## Cost of solar PV installed.

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• Here is a simple calculation showing examples of the current economics for Solar PV in Houston.  I mentioned this is the HREG meeting last Sunday, so here are
Message 1 of 29 , Aug 1, 2009
Here is a simple calculation showing examples of the current economics for Solar PV in Houston.  I mentioned this is the HREG meeting last Sunday, so here are the numbers.  What it shows is the "Price" of installing a system of three sizes on a building (the upfront cash layout), from 100 kW, to 10 kW and 1 kW; then the Federal Tax Credit (which is now a rebate for commercial systems); and the Net cost of the solar installation for each size.  The next line is typical energy production (kWh) that the system would produce over the life of the system (25 years warranty).  Dividing the Net cost by energy produced gives the Cost of electricity with a solar PV system on a building: less than 12 cents/kWh for larger systems and nearly 15 cents/kWh for very small systems.

 Size 100 kW 10 kW 1 kW Price \$500,000.00 \$55,000.00 \$6,500.00 Fed \$150,000.00 \$16,500.00 \$1,950.00 Net \$350,000.00 \$38,500.00 \$4,550.00 Production kWh/25yr 3,000,000 300,000 30,000 Electricity Cost \$        0.117 \$      0.128 \$     0.152

• This doesn t factor in (1) the cost of capital or (2) increased property insurance rates. (1) If you assume 100% financing at mortgage rates of 5.25% for
Message 2 of 29 , Aug 2, 2009

This doesn’t factor in (1) the cost of capital or (2) increased property insurance rates.

(1)     If you assume 100% financing at mortgage rates of 5.25% for 25 years, the monthly payment for a \$38,500 system (10kW) would be \$230.71.  Using Chris’ estimated output for a 10kW system of 1000 kW/mo, that increases the cost to \$0.23/kwh.

(2)    I was recently quoted \$10 annually per \$1000 coverage on Texas Windstorm (possibly Houston is a bit less; I live in Lake Jackson, nearer the coast).  Federal flood insurance currently runs me \$2.61 per \$1000 coverage.  Homeowners insurance costs me \$3.73 per \$1000 of coverage.  Thus, for all 3 coverages, a total of \$16.34 per \$1000 of coverage.  Now, I don’t know what exactly solar panels and controls add compared to the cost of the rest of the house itself, but if we conservatively assume that it incrementally increases insurance costs only at 75% of the rate of the rest of the house, that is \$12.26 per \$1000, or for a \$38,500 installation (assuming we only insure for the net cost to us after federal subsidies, not the replacement cost of the system), then that is an extra \$472 per year, or \$0.039/kwh.  If insured at replacement cost, it will be correspondingly higher (I suspect you will be required by your insurance company to cover at replacement cost since that is what they are promising to do for you, and no federal subsidy will help them replace your system after a fire, hurricane, etc.).  If rates are lower in your area, or you don’t carry flood coverage, then rates would be somewhat lower.

With the cost of financing and the cost of insurance factored in, the cost would be approximately \$0.27/kwh for a 10 kW system.  Whereas \$0.128/kwh is similar to current REP rates, \$0.27/kwh is not.

Robert Johnston

From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of Chris Boyer
Sent: Saturday, August 01, 2009 10:27 PM
To: HREG
Subject: [hreg] Cost of solar PV installed.

Here is a simple calculation showing examples of the current economics for Solar PV in Houston.  I mentioned this is the HREG meeting last Sunday, so here are the numbers.  What it shows is the "Price" of installing a system of three sizes on a building (the upfront cash layout), from 100 kW, to 10 kW and 1 kW; then the Federal Tax Credit (which is now a rebate for commercial systems); and the Net cost of the solar installation for each size.  The next line is typical energy production (kWh) that the system would produce over the life of the system (25 years warranty).  Dividing the Net cost by energy produced gives the Cost of electricity with a solar PV system on a building: less than 12 cents/kWh for larger systems and nearly 15 cents/kWh for very small systems.

 Size 100 kW 10 kW 1 kW Price \$500,000.00 \$55,000.00 \$6,500.00 Fed \$150,000.00 \$16,500.00 \$1,950.00 Net \$350,000.00 \$38,500.00 \$4,550.00 Production kWh/25yr 3,000,000 300,000 30,000 Electricity Cost \$        0.117 \$      0.128 \$     0.152

• Greetings, Why would you factor 100% financing? Even mortgages require at least 5 or 10 percent down. Also, a 25 year term for a mere \$38,500? That is paying
Message 3 of 29 , Aug 2, 2009
Greetings,

Why would you factor 100% financing? Even mortgages require at least 5
or 10 percent down. Also, a 25 year term for a mere \$38,500? That is
paying less than \$2,000 a year in capital. Any financial adviser worth
their salt would tell you that is a bit silly, a 15 year period would be
pretty maximum. How many times over do you wish to pay for the system?

If you are going to include all of the joys of ownership, you should
also include the adjustments for the rising cost of electric, and the
final value of the system when it is paid for. Especially since when you
pay the grid, at the end of it all, you have nothing. It is like renting
a home vs owning a home. Initially it costs more to own, but in the long
run, it is soooooo much cheaper.

Bright Blessings,
Kim

Robert Johnston wrote:
>
>
> This doesn’t factor in (1) the cost of capital or (2) increased
> property insurance rates.
>
> (1) If you assume 100% financing at mortgage rates of 5.25% for 25
> years, the monthly payment for a \$38,500 system (10kW) would be
> \$230.71. Using Chris’ estimated output for a 10kW system of 1000
> kW/mo, that increases the cost to \$0.23/kwh.
>
> (2) I was recently quoted \$10 annually per \$1000 coverage on Texas
> Windstorm (possibly Houston is a bit less; I live in Lake Jackson,
> nearer the coast). Federal flood insurance currently runs me \$2.61 per
> \$1000 coverage. Homeowners insurance costs me \$3.73 per \$1000 of
> coverage. Thus, for all 3 coverages, a total of \$16.34 per \$1000 of
> coverage. Now, I don’t know what exactly solar panels and controls add
> compared to the cost of the rest of the house itself, but if we
> conservatively assume that it incrementally increases insurance costs
> only at 75% of the rate of the rest of the house, that is \$12.26 per
> \$1000, or for a \$38,500 installation (assuming we only insure for the
> net cost to us after federal subsidies, not the replacement cost of
> the system), then that is an extra \$472 per year, or \$0.039/kwh. If
> insured at replacement cost, it will be correspondingly higher (I
> suspect you will be required by your insurance company to cover at
> replacement cost since that is what they are promising to do for you,
> and no federal subsidy will help them replace your system after a
> fire, hurricane, etc.). If rates are lower in your area, or you don’t
> carry flood coverage, then rates would be somewhat lower.
>
>
> With the cost of financing and the cost of insurance factored in, the
> cost would be approximately \$0.27/kwh for a 10 kW system. Whereas
> \$0.128/kwh is similar to current REP rates, \$0.27/kwh is not.
>
> Robert Johnston
>
> *From:* hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] *On Behalf
> Of *Chris Boyer
> *Sent:* Saturday, August 01, 2009 10:27 PM
> *To:* HREG
> *Subject:* [hreg] Cost of solar PV installed.
>
> Here is a simple calculation showing examples of the current economics
> for Solar PV in Houston. I mentioned this is the HREG meeting last
> Sunday, so here are the numbers. What it shows is the "Price" of
> installing a system of three sizes on a building (the upfront cash
> layout), from 100 kW, to 10 kW and 1 kW; then the Federal Tax Credit
> (which is now a rebate for commercial systems); and the Net cost of
> the solar installation for each size. The next line is typical energy
> production (kWh) that the system would produce over the life of the
> system (25 years warranty). Dividing the Net cost by energy produced
> gives the Cost of electricity with a solar PV system on a building:
> less than 12 cents/kWh for larger systems and nearly 15 cents/kWh for
> very small systems.
>
> Size
>
>
>
> 100 kW
>
>
>
> 10 kW
>
>
>
> 1 kW
>
> Price
>
>
>
> \$500,000.00
>
>
>
> \$55,000.00
>
>
>
> \$6,500.00
>
> Fed
>
>
>
> \$150,000.00
>
>
>
> \$16,500.00
>
>
>
> \$1,950.00
>
> Net
>
>
>
> \$350,000.00
>
>
>
> \$38,500.00
>
>
>
> \$4,550.00
>
> Production
>
>
>
>
>
> kWh/25yr
>
>
>
> 3,000,000
>
>
>
> 300,000
>
>
>
> 30,000
>
> Electricity
>
>
>
>
>
> Cost
>
>
>
> \$ 0.117
>
>
>
> \$ 0.128
>
>
>
> \$ 0.152
>
>
>
>
• Well you probably wouldn t get 100% financing over 25 years, but a ROI calculation would assume you do. Financially speaking, a PV system is like a
Message 4 of 29 , Aug 2, 2009
Well you probably wouldn't get 100% financing over 25 years, but a ROI calculation would assume you do. Financially speaking, a PV system is like a certificate of deposit (CD) where you pay, say, a \$38,500 up front, but then get back, say, \$120 each month.

You set the term to the useful life of the investment. So if the system survives 25 years you get 25 years of payments, and you evaluate it over a 25 year interval. You don't actually have to get a 25 year loan.

In fact, you don't even have to get a loan at all. You could pay cash and the analysis doesn't change. You don't think of an investment costs a month; you think of what it produces each month.

I hope that helps!

