Greetings from the Great Liberal State of Massachusetts where I expect to have free and green electricity in a few years. Oh, and two tax credits and some income from selling our SRECs that will add from $1635 to $545 a year to our income over the next ten years.
No doubt about it, electricity is expensive out here in Western Massachusetts. The going rate is about 22 c/KWH but since we are getting ours from wind power it’s more like 25c/KWH. Fortunately we moved into a new and highly energy efficient house. We consume only about 6000 KWHs a year but full disclosure we use natural gas to heat, hardly carbon neutral but quite efficient and better than most alternatives in this cold and snowy state.
About a third of our neighbors have solar power so it was on our agenda to go solar as soon as we could figure out a way to pay for it. It came sooner than I anticipated, mainly because my father passed away. The only good thing about it was I was a beneficiary on some of his accounts. Was this Dad’s way of helping me go green? Once we looked into it though it was “Why isn’t everyone going solar?” and “Why the @#$% don’t developers just put solar panels on the house in the first place when they build them?” Come below the fold to discover just how easy and cheap it is to go solar.
A few caveats. It’s not possible for everyone to put solar panels on your roof (but if you have a yard, you might be able to put them there). A house with a southern exposure is kind of required and if trees are in the way it may not make sense. Even if you don’t have a roof facing south, some people make it work with roofs facing east and west by putting panels on both faces, but I suspect it requires more panels. If you live in a condo it may not be an option but it can’t hurt to petition for your share of the roof. Apartment dwellers: you are likely out of luck.
Assuming the above are not fatal problems, there’s obviously cost involved. Consumer Reports indicates most solar systems run in the $15K — $21K range. Ours will cost about $21K.
But we will get a 30% federal tax credit. Our net cost just dropped to $14,700.
The state of Massachusetts also will give us a $1000 tax credit. Net cost is now $13,700.
But wait, there’s more! In our state we can let other carbon emitters claim our environmentally friendly solar system for showing they are going green. These Solar Renewable Energy Credits (SRECs) will generate actual income, i.e. checks in the mail every year. We will be in the SREC-2 program, which will guarantee us an income of $9262.50 payable over ten years. Our net cost is now $4437.50.
Assuming 22c/KWH, our 6000 KWHs of electricity per year would cost us $1320 a year if we don’t go solar. This means our system will pay for itself in about three years and four months.
After that, assuming we don’t add appliances to increase our load, electricity essentially will become free AND we’ll be greener. In peak months we will put electricity into the grid receiving a credit from the power company. In winter months we will draw from our credit. So potentially there will be no more electric bills ever.
Solar panels do degrade (lose efficiency) very slowly over time, something like .5% a year. So eventually they will have to be replaced. And the inverters (which change the DC power generated by the panels into AC power) on a solar panel may go bad and have to be replaced. But that’s covered by our 20-year warranty. It’s likely though (me being 59) that I will be dead before our solar panels need replacement. If we move, I can potentially bring them with me, since I own them.
To me if you have the money or can finance its cost, buying solar panels is a no-brainer. Granted most states don’t offer solar tax credits like Massachusetts or have SREC programs. But many, particularly in the northeast, do have them. Even without them if you run the numbers you may be surprised by how fast these systems will pay for themselves all while reducing global warming. The government is basically giving you money to convince you to go green.
Run the numbers. With solar panels getting cheaper and more efficient it’s likely to continue to get cheaper. It might make sense to take out a loan to pay for them and instead of paying the electric company every month pay off the loan instead. Even with interest on the loan I’m betting you come out ahead and within five years or so electricity is likely to be free for you pretty much forever.
Here’s a solar energy website where you can get started.