Utility Rates

Knd870 · December 2010

I've read this forum for about a month and have learned a great deal.

We are intending to build a new house in North Georgia in 2 - 3 years, so I'm exploring ways of lowering our utility bills and this is how I found this site.
I just recently received the electrical rates for this location and the way they have structured their renewable energy program looks like it is going to be difficult to make the financial justification work out (although there are other considerations in making the decision).
Their usage rates go from 9.9 cents per kWh to 6 cents per kWh. The net meter on a monthly basis, and buy back at a fixed 3.8 cents.

What really hurts the payback calculations is that the service charge is $18 per month for normal connection, but they add $11.15 per month for the net meter and administration. The sales tax rate in this area is 7%.

What are your opinions of the feasibility of a grid tied system under these conditions? Also, for new construction is it possible to get a GT system installed for $5 per watt? Finally, do any of you have any regrets after installing a system?

Thanks in advance for the feedback.

mike95490 · December 2010

Re: Utility Rates

no regrets. When I sold house, I added cost of solar to agents asking price, sold in <60 days

solar_dave · December 2010

Re: Utility Rates

No regrets, last months bill was $23 and of that $5 was for night time generation for off peak.

Makes it nice for a retirement cost control on fixed income.

BB. · December 2010

Re: Utility Rates

At this point--economically it does not make sense... Just focus on conservation for your home (lots of insulation, double pane windows, perhaps a heat recovery/air to air heat exchanger for good ventilation and lower heating/cooling costs, etc.). Depending on your climate, where you site windows, shading, winter/summer heat gain, etc. -- you can make a low energy usage home.

In general, conservation is usually the best place to spend you money anyway...

-Bill

n3qik · December 2010

Re: Utility Rates

With new construction, take the 20-30K for the solar and spend it on better items/construction of the house.

1. Extra insulation in attic
2. Extra thick outside walls
3. Ground source heat pump
4.Light fixtures that use CFL/LED and look good

peakbagger · December 2010

Re: Utility Rates

If you want financial payback, spend the money on efficiency. Solar panels only work out financially when others are subsidizing them. and thse subsidies change from year to year. The federal 30% rebate is gone as Dec 31st. Take the money you would have spent and spend it on efficiency improvements listed in the previous post.

Note I have grid tied solar systems, that I installed (total 1.6 Killowatts of panels), they were fun to install and its nice to generate most of my own power, but the economics just dont currently make sense. One of the systems is 8 years old, compared to spending money on a car or something else, its still running and still offsetting part of my electric bill, but I would have been far better putting the money in an investment and paying my electric bill from it.

At a minimum it would make sense to have a spare conduit run from the basement to the roof and cap it off. Given your utilities lousy rate structure for feed inm I dont see it being used anytime soon but its a lot easier to install aconduti when the hous eis being built.

Solar Guppy · December 2010

Re: Utility Rates

For GA, in order of best payback

R40 Ceilings
R21 Walls
Double pane Windows
Ground source heat pump
heat-pump hot water tank

For the cost of a moderate sized solar electric system you can do all of the above and have probably have 10X better payback

At 3.8 cents for selling, you could never, and I mean never get your money back, ( you would keep replacing inverters every 7-10 years )

Knd870 · December 2010

Re: Utility Rates

BB. wrote: »

At this point--economically it does not make sense... Just focus on conservation for your home (lots of insulation, double pane windows, perhaps a heat recovery/air to air heat exchanger for good ventilation and lower heating/cooling costs, etc.). Depending on your climate, where you site windows, shading, winter/summer heat gain, etc. -- you can make a low energy usage home.

In general, conservation is usually the best place to spend you money anyway...

-Bill

Thanks Bill,
The area that we are building requires all homes to be to Earth Craft standards, so it is going to be a relatively energy efficient home. I'm looking into a ground source heat pump, but don't think the savings will be worth the extra costs, as vertical loops will be required and the drilling is almost exclusively in rock. I'm thinking of a high efficient dual speed air source heat pump, but won't decide until I actually get the Manual J calculations and get with a mechanical contractor.

See here for a very interesting hot water idea: http://www.olivetreeenergy.com/dealer/zeroenergy-dealer-introduction

Someone over at the geothermal website is installing one of these for a client and is supposed to be measuring power usage before and after.

If I can get a system installed for $5 or $5.50 per watt, I think it might work, because Geogia has a 35% tax rebate up to $10,500.

Knd870 · December 2010

Re: Utility Rates

n3qik wrote: »

With new construction, take the 20-30K for the solar and spend it on better items/construction of the house.