--- In hreg@yahoogroups.com, Garth & Kim Travis <gartht@...> wrote:
>
> Greetings,
>
> Why would you factor 100% financing? Even mortgages require at least 5
> or 10 percent down. Also, a 25 year term for a mere \$38,500? That is
> paying less than \$2,000 a year in capital. Any financial adviser worth
> their salt would tell you that is a bit silly, a 15 year period would be
> pretty maximum. How many times over do you wish to pay for the system?
>
> If you are going to include all of the joys of ownership, you should
> also include the adjustments for the rising cost of electric, and the
> final value of the system when it is paid for. Especially since when you
> pay the grid, at the end of it all, you have nothing. It is like renting
> a home vs owning a home. Initially it costs more to own, but in the long
> run, it is soooooo much cheaper.
>
> Bright Blessings,
> Kim
>
> Robert Johnston wrote:
> >
> >
> > This doesn't factor in (1) the cost of capital or (2) increased
> > property insurance rates.
> >
> > (1) If you assume 100% financing at mortgage rates of 5.25% for 25
> > years, the monthly payment for a \$38,500 system (10kW) would be
> > \$230.71. Using Chris' estimated output for a 10kW system of 1000
> > kW/mo, that increases the cost to \$0.23/kwh.
> >
> > (2) I was recently quoted \$10 annually per \$1000 coverage on Texas
> > Windstorm (possibly Houston is a bit less; I live in Lake Jackson,
> > nearer the coast). Federal flood insurance currently runs me \$2.61 per
> > \$1000 coverage. Homeowners insurance costs me \$3.73 per \$1000 of
> > coverage. Thus, for all 3 coverages, a total of \$16.34 per \$1000 of
> > coverage. Now, I don't know what exactly solar panels and controls add
> > compared to the cost of the rest of the house itself, but if we
> > conservatively assume that it incrementally increases insurance costs
> > only at 75% of the rate of the rest of the house, that is \$12.26 per
> > \$1000, or for a \$38,500 installation (assuming we only insure for the
> > net cost to us after federal subsidies, not the replacement cost of
> > the system), then that is an extra \$472 per year, or \$0.039/kwh. If
> > insured at replacement cost, it will be correspondingly higher (I
> > suspect you will be required by your insurance company to cover at
> > replacement cost since that is what they are promising to do for you,
> > and no federal subsidy will help them replace your system after a
> > fire, hurricane, etc.). If rates are lower in your area, or you don't
> > carry flood coverage, then rates would be somewhat lower.
> >
> >
> > With the cost of financing and the cost of insurance factored in, the
> > cost would be approximately \$0.27/kwh for a 10 kW system. Whereas
> > \$0.128/kwh is similar to current REP rates, \$0.27/kwh is not.
> >
> > Robert Johnston
> >
> > *From:* hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] *On Behalf
> > Of *Chris Boyer
> > *Sent:* Saturday, August 01, 2009 10:27 PM
> > *To:* HREG
> > *Subject:* [hreg] Cost of solar PV installed.
> >
> > Here is a simple calculation showing examples of the current economics
> > for Solar PV in Houston. I mentioned this is the HREG meeting last
> > Sunday, so here are the numbers. What it shows is the "Price" of
> > installing a system of three sizes on a building (the upfront cash
> > layout), from 100 kW, to 10 kW and 1 kW; then the Federal Tax Credit
> > (which is now a rebate for commercial systems); and the Net cost of
> > the solar installation for each size. The next line is typical energy
> > production (kWh) that the system would produce over the life of the
> > system (25 years warranty). Dividing the Net cost by energy produced
> > gives the Cost of electricity with a solar PV system on a building:
> > less than 12 cents/kWh for larger systems and nearly 15 cents/kWh for
> > very small systems.
> >
> > Size
> >
> >
> >
> > 100 kW
> >
> >
> >
> > 10 kW
> >
> >
> >
> > 1 kW
> >
> > Price
> >
> >
> >
> > \$500,000.00
> >
> >
> >
> > \$55,000.00
> >
> >
> >
> > \$6,500.00
> >
> > Fed
> >
> >
> >
> > \$150,000.00
> >
> >
> >
> > \$16,500.00
> >
> >
> >
> > \$1,950.00
> >
> > Net
> >
> >
> >
> > \$350,000.00
> >
> >
> >
> > \$38,500.00
> >
> >
> >
> > \$4,550.00
> >
> > Production
> >
> >
> >
> >
> >
> > kWh/25yr
> >
> >
> >
> > 3,000,000
> >
> >
> >
> > 300,000
> >
> >
> >
> > 30,000
> >
> > Electricity
> >
> >
> >
> >
> >
> > Cost
> >
> >
> >
> > \$ 0.117
> >
> >
> >
> > \$ 0.128
> >
> >
> >
> > \$ 0.152
> >
> >
> >
> >
>
• Good points all. At the Solar 2009 conference a few months ago I heard a very interesting analogy made. The premise was that if you invested in a 1.5 kw PV
Message 5 of 29 , Aug 2, 2009
Good points all.

At the Solar 2009 conference a few months ago I heard a very interesting
analogy made. The premise was that if you invested in a 1.5 kw PV system and
drove an electric vehicle for the next 30 years, you would essentially have
paid for 30 years worth of fuel with the PV system. I don't remember all the
specific assumptions, but it assumed a useful life of 30 years for the pv.

1.5KW @ \$10,000 x .7 Federal Tax Credit = \$7,000/30 years = \$233/year.
Compared to a 25 mpg vehicle, current gasoline costs would be at least
\$800/year, and aren't likely to decline over 30 years time, but you could
also assume mileage improvements would be par with rising fuel costs.

I know you can take the example apart because of the assumptions and
simplified math, but the point was by investing in pv/ev you were displacing
foreign oil payments and reducing the trade deficit, spending the money
domestically and stimulating a growing industry, reducing CO2 and other
climate changing emissions, encouraging distributed energy on the grid as
well as saving money personally, over \$15,000.

As Kim alluded, the benefits aren't just financial; intangibles such as the
personal pride, enjoyment and fulfillment that come from ownership have
different values to different people.

Kevin Conlin
Heliosolar Design, Inc.
13534 Quetzal Lane
Houston, TX 77083
C: (281) 202-9629
H: (281) 530-7501
F: (281) 530-7501
kevin@...

-----Original Message-----
From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of Garth
& Kim Travis
Sent: Sunday, August 02, 2009 3:40 PM
To: hreg@yahoogroups.com
Subject: Re: [hreg] Cost of solar PV installed.

Greetings,

Why would you factor 100% financing? Even mortgages require at least 5 or 10
percent down. Also, a 25 year term for a mere \$38,500? That is paying less
than \$2,000 a year in capital. Any financial adviser worth their salt would
tell you that is a bit silly, a 15 year period would be pretty maximum. How
many times over do you wish to pay for the system?

If you are going to include all of the joys of ownership, you should also
include the adjustments for the rising cost of electric, and the final value
of the system when it is paid for. Especially since when you pay the grid,
at the end of it all, you have nothing. It is like renting a home vs owning
a home. Initially it costs more to own, but in the long run, it is soooooo
much cheaper.

Bright Blessings,
Kim

Robert Johnston wrote:
>
>
> This doesn't factor in (1) the cost of capital or (2) increased
> property insurance rates.
>
> (1) If you assume 100% financing at mortgage rates of 5.25% for 25
> years, the monthly payment for a \$38,500 system (10kW) would be
> \$230.71. Using Chris' estimated output for a 10kW system of 1000
> kW/mo, that increases the cost to \$0.23/kwh.
>
> (2) I was recently quoted \$10 annually per \$1000 coverage on Texas
> Windstorm (possibly Houston is a bit less; I live in Lake Jackson,
> nearer the coast). Federal flood insurance currently runs me \$2.61 per
> \$1000 coverage. Homeowners insurance costs me \$3.73 per \$1000 of
> coverage. Thus, for all 3 coverages, a total of \$16.34 per \$1000 of
> coverage. Now, I don't know what exactly solar panels and controls add
> compared to the cost of the rest of the house itself, but if we
> conservatively assume that it incrementally increases insurance costs
> only at 75% of the rate of the rest of the house, that is \$12.26 per
> \$1000, or for a \$38,500 installation (assuming we only insure for the
> net cost to us after federal subsidies, not the replacement cost of
> the system), then that is an extra \$472 per year, or \$0.039/kwh. If
> insured at replacement cost, it will be correspondingly higher (I
> suspect you will be required by your insurance company to cover at
> replacement cost since that is what they are promising to do for you,
> and no federal subsidy will help them replace your system after a
> fire, hurricane, etc.). If rates are lower in your area, or you don't
> carry flood coverage, then rates would be somewhat lower.
>
>
> With the cost of financing and the cost of insurance factored in, the
> cost would be approximately \$0.27/kwh for a 10 kW system. Whereas
> \$0.128/kwh is similar to current REP rates, \$0.27/kwh is not.
>
> Robert Johnston
>
> *From:* hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] *On Behalf
> Of *Chris Boyer
> *Sent:* Saturday, August 01, 2009 10:27 PM
> *To:* HREG
> *Subject:* [hreg] Cost of solar PV installed.
>
> Here is a simple calculation showing examples of the current economics
> for Solar PV in Houston. I mentioned this is the HREG meeting last
> Sunday, so here are the numbers. What it shows is the "Price" of
> installing a system of three sizes on a building (the upfront cash
> layout), from 100 kW, to 10 kW and 1 kW; then the Federal Tax Credit
> (which is now a rebate for commercial systems); and the Net cost of
> the solar installation for each size. The next line is typical energy
> production (kWh) that the system would produce over the life of the
> system (25 years warranty). Dividing the Net cost by energy produced
> gives the Cost of electricity with a solar PV system on a building:
> less than 12 cents/kWh for larger systems and nearly 15 cents/kWh for
> very small systems.
>
> Size
>
>
>
> 100 kW
>
>
>
> 10 kW
>
>
>
> 1 kW
>
> Price
>
>
>
> \$500,000.00
>
>
>
> \$55,000.00
>
>
>
> \$6,500.00
>
> Fed
>
>
>
> \$150,000.00
>
>
>
> \$16,500.00
>
>
>
> \$1,950.00
>
> Net
>
>
>
> \$350,000.00
>
>
>
> \$38,500.00
>
>
>
> \$4,550.00
>
> Production
>
>
>
>
>
> kWh/25yr
>
>
>
> 3,000,000
>
>
>
> 300,000
>
>
>
> 30,000
>
> Electricity
>
>
>
>
>
> Cost
>
>
>
> \$ 0.117
>
>
>
> \$ 0.128
>
>
>
> \$ 0.152
>
>
>
>

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• Kim, you ve raised some interesting points. I ll try to address each below. Assuming 100% financing at mortgage rates in the cost of capital calculation is
Message 6 of 29 , Aug 2, 2009
Kim, you've raised some interesting points. I'll try to address each below.

Assuming 100% financing at mortgage rates in the cost of capital calculation
is reasonable. Actually, it is conservative, since most people probably
couldn't finance at mortgage rates (i.e., they would have a higher interest
rate for a home improvement loan or whatever). If you only finance 90% (or
whatever), you still have a cost of capital associated with the remaining
10% that you had to pay out of pocket. That is capital not available to you
for some other purpose, such as paying down a different loan, or investing,
etc. So doing the calculation on the basis of 100% financing is the correct
approach for comparisons of this type, even if not the level of financing a
particular individual would choose to use (or be allowed by her bank).

As for the term, adjust it however you like. I used 25 years simply because
that is the estimated life of the product as used in Chris' calculations, so
I kept things on that basis. If you finance for less time, you pay less
interest, but you also have more capital tied up for longer. If you figured
the value of that (lost opportunity cost), I think it would work out to be
about the same as simply amortizing over 25 years as I did. In other words,
is if you think there is a greater return on capital for the money invested
in the solar system than in other investments. But that doesn't change the
fact that for a fair "apples vs. apples comparison" of costs one should
amortize over the life of the system.

You suggested an adjustment for the rising cost of electricity. The
forecasted increase is not that great if you factor in inflation. DOE
forecasts only 0.6%/yr increase in residential energy rates from 2007-2300.
for AEO under the U.S. Data Projections for Electricity). In short, rising
from 10.6 to 12.2 cents/kwh in 2007 dollars. Obviously, that only makes a
small dent in the difference between current REP rates and the cost of
PV-generated electricity under the assumptions used below. That small
increase may be offset on the PV side by the expected increase in insurance
costs over the life of the system.

You also suggested including "final value" or residual value estimate. I
did not because Chris did not. If the useful lifetime is 25 years, then the
estimates are accurate. If the useful life is longer, then both Chris' and
my estimates are too high and the actual cost of solar will prove less.
(But how much value there will be in a system in 25 years, I question. I
know very few technology devices that are desirable after 25 years! The
original homeowner will probably have moved on, and the buyer of a home in
25 years will prefer the technology available at that time, which will no
doubt be much improved, given the advances in technology. For example, what
if there is a new control scheme required to be installed to tie into a
nation-wide smart grid, or what if they want new battery technology for
storage, etc.? Does anyone know of many PV systems installed in the 1980
timeframe that are going strong today without significant interim
improvements/repairs?).

Your "pay the grid" argument is correct. That is why to do a fair
comparison, one should factor in cost of capital, since the grid has no
"upfront" capital cost to the homeowner. In reality, there **IS** a cost of
capital for electricity generation and distribution systems on the grid;
these are amortized and the homeowner pays for them over time in their
rates. So, to compare PV without cost of capital to the "grid" with cost of
capital is an inaccurate and misleading comparison.

