- Roboprog 12y ago
  Like "djrogers", I also live under (let's name names) PG&E and their "infernal" tiered pricing. Try paying 30 to 40 cents a kW/h, and also working from home with kids running around during the summer. I live in the Sacramento area, but outside of "SMUD" coverage, so I have to have PG&E. When it is about 100 degrees +/- for 3 months solid, A/C is "life support", not a convenience. $400/month electric bill, very typical for summer.
baddox 12y ago
How long are your panels expected to last, and how much maintenance do they require? Is the 5 year break even point pretty much guaranteed, and considering those things?
- djrogers 12y ago
  They've got 20yr warranties, and require zero maintenance where I live. If you have more rain/snow than I get, or perhaps salt spray etc, you may need to do some cleaning. Once every few months the monitoring doohickey needs a reboot, but the panels work with or without that. For my personal situation, unless PG&E reduces their power rates over the next 5 years, I'll absolutely hit that break-even point. Panel production will degrade over time - the warranty covers something like 3% the first year, and 1% every year after that. So at 5 years I will have less than an 8% reduction in output from the panels. That 8% will be made up by that time with LED bulbs, a variable speed pool pump, etc. Heck, right now out of the ~30 ceiling cans in my house, only my office (4) and front porch (3) are LED. The rest are full 60W sucking incandescent bulbs. The chandeliers are also 60W bulbs too, accounting for another dozen or so lights that are on quite frequently. What can I say - my wife hates CFLs and barely tolerates LEDs.
  - baddox 12y ago
    You mentioned the reduction in your energy bill, but do you happen to track how much of that comes from selling back to the grid and how much comes from you using your solar power directly? If you're generating 10kW a few hours each day, I would guess that's the only time you're selling back. Would there be any point in an energy storage system for you? I've always had this fanciful notion of having a solar array and building an underground flywheel for storage, but only because I'm riveted by flywheels. I haven't looked into the ROI of CFLs or LEDs vs. incandescents in a while. I imagine they have improved. Lately, I've even seen some LED bulbs in stores that don't look horrible. Of course, I would buy them anyway just to save time changing bulbs!
    - secabeen 12y ago
      I have a similar system, and I sell back for about 80% of daylight hours. That credit covers all of my other needs in the summer (and then some), and about half of my usage during the winter months. When you originally design the system, you use current rates and policies to create a system that generates at most a net zero usage.
g8oz 12y ago
Wholesale panels are $500 a kW. That's a lot of markup you had to pay. Definitely much room for improvement on margins.
- secabeen 12y ago
  Labor is a big cost, as well as permitting and the like. It's certainly a business with a lot of profit in it now. As long as the marginal rates of power are high, it's still break-even for the customer fast enough that they don't mind. The feds and the utilities pay the costs.

nobodysfool 12y ago

Well, one of my friends in Arizona has not necessarily his whole roof covered, but he is able to generate about 90% of his yearly energy usage. The only problem is that he doesn't have batteries installed, so he's selling his electricity to the local power company and buying it back. With batteries and a slightly larger system, he'd meet all his energy needs himself. It's definitely possible. One thing that helps is the hot water heater is solar powered as well.

pwnna 12y ago

I believe there was a report from US utility companies saying that solar will severely impact their revenue. http://www.eei.org/ourissues/finance/Documents/disruptivechallenges.pdf http://www.eei.org/ourissues/finance/Documents/disruptivecha...

abakker 12y ago

Without directly answering the question of total capacity, solar does have a few problems that are unlikely to ever make it an "existential threat" to commercial power generation, especially when done at home. 1. It is highly dependent on the amount of sunlight an area gets. This might seem obvious, but is also problematic in that it is difficult to build the correct capacity for climates that vary significantly over seasons. Solar is well and good in Los Angeles, since the weather is very consistent, and the amount of sunlight doesn't vary hugely over the year. In Seattle though, if you were to install enough capacity to be useful in the winter, you would drastically over-produce in the summer. Over production of solar is currently a problem, and can have significant detrimental impact on the overall power grid. Typically, when it drastically over-produces, it can cause blackouts. This is amplified by the fact that solar produces its maximum amount of output at a time when people don't consume the most electricity. This may eventually be mitigated by better batteries, and alternative power storage systems like Vanadium Flow systems. 2. Solar has a maximum capacity, and will likely always need to be mixed with other "on-demand" power generation systems. At present, these are Coal or NatGas generation stations that can be ramped up to meet spikes in demand. Effectively, these plants allow us to store energy chemically in the gas/coal and burn it on demand. very few renewable energy sources have the ability to be ramped up to greater production over short period of time. Again, this problem could be mitigated by substantial battery installations, where a small amount of excess generation from solar could charge batteries that could be drawn on to deal with spikes in demand. 3. Power transmission is always going to be a problem. Solar is less and less viable the further toward the poles you go. Though we could generate power in the southwest, there are practical limits to how far power can be transmitted over existing lines without too much loss. In all, though it would be possible for Solar to operate a given house or building with on-site generation. It is very unlikely to threaten the power companies, which give us a low-cost, reliable, and simple solution that is capable of meeting our needs.