1. Extra insulation in attic
2. Extra thick outside walls
3. Ground source heat pump
4.Light fixtures that use CFL/LED and look good

Ken,
Thanks. See my answer to Bill. Personally, I've had terrible experience with CFL. They die early, and put out very unpleasant light. We have 3 LED lights in our current house as a test for future use. So far they are much superior to the CFL's, as they are more efficient and the light temperature is much more pleasant. The only downside is I think it may take more fixtures to provide proper light levels - but we are definitely going to explore LED's.

Knd870 · December 2010

Re: Utility Rates

peakbagger wrote: »

If you want financial payback, spend the money on efficiency. Solar panels only work out financially when others are subsidizing them. and thse subsidies change from year to year. The federal 30% rebate is gone as Dec 31st.

At a minimum it would make sense to have a spare conduit run from the basement to the roof and cap it off. Given your utilities lousy rate structure for feed inm I dont see it being used anytime soon but its a lot easier to install aconduti when the hous eis being built.

Peak,
Thanks. I didn't realize the federal rebate ends this year. I was told they run until the end of 2014. That's a deal killer for me as we won't start building until late 2011 at the earliest.

The conduit run is a great idea - thanks.

Knd870 · December 2010

Re: Utility Rates

Solar Guppy wrote: »

For GA, in order of best payback

R40 Ceilings
R21 Walls
Double pane Windows
Ground source heat pump
heat-pump hot water tank

For the cost of a moderate sized solar electric system you can do all of the above and have probably have 10X better payback

At 3.8 cents for selling, you could never, and I mean never get your money back, ( you would keep replacing inverters every 7-10 years )

Thanks SG. I was thinking this might be still viable with the federal and state rebate, but with the fed rebate ending this year it doesn't look too good. Not sure ground source heatpump is possible as the vertical loops will be in rock (I've been told about $15/foot drilling costs).

BB. · December 2010

Re: Utility Rates

Right now--You might get Grid Tied installed (turnkey) for $6-$7 per watt (I am not in the business--get a couple quotes and find out the real price in your area).

And even then, I would still plan on replacing the GT inverter every 10 years or so. Add the uncertainty to how your electric utility will bill for Net Metered power (yours is pretty close to what I would think makes commercial sense for an electric utility that is not subsidizing solar power with money from other customers' pockets--which is not "green" / "government" friendly).

Keep an eye on next year's tax credits--You may get an interesting point where the vendor will have to reduce costs to near the cost-credit price if there are no credits... And if there are credits, the price of the system will probably go up about the price of the credits...

What kind of fuels do you have? (natural gas, propane, etc.)... At this time, an all electric home (with heat pump hot water, etc.) may actually be cheaper than running the stove and dryer from propane.

I would suggest that if you choose the all electric or mostly electric home--that you install piping for natural gas/propane appliances as a backup. If electric power goes sky high (in northern California, we have marginal power rates of $0.40 to $0.60+ per kWH--and those prices hit businesses and homes with A/C at ~1,000+ kWH per month in my region).

At this point, conservation and fuel flexibility may help you ride through this uncertain future.

-Bill

Knd870 · December 2010

Re: Utility Rates

peakbagger wrote: »

The federal 30% rebate is gone as Dec 31st.

Peak,
I just found this which states the 30% federal rebate for solar systems doesn't end until 12/31/2016.

http://www.dsireusa.org/incentives/incentive.cfm?Incentive_Code=US37F&re=1&ee=1

Which is correct?

solar_dave · December 2010

Re: Utility Rates

Knd870 wrote: »

Thanks SG. I was thinking this might be still viable with the federal and state rebate, but with the fed rebate ending this year it doesn't look too good. Not sure ground source heatpump is possible as the vertical loops will be in rock (I've been told about $15/foot drilling costs).

Fed rebate for solar doesn't end till 2016 I believe, see the IRS 5695 form

Solar Panels, Fuel Cell Power Plants, Geothermal and Wind (aka Residential Energy Efficient Property Credit)
The following types of equipment are eligible for a 30% tax credit with no maximum tax credit amount and are available through December 31, 2016.

* Solar panels,
* Solar-powered water heaters,
* Geothermal heat pumps,
* Photovoltaic systems,
* Small wind energy systems, and
* Fuel cells.

http://taxes.about.com/od/deductionscredits/qt/energytaxcredit.htm

Knd870 · December 2010

Re: Utility Rates

BB. wrote: »

Right now--You might get Grid Tied installed (turnkey) for $6-$7 per watt (I am not in the business--get a couple quotes and find out the real price in your area).