Actually, owning a home can often be more expensive than renting. It is a
longstanding myth in America that homeownership is less expensive. In some
circumstances it is, in others not. Depends in part on the part of the
certainly is not without its risks, as homeowners in much of the nation
(thankfully not much in Texas--this time!) are learning. An interesting
blog on this topic can be found here:

That blog, in fact, is a good segue to make the point that, just as buying a
house vs. renting has certain nontangible benefits that people enjoy, so
owning a PV system brings certain nontangible benefits to people that some
people enjoy. In neither case, however, should one confuse these
nontangibles with the actual value or cost of a particular choice.
Regardless of whether we tweak the calculations a bit in the above areas or
not, I think that when one does the comparisons on a fair basis, taking into
account the cost of capital, etc., PV is on the order of 2.5 times the cost
of the "grid" (where one can also choose 100% renewable if one wishes to).
Incidentally, if one is trying to hedge against rising inflation or rising
energy costs, one can do that through any number of financial
instruments/investments that will likely provide higher returns, lower risk,
less maintenance, etc., than a PV system will entail.

I suspect some people wish I'd quit criticizing optimistic PV cost figures
that get posted here from time to time. I am not anti-PV! I just think we
should be honest with one another and accurately portray the true costs,
then let people make the decision that is best for them, factoring in
accurate financial costs as well as the intangibles. Raising false
expectations is not healthy for any industry, and I don't think the PV
industry is well-served by boosterism that inaccurately projects its costs.
(BTW, please note that I am NOT accusing Chris of boosterism! I don't know
the context of his calculations, and know him only as an enthusiastic
supporter and helpful user of renewable energy technologies. There's
nothing wrong with that--it is why this group exists!). For me personally,
PV should be a trouble-free system with costs equal to renewable energy
purchased on the grid with the full support of professional
crews/maintenance included. When that day comes, and I can make a sound
risk-adjusted return on my investment, I'll be interested. Until then, it
is a hobby/interest which I enjoy learning more about, including from people
like Chris with skin in the game.

Robert Johnston

-----Original Message-----
From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of Garth
& Kim Travis
Sent: Sunday, August 02, 2009 3:40 PM
To: hreg@yahoogroups.com
Subject: Re: [hreg] Cost of solar PV installed.

Greetings,

Why would you factor 100% financing? Even mortgages require at least 5
or 10 percent down. Also, a 25 year term for a mere \$38,500? That is
paying less than \$2,000 a year in capital. Any financial adviser worth
their salt would tell you that is a bit silly, a 15 year period would be
pretty maximum. How many times over do you wish to pay for the system?

If you are going to include all of the joys of ownership, you should
also include the adjustments for the rising cost of electric, and the
final value of the system when it is paid for. Especially since when you
pay the grid, at the end of it all, you have nothing. It is like renting
a home vs owning a home. Initially it costs more to own, but in the long
run, it is soooooo much cheaper.

Bright Blessings,
Kim

Robert Johnston wrote:
>
>
> This doesn't factor in (1) the cost of capital or (2) increased
> property insurance rates.
>
> (1) If you assume 100% financing at mortgage rates of 5.25% for 25
> years, the monthly payment for a \$38,500 system (10kW) would be
> \$230.71. Using Chris' estimated output for a 10kW system of 1000
> kW/mo, that increases the cost to \$0.23/kwh.
>
> (2) I was recently quoted \$10 annually per \$1000 coverage on Texas
> Windstorm (possibly Houston is a bit less; I live in Lake Jackson,
> nearer the coast). Federal flood insurance currently runs me \$2.61 per
> \$1000 coverage. Homeowners insurance costs me \$3.73 per \$1000 of
> coverage. Thus, for all 3 coverages, a total of \$16.34 per \$1000 of
> coverage. Now, I don't know what exactly solar panels and controls add
> compared to the cost of the rest of the house itself, but if we
> conservatively assume that it incrementally increases insurance costs
> only at 75% of the rate of the rest of the house, that is \$12.26 per
> \$1000, or for a \$38,500 installation (assuming we only insure for the
> net cost to us after federal subsidies, not the replacement cost of
> the system), then that is an extra \$472 per year, or \$0.039/kwh. If
> insured at replacement cost, it will be correspondingly higher (I
> suspect you will be required by your insurance company to cover at
> replacement cost since that is what they are promising to do for you,
> and no federal subsidy will help them replace your system after a
> fire, hurricane, etc.). If rates are lower in your area, or you don't
> carry flood coverage, then rates would be somewhat lower.
>
>
> With the cost of financing and the cost of insurance factored in, the
> cost would be approximately \$0.27/kwh for a 10 kW system. Whereas
> \$0.128/kwh is similar to current REP rates, \$0.27/kwh is not.
>
> Robert Johnston
>
> *From:* hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] *On Behalf
> Of *Chris Boyer
> *Sent:* Saturday, August 01, 2009 10:27 PM
> *To:* HREG
> *Subject:* [hreg] Cost of solar PV installed.
>
> Here is a simple calculation showing examples of the current economics
> for Solar PV in Houston. I mentioned this is the HREG meeting last
> Sunday, so here are the numbers. What it shows is the "Price" of
> installing a system of three sizes on a building (the upfront cash
> layout), from 100 kW, to 10 kW and 1 kW; then the Federal Tax Credit
> (which is now a rebate for commercial systems); and the Net cost of
> the solar installation for each size. The next line is typical energy
> production (kWh) that the system would produce over the life of the
> system (25 years warranty). Dividing the Net cost by energy produced
> gives the Cost of electricity with a solar PV system on a building:
> less than 12 cents/kWh for larger systems and nearly 15 cents/kWh for
> very small systems.
>
> Size
>
>
>
> 100 kW
>
>
>
> 10 kW
>
>
>
> 1 kW
>
> Price
>
>
>
> \$500,000.00
>
>
>
> \$55,000.00
>
>
>
> \$6,500.00
>
> Fed
>
>
>
> \$150,000.00
>
>
>
> \$16,500.00
>
>
>
> \$1,950.00
>
> Net
>
>
>
> \$350,000.00
>
>
>
> \$38,500.00
>
>
>
> \$4,550.00
>
> Production
>
>
>
>
>
> kWh/25yr
>
>
>
> 3,000,000
>
>
>
> 300,000
>
>
>
> 30,000
>
> Electricity
>
>
>
>
>
> Cost
>
>
>
> \$ 0.117
>
>
>
> \$ 0.128
>
>
>
> \$ 0.152
>
>
>
>

------------------------------------

• I see you posted while I was composing my last post. Just a quick comment. Your last paragraph is the key one-for some people, the intangibles make it worth
Message 7 of 29 , Aug 2, 2009

I see you posted while I was composing my last post.  Just a quick comment…

Your last paragraph is the key one—for some people, the intangibles make it worth it.  That’s fine, so long as the true financial cost isn’t obscured.  Using the example of an electric vehicle just creates a mental image of something green and neat—free transportation fuel!  But from a financial perspective, one would want to do the comparison on the basis of the cost of metered electricity from the grid vs. the cost of electricity from PV—regardless of whether it is used for an electric car or for anything else you wanted it for.  In that case, the calculation must still factor in cost of capital etc. as I argued.  i.e., regardless of the use, one should just make the calculation on the basis of cost per kwh.

Robert

From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of Kevin Conlin
Sent: Sunday, August 02, 2009 5:13 PM
To: hreg@yahoogroups.com
Subject: [hreg] A different way to look at PV investment...

Good points all.

At the Solar 2009 conference a few months ago I heard a very interesting
analogy made. The premise was that if you invested in a 1.5 kw PV system and
drove an electric vehicle for the next 30 years, you would essentially have
paid for 30 years worth of fuel with the PV system. I don't remember all the
specific assumptions, but it assumed a useful life of 30 years for the pv.

1.5KW @ \$10,000 x .7 Federal Tax Credit = \$7,000/30 years = \$233/year.
Compared to a 25 mpg vehicle, current gasoline costs would be at least
\$800/year, and aren't likely to decline over 30 years time, but you could
also assume mileage improvements would be par with rising fuel costs.

I know you can take the example apart because of the assumptions and
simplified math, but the point was by investing in pv/ev you were displacing
foreign oil payments and reducing the trade deficit, spending the money
domestically and stimulating a growing industry, reducing CO2 and other
climate changing emissions, encouraging distributed energy on the grid as
well as saving money personally, over \$15,000.

As Kim alluded, the benefits aren't just financial; intangibles such as the
personal pride, enjoyment and fulfillment that come from ownership have
different values to different people.

Kevin Conlin
Heliosolar Design, Inc.
13534 Quetzal Lane
Houston, TX 77083
C: (281) 202-9629
H: (281) 530-7501
F: (281) 530-7501
kevin@...

-----Original Message-----
From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of Garth
& Kim Travis
Sent: Sunday, August 02, 2009 3:40 PM
To: hreg@yahoogroups.com
Subject: Re: [hreg] Cost of solar PV installed.

Greetings,

Why would you factor 100% financing? Even mortgages require at least 5 or 10
percent down. Also, a 25 year term for a mere \$38,500? That is paying less
than \$2,000 a year in capital. Any financial adviser worth their salt would
tell you that is a bit silly, a 15 year period would be pretty maximum. How
many times over do you wish to pay for the system?

If you are going to include all of the joys of ownership, you should also
include the adjustments for the rising cost of electric, and the final value
of the system when it is paid for. Especially since when you pay the grid,
at the end of it all, you have nothing. It is like renting a home vs owning
a home. Initially it costs more to own, but in the long run, it is soooooo
much cheaper.

Bright Blessings,
Kim

Robert Johnston wrote:

>
>
> This doesn't factor in (1) the cost of capital or (2) increased
> property insurance rates.
>
> (1) If you assume 100% financing at mortgage rates of 5.25% for 25
> years, the monthly payment for a \$38,500 system (10kW) would be
> \$230.71. Using Chris' estimated output for a 10kW system of 1000
> kW/mo, that increases the cost to \$0.23/kwh.
>
> (2) I was recently quoted \$10 annually per \$1000 coverage on Texas
> Windstorm (possibly Houston is a bit less; I live in Lake Jackson,
> nearer the coast). Federal flood insurance currently runs me \$2.61 per
> \$1000 coverage. Homeowners insurance costs me \$3.73 per \$1000 of
> coverage. Thus, for all 3 coverages, a total of \$16.34 per \$1000 of
> coverage. Now, I don't know what exactly solar panels and controls add
> compared to the cost of the rest of the house itself, but if we
> conservatively assume that it incrementally increases insurance costs
> only at 75% of the rate of the rest of the house, that is \$12.26 per
> \$1000, or for a \$38,500 installation (assuming we only insure for the
> net cost to us after federal subsidies, not the replacement cost of
> the system), then that is an extra \$472 per year, or \$0.039/kwh. If
> insured at replacement cost, it will be correspondingly higher (I
> suspect you will be required by your insurance company to cover at
> replacement cost since that is what they are promising to do for you,
> and no federal subsidy will help them replace your system after a
> fire, hurricane, etc.). If rates are lower in your area, or you don't
> carry flood coverage, then rates would be somewhat lower.
>
>
> With the cost of financing and the cost of insurance factored in, the
> cost would be approximately \$0.27/kwh for a 10 kW system. Whereas
> \$0.128/kwh is similar to current REP rates, \$0.27/kwh is not.
>
> Robert Johnston
>
> *From:* hreg@yahoogroups.com
[mailto:hreg@yahoogroups.com] *On Behalf
> Of *Chris Boyer
> *Sent:* Saturday, August 01, 2009 10:27 PM
> *To:* HREG
> *Subject:* [hreg] Cost of solar PV installed.
>
> Here is a simple calculation showing examples of the current economics
> for Solar PV in Houston. I mentioned this is the HREG meeting last
> Sunday, so here are the numbers. What it shows is the "Price" of
> installing a system of three sizes on a building (the upfront cash
> layout), from 100 kW, to 10 kW and 1 kW; then the Federal Tax Credit
> (which is now a rebate for commercial systems); and the Net cost of
> the solar installation for each size. The next line is typical energy
> production (kWh) that the system would produce over the life of the
> system (25 years warranty). Dividing the Net cost by energy produced
> gives the Cost of electricity with a solar PV system on a building:
> less than 12 cents/kWh for larger systems and nearly 15 cents/kWh for
> very small systems.
>
> Size
>
>
>
> 100 kW
>
>
>
> 10 kW
>
>
>
> 1 kW
>
> Price
>
>
>
> \$500,000.00
>
>
>
> \$55,000.00
>
>
>
> \$6,500.00
>
> Fed
>
>
>
> \$150,000.00
>
>
>
> \$16,500.00
>
>
>
> \$1,950.00
>
> Net
>
>
>
> \$350,000.00
>
>
>
> \$38,500.00
>
>
>
> \$4,550.00
>
> Production
>
>
>
>
>
> kWh/25yr
>
>
>
> 3,000,000
>
>
>
> 300,000
>
>
>
> 30,000
>
> Electricity
>
>
>
>
>
> Cost
>
>
>
> \$ 0.117
>
>
>
> \$ 0.128
>
>
>
> \$ 0.152
>
>
>
>

------------------------------------

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Checked by AVG - www.avg.com
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05:56:00

• Oops.typo. The forecast from DOE is to 2030, not 2300! Robert From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of Robert Johnston Sent:
Message 8 of 29 , Aug 2, 2009

Oops…typo.  The forecast from DOE is to 2030, not 2300!