gohrt 12y ago
Is it not possible to "turn off" a solar panels? Worst case, you have to throw a tarp over some of your panels for summertime.
- 12y ago

maxerickson 12y ago

There's a lot of parameters (load, location, roof size, season), but I think the answer is generally > 100%. On the other hand, cities don't have the surface area to account for industrial consumption.

ilyanep 12y ago

I'm making a lot of assumptions here, as I'm not an expert on solar panels (took a class that touched on them once, but I'm mostly just Googling here): * Typical efficiency of a consumer solar panel to day is about 12% * Average of 6 hours of sunlight a day over a year, sunlight providing 120 W/m^2 [1] * Rooftop of about 80 m^2 Total energy over a year comes out to about 2500 kWh.[2] Apparently the average household energy usage in the US is about 10000 kWh[3], which would imply that you could get about a quarter of your energy from solar. A few caveats: * Apparently some places get up to 2200 kWh/m^2 per year of sunlight[4], which would bring your solar panel total to about 21000 kWh a year. * Not entirely sure how big your average rooftop is. * Solar panels have been created with efficiency in the 40s of percent[5] Hopefully I'm not completely off with some of these, but it seems reasonable that a rooftop system can provide most or all of your power in the near future, depending on how sunny it is where you live. If it's not sunny, you might have a lot more problems, though. [1] According to https://en.wikipedia.org/wiki/Sunlight https://en.wikipedia.org/wiki/Sunlight, the World Meteorological Organization defines sunshine as a state of receiving at least 120 W/m^2 [2] http://www.wolframalpha.com/input/?i=365+days%2Fyear+*+6+hours%2Fday+*+120+W%2Fm%5E2+*+80+m%5E2+*+.12+*+one+year http://www.wolframalpha.com/input/?i=365+days%2Fyear+*+6+hou... [3] http://www.eia.gov/tools/faqs/faq.cfm?id=97&t=3 http://www.eia.gov/tools/faqs/faq.cfm?id=97&t=3 [4] http://www.nrel.gov/gis/images/map_pv_national_lo-res.jpg http://www.nrel.gov/gis/images/map_pv_national_lo-res.jpg [5] http://www.sciencedaily.com/releases/2013/09/130923204214.htm http://www.sciencedaily.com/releases/2013/09/130923204214.ht...

maxerickson 12y ago
Power is quite a lot higher: http://en.wikipedia.org/wiki/Insolation#Earth.27s_insolation http://en.wikipedia.org/wiki/Insolation#Earth.27s_insolation (the 250 W/m^2 there is the 24 hour average)
- breischl 12y ago
  From the link >> Ignoring clouds, the daily average irradiance for the Earth is approximately 250 W/m2 Emphasis added. Seems like clouds might be a non-trivial factor, yes?

mrbabbage 12y ago

This doesn't answer your question about residential solar, but it's a useful primer on economic analysis for utility-scale operations. http://www.eia.gov/forecasts/aeo/electricity_generation.cfm http://www.eia.gov/forecasts/aeo/electricity_generation.cfm The interesting bit here is how wind is already cheaper than any other option save combined cycle natural gas, and wind is on track to surpass natural gas.

kefka 12y ago
I've been interested in the viability of those wind towers. The ground is blanketed with plastic tarp about 10ft above ground. It slowly tapers to vertical (approximates y=10^x curve). In the vertical section, there is a scaffolding with wind turbines. The idea is that the sun heats up the ground. When the wind starts moving, it goes up the chute, spinning the blades. It was theorized that a 1mile diameter ground cover + tower would give 500 MW of power.

blacksmith_tb 12y ago

I have a 4.8kW system on my 1700sqft home here in rainy Portland OR and I am net-zero (and that's with everything electric - heating and cooling, water heater, cooking, etc.). But I am also in a certified Passive House, which makes it quite a bit easier...

bjelkeman-again 12y ago
Building passive houses makes so much sense. Did you build it yourself or buy it?
- blacksmith_tb 12y ago
  Bought - I was very, very lucky to have gotten it. But the builder/architect who made mine have built six so far in Portland, none of which have sold for much more than market prices. There's a lot of debate about how necessary going all the way to PH is, there's a "Pretty Good" house movement of just doing more generous insulation / other efficiency improvements, which is also much better than doing the bare minimum required by code. Less is more, either way.

clayton21 12y ago

To further comment on djrodgers: His ROI in 5 years but can possibly be less. Depending on the state/market/utility, the owner qualifies for local rebate incentive, homeowner solar water heating rebates, local labor substantability rebates and SRECs. SRECS are energy credits that are similar to forwards contracts that can be traded on an exchange. The federal tax credit (ITC) is 30% of the purchase price but expires in 2017 to 10%. But, forecasted solar cost drop to 2017 would far cover the itc.