And even then, I would still plan on replacing the GT inverter every 10 years or so. Add the uncertainty to how your electric utility will bill for Net Metered power (yours is pretty close to what I would think makes commercial sense for an electric utility that is not subsidizing solar power with money from other customers' pockets--which is not "green" / "government" friendly).

Keep an eye on next year's tax credits--You may get an interesting point where the vendor will have to reduce costs to near the cost-credit price if there are no credits... And if there are credits, the price of the system will probably go up about the price of the credits...

What kind of fuels do you have? (natural gas, propane, etc.)... At this time, an all electric home (with heat pump hot water, etc.) may actually be cheaper than running the stove and dryer from propane.

I would suggest that if you choose the all electric or mostly electric home--that you install piping for natural gas/propane appliances as a backup. If electric power goes sky high (in northern California, we have marginal power rates of $0.40 to $0.60+ per kWH--and those prices hit businesses and homes with A/C at ~1,000+ kWH per month in my region).

At this point, conservation and fuel flexibility may help you ride through this uncertain future.

-Bill

Thanks Bill,
The house will be all electric with a buried 250 gallon propane tank for the fireplaces (or anything else I want but electric is much cheaper). I'm told we must have the propane tank, so we'll probably have some kind of back up heat from this, just in case.

I was kind of hoping that with new construction the installation cost might be cheaper. I've put together a spreadsheet calculating the NPV of a system and an 8 kW system. Still tweaking it and it has some broad assumptions on electrical use based upon our current house in Texas, but the number doesn't look too bad assuming the federal and state rebates still apply.

Once I'm comfortable with it I'll post it for comment.

solar_dave · December 2010

Re: Utility Rates

Knd870 wrote: »

Their usage rates go from 9.9 cents per kWh to 6 cents per kWh.

Man can I get those buy rates, CHEEEEEEEEEAAAAAAAAAAP.

You really need to sit down with a sharp pencil and calculate you loads and figure out how much solar makes sense if grid tie. One nice thing about grid tie is the production is usually during the highest rate period and you can be pretty much assured of at least offsetting some of your peak costs.

As others have said conservation is your friend, and other fuels for some things make perfect sense if the cost is low enough. You have the perfect opportunity to build in conservation in your new construction. Perhaps passive solar can play a roll for heating, and good design will reduce your cooling loads. CFL and LED will cut back on the lighting load. Using energy star appliances will help the things like fridge and freezers.

BB. · December 2010

Re: Utility Rates

The other question to ask is power security... In many areas, being at the end of the line means it may take 2-3+ weeks to get power back online after an Ice Storm or Hurricane.

Then fuel storage (propane, diesel) and generator vs a Hybrid solar system (solar panels batteries plus on-grid/off-grid capable inverter) may be something to think about.

Storage for food+medicine storage, domestic water, cooking, water heating, etc. without power--Then those propane and solar powered backup appliances start looking very nice.

Running extra wiring for battery/generator backed circuits (a couple outlets per room, some overhead lighting, sump pump, etc.) may be handy in the future too. It is a lot easier to home run some wiring / piping before the walls are covered.

Having natural gas for heat, cooking, hot water, etc. was always very nice over the decades. Everyone kept warm and fed with natural gas--And electricity was only needed for a refrigerator and doing the wash once in a while (plus tv+computers+battery operated device chargers these days).

At least in our area--the last long term power outage (~1 week) was ~50 years ago.

-Bill

solarvic · December 2010

Re: Utility Rates

Knd870 wrote: »

Thanks Bill,
The house will be all electric with a buried 250 gallon propane tank for the fireplaces (or anything else I want but electric is much cheaper). I'm told we must have the propane tank, so we'll probably have some kind of back up heat from this, just in case.

I was kind of hoping that with new construction the installation cost might be cheaper. I've put together a spreadsheet calculating the NPV of a system and an 8 kW system. Still tweaking it and it has some broad assumptions on electrical use based upon our current house in Texas, but the number doesn't look too bad assuming the federal and state rebates still apply.

Once I'm comfortable with it I'll post it for comment.