Robert

From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of Robert Johnston
Sent: Sunday, August 02, 2009 5:34 PM
To: hreg@yahoogroups.com
Subject: RE: [hreg] Cost of solar PV installed.

Kim, you've raised some interesting points. I'll try to address each below.

Assuming 100% financing at mortgage rates in the cost of capital calculation
is reasonable. Actually, it is conservative, since most people probably
couldn't finance at mortgage rates (i.e., they would have a higher interest
rate for a home improvement loan or whatever). If you only finance 90% (or
whatever), you still have a cost of capital associated with the remaining
10% that you had to pay out of pocket. That is capital not available to you
for some other purpose, such as paying down a different loan, or investing,
etc. So doing the calculation on the basis of 100% financing is the correct
approach for comparisons of this type, even if not the level of financing a
particular individual would choose to use (or be allowed by her bank).

As for the term, adjust it however you like. I used 25 years simply because
that is the estimated life of the product as used in Chris' calculations, so
I kept things on that basis. If you finance for less time, you pay less
interest, but you also have more capital tied up for longer. If you figured
the value of that (lost opportunity cost), I think it would work out to be
about the same as simply amortizing over 25 years as I did. In other words,
is if you think there is a greater return on capital for the money invested
in the solar system than in other investments. But that doesn't change the
fact that for a fair "apples vs. apples comparison" of costs one should
amortize over the life of the system.

You suggested an adjustment for the rising cost of electricity. The
forecasted increase is not that great if you factor in inflation. DOE
forecasts only 0.6%/yr increase in residential energy rates from 2007-2300.
for AEO under the U.S. Data Projections for Electricity). In short, rising
from 10.6 to 12.2 cents/kwh in 2007 dollars. Obviously, that only makes a
small dent in the difference between current REP rates and the cost of
PV-generated electricity under the assumptions used below. That small
increase may be offset on the PV side by the expected increase in insurance
costs over the life of the system.

You also suggested including "final value" or residual value estimate. I
did not because Chris did not. If the useful lifetime is 25 years, then the
estimates are accurate. If the useful life is longer, then both Chris' and
my estimates are too high and the actual cost of solar will prove less.
(But how much value there will be in a system in 25 years, I question. I
know very few technology devices that are desirable after 25 years! The
original homeowner will probably have moved on, and the buyer of a home in
25 years will prefer the technology available at that time, which will no
doubt be much improved, given the advances in technology. For example, what
if there is a new control scheme required to be installed to tie into a
nation-wide smart grid, or what if they want new battery technology for
storage, etc.? Does anyone know of many PV systems installed in the 1980
timeframe that are going strong today without significant interim
improvements/repairs?).

Your "pay the grid" argument is correct. That is why to do a fair
comparison, one should factor in cost of capital, since the grid has no
"upfront" capital cost to the homeowner. In reality, there **IS** a cost of
capital for electricity generation and distribution systems on the grid;
these are amortized and the homeowner pays for them over time in their
rates. So, to compare PV without cost of capital to the "grid" with cost of
capital is an inaccurate and misleading comparison.

Actually, owning a home can often be more expensive than renting. It is a
longstanding myth in America that homeownership is less expensive. In some
circumstances it is, in others not. Depends in part on the part of the
certainly is not without its risks, as homeowners in much of the nation
(thankfully not much in Texas--this time!) are learning. An interesting
blog on this topic can be found here:

That blog, in fact, is a good segue to make the point that, just as buying a
house vs. renting has certain nontangible benefits that people enjoy, so
owning a PV system brings certain nontangible benefits to people that some
people enjoy. In neither case, however, should one confuse these
nontangibles with the actual value or cost of a particular choice.
Regardless of whether we tweak the calculations a bit in the above areas or
not, I think that when one does the comparisons on a fair basis, taking into
account the cost of capital, etc., PV is on the order of 2.5 times the cost
of the "grid" (where one can also choose 100% renewable if one wishes to).
Incidentally, if one is trying to hedge against rising inflation or rising
energy costs, one can do that through any number of financial
instruments/investments that will likely provide higher returns, lower risk,
less maintenance, etc., than a PV system will entail.

I suspect some people wish I'd quit criticizing optimistic PV cost figures
that get posted here from time to time. I am not anti-PV! I just think we
should be honest with one another and accurately portray the true costs,
then let people make the decision that is best for them, factoring in
accurate financial costs as well as the intangibles. Raising false
expectations is not healthy for any industry, and I don't think the PV
industry is well-served by boosterism that inaccurately projects its costs.
(BTW, please note that I am NOT accusing Chris of boosterism! I don't know
the context of his calculations, and know him only as an enthusiastic
supporter and helpful user of renewable energy technologies. There's
nothing wrong with that--it is why this group exists!). For me personally,
PV should be a trouble-free system with costs equal to renewable energy
purchased on the grid with the full support of professional
crews/maintenance included. When that day comes, and I can make a sound
risk-adjusted return on my investment, I'll be interested. Until then, it
is a hobby/interest which I enjoy learning more about, including from people
like Chris with skin in the game.

Robert Johnston

-----Original Message-----
From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of Garth
& Kim Travis
Sent: Sunday, August 02, 2009 3:40 PM
To: hreg@yahoogroups.com
Subject: Re: [hreg] Cost of solar PV installed.

Greetings,

Why would you factor 100% financing? Even mortgages require at least 5
or 10 percent down. Also, a 25 year term for a mere \$38,500? That is
paying less than \$2,000 a year in capital. Any financial adviser worth
their salt would tell you that is a bit silly, a 15 year period would be
pretty maximum. How many times over do you wish to pay for the system?

If you are going to include all of the joys of ownership, you should
also include the adjustments for the rising cost of electric, and the
final value of the system when it is paid for. Especially since when you
pay the grid, at the end of it all, you have nothing. It is like renting
a home vs owning a home. Initially it costs more to own, but in the long
run, it is soooooo much cheaper.

Bright Blessings,
Kim

Robert Johnston wrote:

>
>
> This doesn't factor in (1) the cost of capital or (2) increased
> property insurance rates.
>
> (1) If you assume 100% financing at mortgage rates of 5.25% for 25
> years, the monthly payment for a \$38,500 system (10kW) would be
> \$230.71. Using Chris' estimated output for a 10kW system of 1000
> kW/mo, that increases the cost to \$0.23/kwh.
>
> (2) I was recently quoted \$10 annually per \$1000 coverage on Texas
> Windstorm (possibly Houston is a bit less; I live in Lake Jackson,
> nearer the coast). Federal flood insurance currently runs me \$2.61 per
> \$1000 coverage. Homeowners insurance costs me \$3.73 per \$1000 of
> coverage. Thus, for all 3 coverages, a total of \$16.34 per \$1000 of
> coverage. Now, I don't know what exactly solar panels and controls add
> compared to the cost of the rest of the house itself, but if we
> conservatively assume that it incrementally increases insurance costs
> only at 75% of the rate of the rest of the house, that is \$12.26 per
> \$1000, or for a \$38,500 installation (assuming we only insure for the
> net cost to us after federal subsidies, not the replacement cost of
> the system), then that is an extra \$472 per year, or \$0.039/kwh. If
> insured at replacement cost, it will be correspondingly higher (I
> suspect you will be required by your insurance company to cover at
> replacement cost since that is what they are promising to do for you,
> and no federal subsidy will help them replace your system after a
> fire, hurricane, etc.). If rates are lower in your area, or you don't
> carry flood coverage, then rates would be somewhat lower.
>
>
> With the cost of financing and the cost of insurance factored in, the
> cost would be approximately \$0.27/kwh for a 10 kW system. Whereas
> \$0.128/kwh is similar to current REP rates, \$0.27/kwh is not.
>
> Robert Johnston
>
> *From:* hreg@yahoogroups.com
[mailto:hreg@yahoogroups.com] *On Behalf
> Of *Chris Boyer
> *Sent:* Saturday, August 01, 2009 10:27 PM
> *To:* HREG
> *Subject:* [hreg] Cost of solar PV installed.
>
> Here is a simple calculation showing examples of the current economics
> for Solar PV in Houston. I mentioned this is the HREG meeting last
> Sunday, so here are the numbers. What it shows is the "Price" of
> installing a system of three sizes on a building (the upfront cash
> layout), from 100 kW, to 10 kW and 1 kW; then the Federal Tax Credit
> (which is now a rebate for commercial systems); and the Net cost of
> the solar installation for each size. The next line is typical energy
> production (kWh) that the system would produce over the life of the
> system (25 years warranty). Dividing the Net cost by energy produced
> gives the Cost of electricity with a solar PV system on a building:
> less than 12 cents/kWh for larger systems and nearly 15 cents/kWh for
> very small systems.
>
> Size
>
>
>
> 100 kW
>
>
>
> 10 kW
>
>
>
> 1 kW
>
> Price
>
>
>
> \$500,000.00
>
>
>
> \$55,000.00
>
>
>
> \$6,500.00
>
> Fed
>
>
>
> \$150,000.00
>
>
>
> \$16,500.00
>
>
>
> \$1,950.00
>
> Net
>
>
>
> \$350,000.00
>
>
>
> \$38,500.00
>
>
>
> \$4,550.00
>
> Production
>
>
>
>
>
> kWh/25yr
>
>
>
> 3,000,000
>
>
>
> 300,000
>
>
>
> 30,000
>
> Electricity
>
>
>
>
>
> Cost
>
>
>
> \$ 0.117
>
>
>
> \$ 0.128
>
>
>
> \$ 0.152
>
>
>
>

------------------------------------

• Yes, I can t argue against a realistic financial perspective, but I also think that distorts the true value of the investment. We seldom apply those rules to
Message 9 of 29 , Aug 2, 2009
Yes, I can't argue against a realistic financial perspective, but I also think that distorts the true value of the investment.  We seldom apply those rules to most of the other major purchases in our lives.

We never think about the return on a set of golf clubs, a beautiful home, a sleek car or a granite countertop, but those investments make for a more fulfilling life, and we personally justify the extra expense by the satisfaction and enjoyment we get from using those items. How many people reading this bought their car because it was the cheapest and most economical one you could find?  It more likely came down to personal choice and preference.

If climate change, dwindling resources, environmental degradation, threatened wildlife, future generations, a sustainable society and lifestyle or any other issues are close to your heart, then you can make the right decision without regard for ROI, payback, cost of opportunity, etc...and feel real good about it.

