68

KIPLINGER S I OCTOBER 2OO7

HOME I t s cheaper to install a system and you can even sell back to the grid.
By Robert Prick

PHOTOGRAPHS BY JUSTIN STEELE

SOLAR
finally pays off

KIPLINGER S I OCTOBER 2007

electric meter is turning generates depends on size, efficiency and sunlight.) Figure backward, and it gives him immense satisthe price, including installation, is $10,000 per kilowatt, so the total comes to $40,()()(). Through various rebates, credits faction. On a sunny day in his Washington, and tax breaks, some states pay half that cost. The federal SUE D.C., neighborhood, the solar panels government will also chip in 30% of the cost, up to $2,000. ., perched on his root catch enough rays to liiken together, those subsidies drop the total to $18,000. power his home and sell electricity back to Manufacturers say that solar panels will last 25 to 30 years, the utility. A solar-powered fountain burbles in his garden, and they guarantee them for 20 years. Assuming a 2(}-year near the tubes for his solar-powered hot-water heater. "There is no easier way to make money than to sit out here and enjoy life span, that averages out to a cost of $75 per month. the sunshine," he says. Assuming those generous state subsiPromoting a cleaner environment antl dies, you'll get your initial investment WEB RESOURCES knowing that the power he generates back in ten to 15 years, including fitravels back through the electric grid to nancing costs. The environmental benehis neighbors adds to MuUin's satisfacfit: 3 fewer tons of carbon dioxide tion. You might expect such altruism generated every year. from someone who works for the Boy Second to state subsidies in computhere's an abundance of Scouts of America-hes an executive in ing home solar economics are utility resources to help you add the Learning for Life divisionbut the rates, followed by the hours of daily solar power to your home. bottom line is, solar energy saves him sunshine. How much do rates trump Here's what you need to get started. money. Mullin has cut his electricity sunshine]'' Consider that a Boston PV bill by two-thirds, and when those savsystem saves about the same amount us A simple, soup-to-nuts primer ings cover the $10,000 up-front cost for one in Albuquerque, even though New on PV systems: www.nrel.qov/docs/ his system in ten or 12 years, his solar Mexico's sunny skies generate 25% fVO4osti/35297.pdf electricity will be free. more power, says Kaye. The money your state provides Depending on where you live, solarSelling power back to a utility cuts to help cover system costs, plus power systems (also called photovoltaic, costs as well. Forty-two states and the other payments and incentives: or PV, systems) could pay off for you, District of Columbia have laws that www.dsireusa.orq too. Says Noah Kaye, of the Solar Enerrequire utilities to buy power from gy Industries Association: "Surveys individuals. With such so-called netGet federal tax credits of up to show that most Americans would be metering arrangements, a utility must $2,000 for installing a qualified PV very interested in having a solar system, credit you at the retail ratethe rate energy system or solar water heater but most don t realize solar can power a you pay for powerwhen you send this year or next: www.enerqytax house economically." electricity to the grid. In effect, net meincentives.orq/consumers tering makes utilities into power banks, Another thing most people don't A calculator to figure out your it you feed more power in than you takt realize is rhat the economics of solar do costs and savings from a PV system: out in a given month, you store up not depend solely on how many hours www.clean-power.com/sharp credits for future use. the sun shines where you live. The real key to making a PV system pay off is You can even get cash from the utiliwhether your state offers a hefty fmancial incentive (more ty. Some states require utilities to pay once a year for any exthan half the U.S. population is covered by such subsidies). cess power your system generates, although at the wholesale Fat subsidies are why New Jerseynot a Sunbelt state rate. So, for example, you may buy power at 9 cents per kilohas the second-largest number of home PV systems in the watt-hour but sell it for only 2 cents per kilowatt-hour. U.S., after California. At the moment, 17 states offer rebates, Other states let you become your own power broker in adaccording to the North Carolina Solar Center (you can check dition to net metering. In New Jersey, for example, utilities the Solar Center's database at www.dsireusa.org to see what must invest in solar power, and the state has created a marincentives are available in your state). ket for privately generated solar electricity. A certificate is issued for every 1,000 kilowatt-hours generated, and utilities buy them for between $150 and $265 each. SUNSHINE ECONOMICS i-L-w BIG VARIADLES dictate whether a home PV Of course, solar-power systems vary somewhat in quality system makes economic sense. But in rough terms, and cost, and the panels vary dramatically in appearance. here's how the numbers break down in states with the Fat solar panels with visible rows of circles are still an opbest incentives: The average solar-power system is 4 kilowatts. tion. Svelte, monolithic panels in blue or black are on the (Think of kilowatts as the si:^e of the system. The power it market, although you'll pay a slight premium (up to 10%)
DAN M U L L I N S