I didn,t know you could bury a propane tank. I am preety sure they don,t allow that in Pa. Here there is lots of acid in the ground and it eats up metal that is buryed in the ground. Solarvic

jcgee88 · December 2010

Re: Utility Rates

solar_dave wrote: »

Fed rebate for solar doesn't end till 2016 I believe, see the IRS 5695 form

People are confusing the 30% Federal tax credit on solar
with the 30% tax credit on energy efficiency enhancements.
The latter does end on 12/31/10, and it covers installing
high efficiency furnace/water heater, insulation, windows,
etc.

Not to nitpick, but the solar deal is not a rebate, it's a
tax credit, applied against your 2010 Federal income tax
liability. Now, various states also offer incentives, and
those likely are true rebates (like mine in Missouri).

John

Knd870 · December 2010

Re: Utility Rates

jcgee88 wrote: »

People are confusing the 30% Federal tax credit on solar
with the 30% tax credit on energy efficiency enhancements.
The latter does end on 12/31/10, and it covers installing
high efficiency furnace/water heater, insulation, windows,
etc.

Not to nitpick, but the solar deal is not a rebate, it's a
tax credit, applied against your 2010 Federal income tax
liability. Now, various states also offer incentives, and
those likely are true rebates (like mine in Missouri).

John

Thanks John. I knew how it works, just used the rebate term instead of the correct term credit. In Georgia it is also a credit that can be carried forward up to 5 years I beleive.

Knd870 · December 2010

Re: Utility Rates

BB. wrote: »

And even then, I would still plan on replacing the GT inverter every 10 years or so. -Bill

How about using the Enphase system, should I still assume replacement at 10 years?

Any of you Enphase users out there had any failures?

niel · December 2010

Re: Utility Rates

enphase has a 15yr warranty on their inverters, but we shall see if they are still around if the inverters start failing prior to that time. this was an in depth subject in another thread that we won't rehash here.

Knd870 · December 2010

Re: Utility Rates

niel wrote: »

enphase has a 15yr warranty on their inverters, but we shall see if they are still around if the inverters start failing prior to that time. this was an in depth subject in another thread that we won't rehash here.

I did an Enphase search and found a lenghty discussion concerning reliability.

I had no idea that these microinverters were so new. Only time will tell how reliable they are.

Thanks for pointing me in the right direction.

BB. · December 2010

Re: Utility Rates

I have not had an Enphase in my hands, or seen anything about there design and construction except what I have read.

At this point, it is wait and see.

-Bill

Knd870 · December 2010

Re: Utility Rates

All,
I have finished up my financial model and still think that PV will work for our new house based upon the assumptions I made. The biggest is our power consumption over a year in this all electric house. What I did was calculate the power consumption in our current home and then factored this for the new home. What I need is for your assessment of my assumptions. I will adjust from there and then see if the model still works. The big advantage of the model is that I will be rolling the cost of the PV system into my mortgage (another assumption), so the tax credits will actually work like I'm generating cash in the first year, with the additional mortgage cost being the negative cash in the subsequent years, declining in amount due to rate increases that I'm offsetting.

1) The new home is about the same square footage as our current home, but will be much more energy efficient. It will be a single story with a finished basement, and the current home is 2 stories on a slab, single pane windows. As well the cooling load will be less in Georgia, but the heating load will be more. In my model, heating load was about 50% higher than cooling.
2) Based upon the factors I applied to our current home, does it seem reasonable to consume approx 28,000 kWh for a year for a 3,500 square foot house (this is the new house)? The peak month would be about 4,300 kWh (Jan) and the lowest month would be about 1,100 kWh (Oct).

Thanks in advance for your comments.

n3qik · December 2010

Re: Utility Rates

solarvic wrote: »

I didn,t know you could bury a propane tank. I am preety sure they don,t allow that in Pa. Here there is lots of acid in the ground and it eats up metal that is buryed in the ground. Solarvic

I got a 500 gal. buried in back yard 2 years ago. That is the best place to put that big bomb.

Solar Guppy · December 2010

Re: Utility Rates

If your only getting 3.8 cents for excess, there is no way you can break even, ever

One thing I believe you are over looking is your PV generation will not match your load, so figure 50%+ of your PV will be sold back to the utility at 3.8 cents kWh as your loads in the house vary over the day,

Any moneys your considering on PV should be put to energy efficiency.