How many people use life cycle costing when buying a big screen TV, a stainless steel refrigerator, BBQ grill or new furniture?  Then why do we always insist on imposing those rules on solar?

If we only made decisions based on economics, this would be one empty, desolate planet....and we would do many things for the very wrong reasons.

Value is so much more than just cost.....and I admire the people who make the right decisions for the "wrong" reasons.

Kevin Conlin
Heliosolar Design, Inc.
13534 Quetzal Lane
Houston, TX 77083
C:  (281) 202-9629
H:  (281) 530-7501
F:  (281) 530-7501

From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of Robert Johnston
Sent: Sunday, August 02, 2009 5:40 PM
To: hreg@yahoogroups.com
Subject: RE: [hreg] A different way to look at PV investment...

I see you posted while I was composing my last post.  Just a quick comment…

Your last paragraph is the key one—for some people, the intangibles make it worth it.  That’s fine, so long as the true financial cost isn’t obscured.  Using the example of an electric vehicle just creates a mental image of something green and neat—free transportation fuel!  But from a financial perspective, one would want to do the comparison on the basis of the cost of metered electricity from the grid vs. the cost of electricity from PV—regardless of whether it is used for an electric car or for anything else you wanted it for.  In that case, the calculation must still factor in cost of capital etc. as I argued.  i.e., regardless of the use, one should just make the calculation on the basis of cost per kwh.

Robert

From: hreg@yahoogroups. com [mailto:hreg@ yahoogroups. com] On Behalf Of Kevin Conlin
Sent: Sunday, August 02, 2009 5:13 PM
To: hreg@yahoogroups. com
Subject: [hreg] A different way to look at PV investment.. .

Good points all.

At the Solar 2009 conference a few months ago I heard a very interesting
analogy made. The premise was that if you invested in a 1.5 kw PV system and
drove an electric vehicle for the next 30 years, you would essentially have
paid for 30 years worth of fuel with the PV system. I don't remember all the
specific assumptions, but it assumed a useful life of 30 years for the pv.

1.5KW @ \$10,000 x .7 Federal Tax Credit = \$7,000/30 years = \$233/year.
Compared to a 25 mpg vehicle, current gasoline costs would be at least
\$800/year, and aren't likely to decline over 30 years time, but you could
also assume mileage improvements would be par with rising fuel costs.

I know you can take the example apart because of the assumptions and
simplified math, but the point was by investing in pv/ev you were displacing
foreign oil payments and reducing the trade deficit, spending the money
domestically and stimulating a growing industry, reducing CO2 and other
climate changing emissions, encouraging distributed energy on the grid as
well as saving money personally, over \$15,000.

As Kim alluded, the benefits aren't just financial; intangibles such as the
personal pride, enjoyment and fulfillment that come from ownership have
different values to different people.

Kevin Conlin
Heliosolar Design, Inc.
13534 Quetzal Lane
Houston, TX 77083
C: (281) 202-9629
H: (281) 530-7501
F: (281) 530-7501
kevin@heliosolardes ign.com

-----Original Message-----
From: hreg@yahoogroups. com [mailto:hreg@yahoogroups. com] On Behalf Of Garth
& Kim Travis
Sent: Sunday, August 02, 2009 3:40 PM
To: hreg@yahoogroups. com
Subject: Re: [hreg] Cost of solar PV installed.

Greetings,

Why would you factor 100% financing? Even mortgages require at least 5 or 10
percent down. Also, a 25 year term for a mere \$38,500? That is paying less
than \$2,000 a year in capital. Any financial adviser worth their salt would
tell you that is a bit silly, a 15 year period would be pretty maximum. How
many times over do you wish to pay for the system?

If you are going to include all of the joys of ownership, you should also
include the adjustments for the rising cost of electric, and the final value
of the system when it is paid for. Especially since when you pay the grid,
at the end of it all, you have nothing. It is like renting a home vs owning
a home. Initially it costs more to own, but in the long run, it is soooooo
much cheaper.

Bright Blessings,
Kim

Robert Johnston wrote:

>
>
> This
doesn't factor in (1) the cost of capital or (2) increased
> property
insurance rates.
>
> (1) If you assume 100% financing at mortgage
rates of 5.25% for 25
> years, the monthly payment for a \$38,500 system
(10kW) would be
> \$230.71. Using Chris' estimated output for a 10kW
system of 1000
> kW/mo, that increases the cost to
\$0.23/kwh.
>
> (2) I was recently quoted \$10 annually per \$1000
coverage on Texas
> Windstorm (possibly Houston is a bit less; I live in
Lake Jackson,
> nearer the coast). Federal flood insurance currently runs
me \$2.61 per
> \$1000 coverage. Homeowners insurance costs me \$3.73 per
\$1000 of
> coverage. Thus, for all 3 coverages, a total of \$16.34 per
\$1000 of
> coverage. Now, I don't know what exactly solar panels and
> compared to the cost of the rest of the house itself, but
if we
> conservatively assume that it incrementally increases insurance
costs
> only at 75% of the rate of the rest of the house, that is \$12.26
per
> \$1000, or for a \$38,500 installation (assuming we only insure for
the
> net cost to us after federal subsidies, not the replacement cost of
> the system), then that is an extra \$472 per year, or \$0.039/kwh. If
> insured at replacement cost, it will be correspondingly higher (I
> suspect you will be required by your insurance company to cover at
> replacement cost since that is what they are promising to do for you,
> and no federal subsidy will help them replace your system after a
> fire, hurricane, etc.). If rates are lower in your area, or you don't
> carry flood coverage, then rates would be somewhat
lower.
>
>
> With the cost of financing and the cost of
insurance factored in, the
> cost would be approximately \$0.27/kwh for a
10 kW system. Whereas
> \$0.128/kwh is similar to current REP rates,
\$0.27/kwh is not.
>
> Robert Johnston
>
> *From:*
href="mailto:hreg%40yahoogroups.com">hreg@yahoogroups. com [mailto:hreg@yahoogroups. com] *On Behalf
> Of *Chris Boyer
> *Sent:* Saturday, August 01, 2009 10:27
PM
> *To:* HREG
> *Subject:* [hreg] Cost of solar PV
installed.
>
> Here is a simple calculation showing examples of the
current economics
> for Solar PV in Houston. I mentioned this is the HREG
meeting last
> Sunday, so here are the numbers. What it shows is the
"Price" of
> installing a system of three sizes on a building (the
upfront cash
> layout), from 100 kW, to 10 kW and 1 kW; then the Federal
Tax Credit
> (which is now a rebate for commercial systems); and the Net
cost of
> the solar installation for each size. The next line is typical
energy
> production (kWh) that the system would produce over the life of
the
> system (25 years warranty). Dividing the Net cost by energy
produced
> gives the Cost of electricity with a solar PV system on a
building:
> less than 12 cents/kWh for larger systems and nearly 15
cents/kWh for
> very small systems.
>
> Size
>
>
>
> 100 kW
>
>
>
> 10 kW
>
>
>
> 1 kW
>
> Price
>
>
>
>
\$500,000.00
>
>
>
> \$55,000.00
>
>
>
> \$6,500.00
>
> Fed
>
>
>
>
\$150,000.00
>
>
>
> \$16,500.00
>
>
>
> \$1,950.00
>
> Net
>
>
>
>
\$350,000.00
>
>
>
> \$38,500.00
>
>
>
> \$4,550.00
>
> Production
>
>
>
>
>
> kWh/25yr
>
>
>
>
3,000,000
>
>
>
> 300,000
>
>
>
> 30,000
>
> Electricity
>
>
>
>
>
> Cost
>
>
>
> \$
0.117
>
>
>
> \$ 0.128
>
>
>
>
\$ 0.152
>
>
>
>

------------ --------- --------- ------

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• Yes, but you are pointing to the intangibles. How many people purchase PV because it is fun or sexy or anything like that? A few enthusiasts do. But most
Message 10 of 29 , Aug 2, 2009

Yes, but you are pointing to the intangibles.  How many people purchase PV because it is fun or sexy or anything like that?  A few enthusiasts do.  But most people are interested simply in getting electrical power; they don’t care how.  As for the environment, climate change, etc.—remember that this is all available “on the grid” through renewable sources (windpower etc.).  So it isn’t a choice between PV and climate change etc.  The question is whether distributed power in the form of residential PV is cost competitive with renewable power distributed over the grid.  The answer, I believe the analysis shows (if you factor in cost of capital), is “no”.  Again, that doesn’t mean folks who get a thrill watching electrons chase holes in their PV panels won’t enjoy having them.

Robert

From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of Kevin Conlin
Sent: Sunday, August 02, 2009 7:12 PM
To: hreg@yahoogroups.com
Subject: [hreg] A different way to look at PV investment... cost vs. value

Yes, I can't argue against a realistic financial perspective, but I also think that distorts the true value of the investment.  We seldom apply those rules to most of the other major purchases in our lives.

We never think about the return on a set of golf clubs, a beautiful home, a sleek car or a granite countertop, but those investments make for a more fulfilling life, and we personally justify the extra expense by the satisfaction and enjoyment we get from using those items. How many people reading this bought their car because it was the cheapest and most economical one you could find?  It more likely came down to personal choice and preference.

If climate change, dwindling resources, environmental degradation, threatened wildlife, future generations, a sustainable society and lifestyle or any other issues are close to your heart, then you can make the right decision without regard for ROI, payback, cost of opportunity, etc...and feel real good about it.

How many people use life cycle costing when buying a big screen TV, a stainless steel refrigerator, BBQ grill or new furniture?  Then why do we always insist on imposing those rules on solar?

If we only made decisions based on economics, this would be one empty, desolate planet....and we would do many things for the very wrong reasons.

Value is so much more than just cost.....and I admire the people who make the right decisions for the "wrong" reasons.

Kevin Conlin

Heliosolar Design, Inc.

13534 Quetzal Lane

Houston, TX 77083

C:  (281) 202-9629

H:  (281) 530-7501

F:  (281) 530-7501

kevin@...

From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of Robert Johnston
Sent: Sunday, August 02, 2009 5:40 PM
To: hreg@yahoogroups.com
Subject: RE: [hreg] A different way to look at PV investment...

I see you posted while I was composing my last post.  Just a quick comment…

Your last paragraph is the key one—for some people, the intangibles make it worth it.  That’s fine, so long as the true financial cost isn’t obscured.  Using the example of an electric vehicle just creates a mental image of something green and neat—free transportation fuel!  But from a financial perspective, one would want to do the comparison on the basis of the cost of metered electricity from the grid vs. the cost of electricity from PV—regardless of whether it is used for an electric car or for anything else you wanted it for.  In that case, the calculation must still factor in cost of capital etc. as I argued.  i.e., regardless of the use, one should just make the calculation on the basis of cost per kwh.

Robert

From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of Kevin Conlin
Sent: Sunday, August 02, 2009 5:13 PM
To: hreg@yahoogroups.com
Subject: [hreg] A different way to look at PV investment...

Good points all.

At the Solar 2009 conference a few months ago I heard a very interesting
analogy made. The premise was that if you invested in a 1.5 kw PV system and
drove an electric vehicle for the next 30 years, you would essentially have
paid for 30 years worth of fuel with the PV system. I don't remember all the
specific assumptions, but it assumed a useful life of 30 years for the pv.

1.5KW @ \$10,000 x .7 Federal Tax Credit = \$7,000/30 years = \$233/year.
Compared to a 25 mpg vehicle, current gasoline costs would be at least
\$800/year, and aren't likely to decline over 30 years time, but you could
also assume mileage improvements would be par with rising fuel costs.