THE

Solar TOOL KIT

7'

for them. For each kilowatt of power you want to generate, figure you'll need 80 square feet of panel. "Thin fiim" panels, which are barely thicker than the shingles they cover, are unobtrusive, but you'll need twice the square footage to generate the same amount of energy as traditional solar cells. But not everyone wants unobtrusive panels. Tony Clifford, president of Maryland-based Standard Solar, says that althdLigh mou ot his clients prefer sleek and subtle panels laid llai on L i root, some don't mind making a statement with (.ircle-ladt-n panels propped up to catch the sun at the perfect .mgle. "Beauty is in the eye of the beholder," he says.

PROJECTS

SMALL SCALE solar

ot quite ready to add solar panels to your roof but still want to catch some rays? You have other alternatives to make the sun pay you.

FUTURE BENEFITS
SIDE FROM SAVING on his Utility bill and banking good environmental karma, D.C. resident Dan Miillin says he enjoys another benefit of his PV sysrem: insurance against rising energy prices. That's a big incentive driving PV sales, say installers. And keeping a lid tin rising energy costs is also a major motivator for states to subsidize commercial, retail and home PV systems. Count on more stares to start or increase subsidy programs. By fostering home solar systems, states decentralize power production. That reduces the cost of expensive grids needed to transport power. Also, clean, renewable power saves envircjnmental costs by limiting fossil-fuel use. Solar-power experts are quick to point out that traditional power is subsidized, too. Of the $12 billion the federal government spent on energy subsidies last year, $10 billion went to traditional energy sources. Says Joe Schwartz, executive editor of Home Power magazine: "We don't live in a free market. Sure, incentives drive the market, but incentives lor renewable energy are simply evening out the market." As the price of generating conventional power has risen, the costs associated with solar power have fallen dramatically. Solar panels now cost 80% less than they did in the early 1980s, and system prices may drop 5% per year for at least the next few years. The crossover pointwhen falling PVlystem prices pass rising energy prices so that solar pays off without subsidies^is less than a decade away, say experts. Fot now, though, cutting the up-front investment is the challenge. Maryland, which im|iorts 25% of its power from other states, recently passed a law requiring utilities to buy .S{)[ar power from private suppliers. Malcolm Woolf, director ot the Maryland Energy Administration, foresees an energycredits market evolving in which utilities enter multiyear contracts with suppliers-even homeowners. Of course, solar power isn't all about economics. Standard Solar's Clifford points to some clients in the rolling hills of Virginia's hunt country. Virginia has no state incentives, but these families have invested in expensive solar-power systems anyway. "It's like buying a Toyota Prius," says Clifford. There's a certain set of the population who will pay a substantial sum to do the right thing." K

Solar water-heatlnq systems. Dark-panel collector boxes, from 40 to 80 square feet, trap solar heat and preheat cold water. The heated water then flows either to your existing hot-water tank or to a special tank. Such a system in cloudy Seattle will provide less than 5 0 % of the energy needed to heat hot water for a typical household. But in sunny Phoenix, the yield is 80%. System prices range from $2,000 to $8,000. Figure a six- to ten-year payback period on a $4,000 system. (The federal government will pick up 30% of the bill, up to $2,000.) Solar-powered attic fans. Lowering your attic's temperature on a hot summer day can dramatically reduce the load on your air conditioner. A solar-powered fan costs about $500 installed and can pay for itself in as few as two to three summers.

' A separate solar system provides Oan Mullin with hot water.