Just an observation, but you seem to be ignoring most posts in this regard and keep coming back on how PV will have a payback, which at 3.8 cents is impossible

It would help if you post a break down of your calculations, then we can point to specific point in the math

solar_dave · December 2010

Re: Utility Rates

Knd870 wrote: »

All,
I have finished up my financial model and still think that PV will work for our new house based upon the assumptions I made. The biggest is our power consumption over a year in this all electric house. What I did was calculate the power consumption in our current home and then factored this for the new home. What I need is for your assessment of my assumptions. I will adjust from there and then see if the model still works. The big advantage of the model is that I will be rolling the cost of the PV system into my mortgage (another assumption), so the tax credits will actually work like I'm generating cash in the first year, with the additional mortgage cost being the negative cash in the subsequent years, declining in amount due to rate increases that I'm offsetting.

1) The new home is about the same square footage as our current home, but will be much more energy efficient. It will be a single story with a finished basement, and the current home is 2 stories on a slab, single pane windows. As well the cooling load will be less in Georgia, but the heating load will be more. In my model, heating load was about 50% higher than cooling.
2) Based upon the factors I applied to our current home, does it seem reasonable to consume approx 28,000 kWh for a year for a 3,500 square foot house (this is the new house)? The peak month would be about 4,300 kWh (Jan) and the lowest month would be about 1,100 kWh (Oct).

Thanks in advance for your comments.

My peak usage in PHX AZ was in July with 3144 kWh with a 2500 sq ft house well insulated, Energy Star appliances and 1 out of 2 AC units as Energy Star (old 10 seer going away next month, fingers crossed). This included an older 2HP pool pump running for 4 hours a day. Day time temps here hit as high as 115 F in July.

If you have done your conservation homework 4300 kWh may be a bit much. Your low consumption may be closer to the money, I used 921kWh in Oct. after replacing the pool pump with a VFD model.

Knd870 · December 2010

Re: Utility Rates

Solar Guppy wrote: »

If your only getting 3.8 cents for excess, there is no way you can break even, ever

One thing I believe you are over looking is your PV generation will not match your load, so figure 50%+ of your PV will be sold back to the utility at 3.8 cents kWh as your loads in the house vary over the day,

Any moneys your considering on PV should be put to energy efficiency.

Just an observation, but you seem to be ignoring most posts in this regard and keep coming back on how PV will have a payback, which at 3.8 cents is impossible

It would help if you post a break down of your calculations, then we can point to specific point in the math

SG,
It just dawned on me where the disconnect is, so I went back and looked at their Fact Sheet. The 3.8 cents is for generation in excess of use. So a smaller PV system that never exceeds usage will offset the higher rate.

I'm not ignoring your comments or suggestions, we intend to do several conservation measures - I have run the numbers and think that it can still work with the low interest rates that are available on home mortgages. The new house with have a southern facing roof that should be able to hold enough panels, but shading is a big concern and the lot is very wooded (although quite a steep dropoff).

Attached is the spreadsheet that I'm messing with.

Knd870 · December 2010

Re: Utility Rates

solar_dave wrote: »

My peak usage in PHX AZ was in July with 3144 kWh with a 2500 sq ft house well insulated, Energy Star appliances and 1 out of 2 AC units as Energy Star (old 10 seer going away next month, fingers crossed). This included an older 2HP pool pump running for 4 hours a day. Day time temps here hit as high as 115 F in July.

If you have done your conservation homework 4300 kWh may be a bit much. Your low consumption may be closer to the money, I used 921kWh in Oct. after replacing the pool pump with a VFD model.

Thanks Dave. When I first put this together I had a math error converting natural gas to kWh's for hot water and heating. I corrected the error but it looked too high to me, so thanks for your data and I'll adjust the model from this. I've posted the spreadsheet that I'm using to the economic analysis, and would appreciate any feedback. Basically I'm using the utility analysis to determine the PV savings and then loading that number into the economic analysis spreadsheet. The magic number to maximize the tax credit is a maximum installed cost of $30,000.

solar_dave · December 2010

Re: Utility Rates

Knd870 wrote: »

Thanks Dave. When I first put this together I had a math error converting natural gas to kWh's for hot water and heating. I corrected the error but it looked too high to me, so thanks for your data and I'll adjust the model from this. I've posted the spreadsheet that I'm using to the economic analysis, and would appreciate any feedback. Basically I'm using the utility analysis to determine the PV savings and then loading that number into the economic analysis spreadsheet. The magic number to maximize the tax credit is a maximum installed cost of $30,000.

Look at adding solar hot water as well, systems can be had for fairly reasonable outlay and are eligible for the 30% Fed credit. I had gas hot-water on an old lousy fired unit, but the wife is a greenie (happy wife, happy life) I replaced the whole thing for under 4K including an Energy Star gas fired unit as backup and that had to help me some as well.

Utility Rates

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