I know you can take the example apart because of the assumptions and
simplified math, but the point was by investing in pv/ev you were displacing
foreign oil payments and reducing the trade deficit, spending the money
domestically and stimulating a growing industry, reducing CO2 and other
climate changing emissions, encouraging distributed energy on the grid as
well as saving money personally, over \$15,000.

As Kim alluded, the benefits aren't just financial; intangibles such as the
personal pride, enjoyment and fulfillment that come from ownership have
different values to different people.

Kevin Conlin
Heliosolar Design, Inc.
13534 Quetzal Lane
Houston, TX 77083
C: (281) 202-9629
H: (281) 530-7501
F: (281) 530-7501
kevin@...

-----Original Message-----
From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of Garth
& Kim Travis
Sent: Sunday, August 02, 2009 3:40 PM
To: hreg@yahoogroups.com
Subject: Re: [hreg] Cost of solar PV installed.

Greetings,

Why would you factor 100% financing? Even mortgages require at least 5 or 10
percent down. Also, a 25 year term for a mere \$38,500? That is paying less
than \$2,000 a year in capital. Any financial adviser worth their salt would
tell you that is a bit silly, a 15 year period would be pretty maximum. How
many times over do you wish to pay for the system?

If you are going to include all of the joys of ownership, you should also
include the adjustments for the rising cost of electric, and the final value
of the system when it is paid for. Especially since when you pay the grid,
at the end of it all, you have nothing. It is like renting a home vs owning
a home. Initially it costs more to own, but in the long run, it is soooooo
much cheaper.

Bright Blessings,
Kim

Robert Johnston wrote:

>
>
> This doesn't factor in (1) the cost of capital or (2) increased
> property insurance rates.
>
> (1) If you assume 100% financing at mortgage rates of 5.25% for 25
> years, the monthly payment for a \$38,500 system (10kW) would be
> \$230.71. Using Chris' estimated output for a 10kW system of 1000
> kW/mo, that increases the cost to \$0.23/kwh.
>
> (2) I was recently quoted \$10 annually per \$1000 coverage on Texas
> Windstorm (possibly Houston is a bit less; I live in Lake Jackson,
> nearer the coast). Federal flood insurance currently runs me \$2.61 per
> \$1000 coverage. Homeowners insurance costs me \$3.73 per \$1000 of
> coverage. Thus, for all 3 coverages, a total of \$16.34 per \$1000 of
> coverage. Now, I don't know what exactly solar panels and controls add
> compared to the cost of the rest of the house itself, but if we
> conservatively assume that it incrementally increases insurance costs
> only at 75% of the rate of the rest of the house, that is \$12.26 per
> \$1000, or for a \$38,500 installation (assuming we only insure for the
> net cost to us after federal subsidies, not the replacement cost of
> the system), then that is an extra \$472 per year, or \$0.039/kwh. If
> insured at replacement cost, it will be correspondingly higher (I
> suspect you will be required by your insurance company to cover at
> replacement cost since that is what they are promising to do for you,
> and no federal subsidy will help them replace your system after a
> fire, hurricane, etc.). If rates are lower in your area, or you don't
> carry flood coverage, then rates would be somewhat lower.
>
>
> With the cost of financing and the cost of insurance factored in, the
> cost would be approximately \$0.27/kwh for a 10 kW system. Whereas
> \$0.128/kwh is similar to current REP rates, \$0.27/kwh is not.
>
> Robert Johnston
>
> *From:* hreg@yahoogroups.com
[mailto:hreg@yahoogroups.com] *On Behalf
> Of *Chris Boyer
> *Sent:* Saturday, August 01, 2009 10:27 PM
> *To:* HREG
> *Subject:* [hreg] Cost of solar PV installed.
>
> Here is a simple calculation showing examples of the current economics
> for Solar PV in Houston. I mentioned this is the HREG meeting last
> Sunday, so here are the numbers. What it shows is the "Price" of
> installing a system of three sizes on a building (the upfront cash
> layout), from 100 kW, to 10 kW and 1 kW; then the Federal Tax Credit
> (which is now a rebate for commercial systems); and the Net cost of
> the solar installation for each size. The next line is typical energy
> production (kWh) that the system would produce over the life of the
> system (25 years warranty). Dividing the Net cost by energy produced
> gives the Cost of electricity with a solar PV system on a building:
> less than 12 cents/kWh for larger systems and nearly 15 cents/kWh for
> very small systems.
>
> Size
>
>
>
> 100 kW
>
>
>
> 10 kW
>
>
>
> 1 kW
>
> Price
>
>
>
> \$500,000.00
>
>
>
> \$55,000.00
>
>
>
> \$6,500.00
>
> Fed
>
>
>
> \$150,000.00
>
>
>
> \$16,500.00
>
>
>
> \$1,950.00
>
> Net
>
>
>
> \$350,000.00
>
>
>
> \$38,500.00
>
>
>
> \$4,550.00
>
> Production
>
>
>
>
>
> kWh/25yr
>
>
>
> 3,000,000
>
>
>
> 300,000
>
>
>
> 30,000
>
> Electricity
>
>
>
>
>
> Cost
>
>
>
> \$ 0.117
>
>
>
> \$ 0.128
>
>
>
> \$ 0.152
>
>
>
>

------------------------------------

No virus found in this incoming message.
Checked by AVG - www.avg.com
Version: 8.5.392 / Virus Database: 270.13.41/2277 - Release Date: 08/02/09
05:56:00

No virus found in this incoming message.
Checked by AVG - www.avg.com
Version: 8.5.392 / Virus Database: 270.13.41/2277 - Release Date: 08/02/09 05:56:00

• There are a few things that are not being considered. The US Government has to borrow the money to give the owner of a PV system the tax credit. Based on past
Message 11 of 29 , Aug 2, 2009
There are a few things that are not being considered. The US Government has to borrow the money to give the owner of a PV system the tax credit. Based on past history, the government will borrow this money forever. The government will be paying interest on this money long after the PV system is gone.If a large number of people installed a PV system where would the government get the money to pay the tax credit? The cost of a back up system to supply electricity when the sun is not shining. The local utility is required to supply electricity when ever needed, so they would have to build generating plants to cover the demand when the sun was not shining. What source of power would they use to generate electricity? Coal or nuclear? Having the extra capacity that was little used would substantially increase the cost of electricity from the utility. Guess who would pay for that. The tax credit would mostly go to higher income people as poor people would not have enough income to use the tax credit. What that does is take money from poor people and give it to rich people. The poor would have to pay those higher rates. It is more expensive to install PV on each house than to install a Solar Power Tower central system. I was told that a PV system costs about \$8 per watt to install. A central system costs about \$1.00 per watt. If Rice University gets there nano tech wire perfected it would eliminate enough line loss to enable us to shut down 30% of our present generating capacity. I believe that when we get to mass producing Solar Power Tower electric generating plants, the cost will come down enough that it will be the cheapest form of generation. Presently, a SPT plant costs 1/2 as much to build as a nuclear plant-has no fuel cost and is much cheaper to operate.
Otto Glaser
12111 Medina Bend Lane
Houston, TX 77041-6694
Phone and Fax 713-896-9935
Email oglaser@...
----- Original Message -----
Sent: Sunday, August 02, 2009 7:43 PM
Subject: RE: [hreg] A different way to look at PV investment... cost vs. value

Yes, but you are pointing to the intangibles.  How many people purchase PV because it is fun or sexy or anything like that?  A few enthusiasts do.  But most people are interested simply in getting electrical power; they dont care how.  As for the environment, climate change, etc.remember that this is all available on the grid through renewable sources (windpower etc.).  So it isnt a choice between PV and climate change etc.  The question is whether distributed power in the form of residential PV is cost competitive with renewable power distributed over the grid.  The answer, I believe the analysis shows (if you factor in cost of capital), is no.  Again, that doesnt mean folks who get a thrill watching electrons chase holes in their PV panels wont enjoy having them.

Robert

From: hreg@yahoogroups. com [mailto:hreg@ yahoogroups. com] On Behalf Of Kevin Conlin
Sent: Sunday, August 02, 2009 7:12 PM
To: hreg@yahoogroups. com
Subject: [hreg] A different way to look at PV investment.. . cost vs. value

Yes, I can't argue against a realistic financial perspective, but I also think that distorts the true value of the investment.  We seldom apply those rules to most of the other major purchases in our lives.

We never think about the return on a set of golf clubs, a beautiful home, a sleek car or a granite countertop, but those investments make for a more fulfilling life, and we personally justify the extra expense by the satisfaction and enjoyment we get from using those items. How many people reading this bought their car because it was the cheapest and most economical one you could find?  It more likely came down to personal choice and preference.

If climate change, dwindling resources, environmental degradation, threatened wildlife, future generations, a sustainable society and lifestyle or any other issues are close to your heart, then you can make the right decision without regard for ROI, payback, cost of opportunity, etc...and feel real good about it.

How many people use life cycle costing when buying a big screen TV, a stainless steel refrigerator, BBQ grill or new furniture?  Then why do we always insist on imposing those rules on solar?

If we only made decisions based on economics, this would be one empty, desolate planet....and we would do many things for the very wrong reasons.

Value is so much more than just cost.....and I admire the people who make the right decisions for the "wrong" reasons.

Kevin Conlin

Heliosolar Design, Inc.

13534 Quetzal Lane

Houston, TX 77083

C:  (281) 202-9629

H:  (281) 530-7501

F:  (281) 530-7501

kevin@heliosolardes ign.com

From: hreg@yahoogroups. com [mailto:hreg@ yahoogroups. com] On Behalf Of Robert Johnston
Sent: Sunday, August 02, 2009 5:40 PM
To: hreg@yahoogroups. com
Subject: RE: [hreg] A different way to look at PV investment.. .

I see you posted while I was composing my last post.  Just a quick comment

Your last paragraph is the key onefor some people, the intangibles make it worth it.  Thats fine, so long as the true financial cost isnt obscured.  Using the example of an electric vehicle just creates a mental image of something green and neatfree transportation fuel!  But from a financial perspective, one would want to do the comparison on the basis of the cost of metered electricity from the grid vs. the cost of electricity from PVregardless of whether it is used for an electric car or for anything else you wanted it for.  In that case, the calculation must still factor in cost of capital etc. as I argued.  i.e., regardless of the use, one should just make the calculation on the basis of cost per kwh.

Robert

From: hreg@yahoogroups. com [mailto:hreg@ yahoogroups. com] On Behalf Of Kevin Conlin
Sent: Sunday, August 02, 2009 5:13 PM
To: hreg@yahoogroups. com
Subject: [hreg] A different way to look at PV investment.. .

Good points all.

At the Solar 2009 conference a few months ago I heard a very interesting
analogy made. The premise was that if you invested in a 1.5 kw PV system and
drove an electric vehicle for the next 30 years, you would essentially have
paid for 30 years worth of fuel with the PV system. I don't remember all the
specific assumptions, but it assumed a useful life of 30 years for the pv.

1.5KW @ \$10,000 x .7 Federal Tax Credit = \$7,000/30 years = \$233/year.
Compared to a 25 mpg vehicle, current gasoline costs would be at least
\$800/year, and aren't likely to decline over 30 years time, but you could
also assume mileage improvements would be par with rising fuel costs.

I know you can take the example apart because of the assumptions and
simplified math, but the point was by investing in pv/ev you were displacing
foreign oil payments and reducing the trade deficit, spending the money
domestically and stimulating a growing industry, reducing CO2 and other
climate changing emissions, encouraging distributed energy on the grid as
well as saving money personally, over \$15,000.

As Kim alluded, the benefits aren't just financial; intangibles such as the
personal pride, enjoyment and fulfillment that come from ownership have
different values to different people.