abakker 12y ago
I would point out that most ROI models for solar look so good because of very generous subsidies. If subsidies aren't counted, the ROI time is not nearly so good. Additionally, the Total Cost of Ownership of Solar will be higher in areas where panels/solar systems are prone to damage from weather etc. Wind, Rain, Snow, freeze/thaw, dust can all damage solar arrays, or negatively impact their performance. If there are batteries involved, those will likely also need to be replaced before the system has initially paid itself off. Even if batteries get cheaper and better every year, the disposal fees for old batteries and their current inability to deal with house-sized loads well can easily add significant cost. I don't want this to sound like I am anti-solar. I am a big proponent of solar, but there are many problems with the current system. It is a somewhat unfair comparison no matter what, since the energy we buy from fossil fuel generation does not accurately reflect the cost of the pollution it makes or the environmental harm it does.
- djrogers 12y ago
  "I would point out that most ROI models for solar look so good because of very generous subsidies. If subsidies aren't counted, the ROI time is not nearly so good." True, without the 11k rebate, my break-even point would have been 7 years instead of 5. I'd still have done it...
  - abakker 12y ago
    Thats pretty good - You also have the benefit of getting alternative return on that 11K upfront, which helps. Depending on whether you sell your house or not, I assume that the solar system will also generate a reasonably high ROI as an improvement to the home? It would be interesting to see what the real payback time period would be if you were to try to sell the house before its usage ROI were realized. i.e. could you buy a house, add solar, get the rebate, sell the house after 2 years and still get a return on the solar investment money because you'd improved the value of the house?

mikeyouse 12y ago

A big portion of the existential threat to power companies is the possibility of price-spirals. The cost of maintaining all of the power infrastructure for a region is relatively fixed, especially if people don't disconnect completely when they add renewables. This cost is generally recouped by a small surcharge to every kWh that's provided to customers. The possibility of a spiral arises when customers start purchasing significantly less power from the utility, which means the per-kWh cost for the remaining customers will have to increase. As this cost increases, the ROI of adding solar panels improves, so more people add solar. As more people add solar, the utility must increase prices to the remaining customers.. etc. etc. There's also pressure on this spiral from solar installers since the 'soft costs' make up the majority of new installations. As more people purchase systems, the per-installation price will decrease due to installers getting bulk discounts for materials, efficiencies (physical and bureaucratic - dealing with permits, etc.) from previous experience, and a bigger base to spread out the costs of their own capital equipment. Detractors think that utilities are fear-mongering to increase their operating and price flexibility, which would likely result in higher profits in the near-term. I don't think I buy this theory though, looking at my last bill of about $50, $28 was generation and about $25 was transmission & distribution (T&Ds). PG&E bills T&Ds based on system costs / proportional usage, so if I cut my power, my T&Ds would drop to almost 0, increasing the cost on everyone else. Here's a pretty balanced article about the issue; http://www.renewableenergyworld.com/rea/news/article/2014/04/solar-disruption-yes-utility-death-spiral-not-necessarily http://www.renewableenergyworld.com/rea/news/article/2014/04...

AnthonyMouse 12y ago
It seems like the obvious solution is to make transmission and distribution a flat amount rather than trying to amortize it per KWh.
- mikeyouse 12y ago
  It will likely come down to that but since utilities are typically government-granted monopolies, it will take legislative action to allow changes. It will be a tough political sell since it would actively discourage new investment in distributed renewables and socialize the costs so that the people who used the most energy (and therefore drive most of the demand for T&D) will pay the smallest proportion of their upkeep.

gerbal 12y ago

I think it's that power companies depend on a very broad customer base to support their substantial capital investments. When you start removing a small portion of customers the cost of power to everyone else starts going up. And if those customers aren't consistently off-grid, i.e. they still need grid power sometimes, that can actually raise power costs. Increasing generation capacity to meet demand spikes is expensive, and requires having large, expensive power stations waiting at the ready, just costing money.

dorfsmay 12y ago

Kurzweil said their efficiency doubles every two years, and that they would be able to meet 100% of our energy needs by ~ 2030: http://www.livescience.com/4824-solar-power-rule-20-years-futurists.html http://www.livescience.com/4824-solar-power-rule-20-years-fu...

teraflop 12y ago
> Kurzweil said their efficiency doubles every two years According to that article, he said the "use" of solar energy doubles every two years. Efficiency has been gradually improving, but it's definitely not doubling every two years. Every few decades would be closer; that said, using an exponential curve to model a function that's capped at 100% doesn't really make much sense in the first place. http://en.wikipedia.org/wiki/File:PVeff(rev141113).jpg http://en.wikipedia.org/wiki/File:PVeff(rev141113).jpg