Kevin Conlin
Heliosolar Design, Inc.
13534 Quetzal Lane
Houston, TX 77083
C: (281) 202-9629
H: (281) 530-7501
F: (281) 530-7501
kevin@heliosolardes ign.com

-----Original Message-----
From: hreg@yahoogroups. com [mailto:hreg@yahoogroups. com] On Behalf Of Garth
& Kim Travis
Sent: Sunday, August 02, 2009 3:40 PM
To: hreg@yahoogroups. com
Subject: Re: [hreg] Cost of solar PV installed.

Greetings,

Why would you factor 100% financing? Even mortgages require at least 5 or 10
percent down. Also, a 25 year term for a mere \$38,500? That is paying less
than \$2,000 a year in capital. Any financial adviser worth their salt would
tell you that is a bit silly, a 15 year period would be pretty maximum. How
many times over do you wish to pay for the system?

If you are going to include all of the joys of ownership, you should also
include the adjustments for the rising cost of electric, and the final value
of the system when it is paid for. Especially since when you pay the grid,
at the end of it all, you have nothing. It is like renting a home vs owning
a home. Initially it costs more to own, but in the long run, it is soooooo
much cheaper.

Bright Blessings,
Kim

Robert Johnston wrote:
>
>
> This doesn't factor in (1) the cost of capital or (2) increased
> property insurance rates.
>
> (1) If you assume 100% financing at mortgage rates of 5.25% for 25
> years, the monthly payment for a \$38,500 system (10kW) would be
> \$230.71. Using Chris' estimated output for a 10kW system of 1000
> kW/mo, that increases the cost to \$0.23/kwh.
>
> (2) I was recently quoted \$10 annually per \$1000 coverage on Texas
> Windstorm (possibly Houston is a bit less; I live in Lake Jackson,
> nearer the coast). Federal flood insurance currently runs me \$2.61 per
> \$1000 coverage. Homeowners insurance costs me \$3.73 per \$1000 of
> coverage. Thus, for all 3 coverages, a total of \$16.34 per \$1000 of
> coverage. Now, I don't know what exactly solar panels and controls add
> compared to the cost of the rest of the house itself, but if we
> conservatively assume that it incrementally increases insurance costs
> only at 75% of the rate of the rest of the house, that is \$12.26 per
> \$1000, or for a \$38,500 installation (assuming we only insure for the
> net cost to us after federal subsidies, not the replacement cost of
> the system), then that is an extra \$472 per year, or \$0.039/kwh. If
> insured at replacement cost, it will be correspondingly higher (I
> suspect you will be required by your insurance company to cover at
> replacement cost since that is what they are promising to do for you,
> and no federal subsidy will help them replace your system after a
> fire, hurricane, etc.). If rates are lower in your area, or you don't
> carry flood coverage, then rates would be somewhat lower.
>
>
> With the cost of financing and the cost of insurance factored in, the
> cost would be approximately \$0.27/kwh for a 10 kW system. Whereas
> \$0.128/kwh is similar to current REP rates, \$0.27/kwh is not.
>
> Robert Johnston
>
> *From:* hreg@yahoogroups. com [mailto:hreg@yahoogroups. com] *On Behalf
> Of *Chris Boyer
> *Sent:* Saturday, August 01, 2009 10:27 PM
> *To:* HREG
> *Subject:* [hreg] Cost of solar PV installed.
>
> Here is a simple calculation showing examples of the current economics
> for Solar PV in Houston. I mentioned this is the HREG meeting last
> Sunday, so here are the numbers. What it shows is the "Price" of
> installing a system of three sizes on a building (the upfront cash
> layout), from 100 kW, to 10 kW and 1 kW; then the Federal Tax Credit
> (which is now a rebate for commercial systems); and the Net cost of
> the solar installation for each size. The next line is typical energy
> production (kWh) that the system would produce over the life of the
> system (25 years warranty). Dividing the Net cost by energy produced
> gives the Cost of electricity with a solar PV system on a building:
> less than 12 cents/kWh for larger systems and nearly 15 cents/kWh for
> very small systems.
>
> Size
>
>
>
> 100 kW
>
>
>
> 10 kW
>
>
>
> 1 kW
>
> Price
>
>
>
> \$500,000.00
>
>
>
> \$55,000.00
>
>
>
> \$6,500.00
>
> Fed
>
>
>
> \$150,000.00
>
>
>
> \$16,500.00
>
>
>
> \$1,950.00
>
> Net
>
>
>
> \$350,000.00
>
>
>
> \$38,500.00
>
>
>
> \$4,550.00
>
> Production
>
>
>
>
>
> kWh/25yr
>
>
>
> 3,000,000
>
>
>
> 300,000
>
>
>
> 30,000
>
> Electricity
>
>
>
>
>
> Cost
>
>
>
> \$ 0.117
>
>
>
> \$ 0.128
>
>
>
> \$ 0.152
>
>
>
>

------------ --------- --------- ------

No virus found in this incoming message.
Checked by AVG - www.avg.com
Version: 8.5.392 / Virus Database: 270.13.41/2277 - Release Date: 08/02/09
05:56:00

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Checked by AVG - www.avg.com
Version: 8.5.392 / Virus Database: 270.13.41/2277 - Release Date: 08/02/09 05:56:00

• This topic really lit up the hreg switchboard. I m not a finance guy and like many other nuts and bolts thinkers have made many bad investments through my life
Message 12 of 29 , Aug 2, 2009

This topic really lit up the hreg switchboard.

I'm not a finance guy and like many other nuts and bolts thinkers have made many bad investments through my life - bad stock choices (didn’t by Apple in the 70s), beer hall versus the library hall in school,  boat(s), didn't bail of the market at 14000 etc.   Bad financial decisions due to lack of experience or timing or luck or all three.

A simple way to financially justify investing in solar PV panels for your house is to 'find' the money by designing smaller and super insulating in the first place. The current cost semi-custom home building is easily \$100/sf  (most at \$150/sf+) so taking your dream/retirement floor plan down a notch by just 500sf 'finds' you \$50,000 in present value \$ for solar PV.

Solar PV designed into an isolation circuit with a standby generator provides a decent level of grid independence for the 'shelter-in-place' portion of your home when the grid goes down.  Maybe the investment 'return'  would improve if we could place some valuation on that aspect, especially as we enter yet another hurricane season.

I have attached some prior presentation slides concerning this design concept. They also contain a handy shelter in place supplies listing.

Gary Beck, P.E., SECB, LEED AP

Eco-Holdings Engineering Services

4010 Blue Bonnet Blvd. Ste 114

Houston, Texas 77025

Tel: 713-377-4209  Fax: 832-201-5338

SECB certified in the Practice of Structural Engineering, a structural inspector for the Texas Residential Construction Commission SIRP program, and a listed Engineer for the Texas Department of Insurance Wind Storm program. Eco provides Engineering and Engineer's Inspection Services for Residential, Commercial, Lodging, Educational, Industrial and Government Facilities. Eco's design engineering services include AutoCAD based construction documents for permitting and building foundations, structures, storm water systems, and detention ponds; and Autodesk Revit based 3D Building Information Modeling for green building practices.

From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of Otto Glaser
Sent: Sunday, August 02, 2009 9:42 PM
To: hreg@yahoogroups.com
Subject: Re: [hreg] A different way to look at PV investment... cost vs. value

There are a few things that are not being considered. The US Government has to borrow the money to give the owner of a PV system the tax credit. Based on past history, the government will borrow this money forever. The government will be paying interest on this money long after the PV system is gone.If a large number of people installed a PV system where would the government get the money to pay the tax credit? The cost of a back up system to supply electricity when the sun is not shining. The local utility is required to supply electricity when ever needed, so they would have to build generating plants to cover the demand when the sun was not shining. What source of power would they use to generate electricity? Coal or nuclear? Having the extra capacity that was little used would substantially increase the cost of electricity from the utility. Guess who would pay for that. The tax credit would mostly go to higher income people as poor people would not have enough income to use the tax credit. What that does is take money from poor people and give it to rich people. The poor would have to pay those higher rates. It is more expensive to install PV on each house than to install a Solar Power Tower central system. I was told that a PV system costs about \$8 per watt to install. A central system costs about \$1.00 per watt. If Rice University gets there nano tech wire perfected it would eliminate enough line loss to enable us to shut down 30% of our present generating capacity. I believe that when we get to mass producing Solar Power Tower electric generating plants, the cost will come down enough that it will be the cheapest form of generation. Presently, a SPT plant costs 1/2 as much to build as a nuclear plant-has no fuel cost and is much cheaper to operate.

Otto Glaser
12111 Medina Bend Lane
Houston, TX 77041-6694
Phone and Fax 713-896-9935
Email oglaser@...

----- Original Message -----

From:

Sent: Sunday, August 02, 2009 7:43 PM

Subject: RE: [hreg] A different way to look at PV investment... cost vs. value

Yes, but you are pointing to the intangibles.  How many people purchase PV because it is fun or sexy or anything like that?  A few enthusiasts do.  But most people are interested simply in getting electrical power; they don’t care how.  As for the environment, climate change, etc.—remember that this is all available “on the grid” through renewable sources (windpower etc.).  So it isn’t a choice between PV and climate change etc.  The question is whether distributed power in the form of residential PV is cost competitive with renewable power distributed over the grid.  The answer, I believe the analysis shows (if you factor in cost of capital), is “no”.  Again, that doesn’t mean folks who get a thrill watching electrons chase holes in their PV panels won’t enjoy having them.

Robert

From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of Kevin Conlin
Sent: Sunday, August 02, 2009 7:12 PM
To: hreg@yahoogroups.com
Subject: [hreg] A different way to look at PV investment... cost vs. value

Yes, I can't argue against a realistic financial perspective, but I also think that distorts the true value of the investment.  We seldom apply those rules to most of the other major purchases in our lives.

We never think about the return on a set of golf clubs, a beautiful home, a sleek car or a granite countertop, but those investments make for a more fulfilling life, and we personally justify the extra expense by the satisfaction and enjoyment we get from using those items. How many people reading this bought their car because it was the cheapest and most economical one you could find?  It more likely came down to personal choice and preference.

If climate change, dwindling resources, environmental degradation, threatened wildlife, future generations, a sustainable society and lifestyle or any other issues are close to your heart, then you can make the right decision without regard for ROI, payback, cost of opportunity, etc...and feel real good about it.

How many people use life cycle costing when buying a big screen TV, a stainless steel refrigerator, BBQ grill or new furniture?  Then why do we always insist on imposing those rules on solar?

If we only made decisions based on economics, this would be one empty, desolate planet....and we would do many things for the very wrong reasons.

Value is so much more than just cost.....and I admire the people who make the right decisions for the "wrong" reasons.

Kevin Conlin

Heliosolar Design, Inc.

13534 Quetzal Lane

Houston, TX 77083

C:  (281) 202-9629

H:  (281) 530-7501

F:  (281) 530-7501

kevin@...

From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of Robert Johnston
Sent: Sunday, August 02, 2009 5:40 PM
To: hreg@yahoogroups.com
Subject: RE: [hreg] A different way to look at PV investment...

I see you posted while I was composing my last post.  Just a quick comment…

Your last paragraph is the key one—for some people, the intangibles make it worth it.  That’s fine, so long as the true financial cost isn’t obscured.  Using the example of an electric vehicle just creates a mental image of something green and neat—free transportation fuel!  But from a financial perspective, one would want to do the comparison on the basis of the cost of metered electricity from the grid vs. the cost of electricity from PV—regardless of whether it is used for an electric car or for anything else you wanted it for.  In that case, the calculation must still factor in cost of capital etc. as I argued.  i.e., regardless of the use, one should just make the calculation on the basis of cost per kwh.

Robert

From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of Kevin Conlin
Sent: Sunday, August 02, 2009 5:13 PM
To: hreg@yahoogroups.com
Subject: [hreg] A different way to look at PV investment...

Good points all.

At the Solar 2009 conference a few months ago I heard a very interesting
analogy made. The premise was that if you invested in a 1.5 kw PV system and
drove an electric vehicle for the next 30 years, you would essentially have
paid for 30 years worth of fuel with the PV system. I don't remember all the
specific assumptions, but it assumed a useful life of 30 years for the pv.

1.5KW @ \$10,000 x .7 Federal Tax Credit = \$7,000/30 years = \$233/year.
Compared to a 25 mpg vehicle, current gasoline costs would be at least
\$800/year, and aren't likely to decline over 30 years time, but you could
also assume mileage improvements would be par with rising fuel costs.

I know you can take the example apart because of the assumptions and
simplified math, but the point was by investing in pv/ev you were displacing
foreign oil payments and reducing the trade deficit, spending the money
domestically and stimulating a growing industry, reducing CO2 and other
climate changing emissions, encouraging distributed energy on the grid as
well as saving money personally, over \$15,000.

As Kim alluded, the benefits aren't just financial; intangibles such as the
personal pride, enjoyment and fulfillment that come from ownership have
different values to different people.

Kevin Conlin
Heliosolar Design, Inc.
13534 Quetzal Lane
Houston, TX 77083
C: (281) 202-9629
H: (281) 530-7501
F: (281) 530-7501
kevin@...

-----Original Message-----
From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of Garth
& Kim Travis
Sent: Sunday, August 02, 2009 3:40 PM
To: hreg@yahoogroups.com
Subject: Re: [hreg] Cost of solar PV installed.

Greetings,

Why would you factor 100% financing? Even mortgages require at least 5 or 10
percent down. Also, a 25 year term for a mere \$38,500? That is paying less
than \$2,000 a year in capital. Any financial adviser worth their salt would
tell you that is a bit silly, a 15 year period would be pretty maximum. How
many times over do you wish to pay for the system?

If you are going to include all of the joys of ownership, you should also
include the adjustments for the rising cost of electric, and the final value
of the system when it is paid for. Especially since when you pay the grid,
at the end of it all, you have nothing. It is like renting a home vs owning
a home. Initially it costs more to own, but in the long run, it is soooooo
much cheaper.

Bright Blessings,
Kim

Robert Johnston wrote:
>
>
> This doesn't factor in (1) the cost of capital or (2) increased
> property insurance rates.
>
> (1) If you assume 100% financing at mortgage rates of 5.25% for 25
> years, the monthly payment for a \$38,500 system (10kW) would be
> \$230.71. Using Chris' estimated output for a 10kW system of 1000
> kW/mo, that increases the cost to \$0.23/kwh.
>
> (2) I was recently quoted \$10 annually per \$1000 coverage on Texas
> Windstorm (possibly Houston is a bit less; I live in Lake Jackson,
> nearer the coast). Federal flood insurance currently runs me \$2.61 per
> \$1000 coverage. Homeowners insurance costs me \$3.73 per \$1000 of
> coverage. Thus, for all 3 coverages, a total of \$16.34 per \$1000 of
> coverage. Now, I don't know what exactly solar panels and controls add
> compared to the cost of the rest of the house itself, but if we
> conservatively assume that it incrementally increases insurance costs
> only at 75% of the rate of the rest of the house, that is \$12.26 per
> \$1000, or for a \$38,500 installation (assuming we only insure for the
> net cost to us after federal subsidies, not the replacement cost of
> the system), then that is an extra \$472 per year, or \$0.039/kwh. If
> insured at replacement cost, it will be correspondingly higher (I
> suspect you will be required by your insurance company to cover at
> replacement cost since that is what they are promising to do for you,
> and no federal subsidy will help them replace your system after a
> fire, hurricane, etc.). If rates are lower in your area, or you don't
> carry flood coverage, then rates would be somewhat lower.
>
>
> With the cost of financing and the cost of insurance factored in, the
> cost would be approximately \$0.27/kwh for a 10 kW system. Whereas
> \$0.128/kwh is similar to current REP rates, \$0.27/kwh is not.
>
> Robert Johnston
>
> *From:* hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] *On Behalf
> Of *Chris Boyer
> *Sent:* Saturday, August 01, 2009 10:27 PM
> *To:* HREG
> *Subject:* [hreg] Cost of solar PV installed.
>
> Here is a simple calculation showing examples of the current economics
> for Solar PV in Houston. I mentioned this is the HREG meeting last
> Sunday, so here are the numbers. What it shows is the "Price" of
> installing a system of three sizes on a building (the upfront cash
> layout), from 100 kW, to 10 kW and 1 kW; then the Federal Tax Credit
> (which is now a rebate for commercial systems); and the Net cost of
> the solar installation for each size. The next line is typical energy
> production (kWh) that the system would produce over the life of the
> system (25 years warranty). Dividing the Net cost by energy produced
> gives the Cost of electricity with a solar PV system on a building:
> less than 12 cents/kWh for larger systems and nearly 15 cents/kWh for
> very small systems.
>
> Size
>
>
>
> 100 kW
>
>
>
> 10 kW
>
>
>
> 1 kW
>
> Price
>
>
>
> \$500,000.00
>
>
>
> \$55,000.00
>
>
>
> \$6,500.00
>
> Fed
>
>
>
> \$150,000.00
>
>
>
> \$16,500.00
>
>
>
> \$1,950.00
>
> Net
>
>
>
> \$350,000.00
>
>
>
> \$38,500.00
>
>
>
> \$4,550.00
>
> Production
>
>
>
>
>
> kWh/25yr
>
>
>
> 3,000,000
>
>
>
> 300,000
>
>
>
> 30,000
>
> Electricity
>
>
>
>
>
> Cost
>
>
>
> \$ 0.117
>
>
>
> \$ 0.128
>
>
>
> \$ 0.152
>
>
>
>

------------------------------------

No virus found in this incoming message.
Checked by AVG - www.avg.com
Version: 8.5.392 / Virus Database: 270.13.41/2277 - Release Date: 08/02/09
05:56:00

No virus found in this incoming message.
Checked by AVG - www.avg.com
Version: 8.5.392 / Virus Database: 270.13.41/2277 - Release Date: 08/02/09 05:56:00

• Greetings, With that kind of thinking, no wonder we are in the financial mess we are. There is no mention of end value. I have panels that are over 20 years
Message 13 of 29 , Aug 3, 2009
Greetings,
With that kind of thinking, no wonder we are in the financial mess we
are. There is no mention of end value. I have panels that are over 20
years old that are working just fine. I am not sure how old exactly,
but Kevin knows. I can tell you that they are going to last more than
25 years. There also is no value included to replace batteries, which
do not last 25 years. A bit of reality in the investment analysis would
be nice.

If I am looking at it as an investment, I would love to know where the
5.25% came from. I would love to be able to get that kind of interest
on my money.

Bright Blessings,
Kim

jay.ring@... wrote:
> Well you probably wouldn't get 100% financing over 25 years, but a ROI calculation would assume you do. Financially speaking, a PV system is like a certificate of deposit (CD) where you pay, say, a \$38,500 up front, but then get back, say, \$120 each month.
>
> You set the term to the useful life of the investment. So if the system survives 25 years you get 25 years of payments, and you evaluate it over a 25 year interval. You don't actually have to get a 25 year loan.
>
> In fact, you don't even have to get a loan at all. You could pay cash and the analysis doesn't change. You don't think of an investment costs a month; you think of what it produces each month.
>
> I hope that helps!
>
>
>
>
>
• Greetings, While I agree with what you said, I did buy my car because of millage and price tag. It was the most economical one I could find that both of my
Message 14 of 29 , Aug 3, 2009
Greetings,

While I agree with what you said, I did buy my car because of millage
and price tag. It was the most economical one I could find that both of
my dogs fit in the back seat of.

It has been years since CDs paid more than two or three percent
interest, so investing money in things makes better sense than ever. If
we want to evaluate the cost, look at investment incomes, not borrowing
costs.

Some of us live the simple life, but PV is part of it. I know a lot of
people that live off grid with less solar panels than I have.
Definitely less than a KW system. One guy lives with a 350 watt
system. I couldn't do that, but to each their own.

While I realize that this list is primarily for people in the city,
those of us that are rural can have a very different take on PV. It is
so much cheaper to put in a panel and a couple of batteries, in an
outbuilding than to run conduit and cable hundreds of feet. The basic
install has paid for the system. Front gates are another use of small
systems that really pay for themselves and are much cheaper than grid
supplied hook ups.

I think the main point is, how do you feel about your purchase? I do
believe you are right in that.

Bright Blessings,
Kim

Kevin Conlin wrote:
>
>
> Yes, I can't argue against a realistic financial perspective, *but** I
> also think that distorts the true value of the investment.* We seldom
> apply those rules to most of the other major purchases in our lives.
>
> We never think about the return on a set of golf clubs, a beautiful
> home, a sleek car or a granite countertop, but those investments make
> for a more fulfilling life, and we personally justify the extra
> expense by the satisfaction and enjoyment we get from using those
> items. How many people reading this bought their car because it was
> the cheapest and most economical one you could find? It more likely
> came down to personal choice and preference.
>
> If climate change, dwindling resources, environmental
> degradation, threatened wildlife, future generations, a sustainable
> society and lifestyle or any other issues are close to your heart,
> then you can make the right decision without regard for ROI, payback,
> cost of opportunity, etc...and feel real good about it.
>
> How many people use life cycle costing when buying a big screen TV, a
> stainless steel refrigerator, BBQ grill or new furniture? Then why do
> we always insist on imposing those rules on solar?
>
> If we only made decisions based on economics, this would be one empty,
> desolate planet....and we would do many things for the very wrong reasons.
>
> Value is so much more than just cost.....and I admire the people who
> make the right decisions for the "wrong" reasons.
>
>
>
> Kevin Conlin
> Heliosolar Design, Inc.
> 13534 Quetzal Lane
> Houston, TX 77083
> C: (281) 202-9629
> H: (281) 530-7501
> F: (281) 530-7501
> kevin@... <mailto:kevin@...>
>
>
>
>
• Greetings, Actually, only in the city do you have a choice about power suppliers. Not everyone has that option, by a long shot. This list serves Houston and
Message 15 of 29 , Aug 3, 2009
Greetings,
Actually, only in the city do you have a choice about power suppliers.
Not everyone has that option, by a long shot. This list serves Houston
and Surrounding Areas.

And today, living sustainably is considered Way Cool; Super trendy, and
Now. [I have been talking to my grandkids] My Mother says that Hubby and
I have become a status symbol with our family, they love to brag about
their Sister and Brother in Law in Texas that have a real, sustainable farm.

Bright Blessings,
Kim

Robert Johnston wrote:
>
>
> Yes, but you are pointing to the intangibles. How many people purchase
> PV because it is fun or sexy or anything like that? A few enthusiasts
> do. But most people are interested simply in getting electrical power;
> they don’t care how. As for the environment, climate change,
> etc.—remember that this is all available “on the grid” through
> renewable sources (windpower etc.). So it isn’t a choice between PV
> and climate change etc. The question is whether distributed power in
> the form of residential PV is cost competitive with renewable power
> distributed over the grid. The answer, I believe the analysis shows
> (if you factor in cost of capital), is “no”. Again, that doesn’t mean
> folks who get a thrill watching electrons chase holes in their PV
> panels won’t enjoy having them.
>
>
> Robert
>
> **
>
>
>
>
>
>
>
> ------------------------------------------------------------------------
>
• I think this is a nice example except for the fact that there is a huge assumption being made in that a 1.5 kW solar system could power an electric vehicle for
Message 16 of 29 , Aug 3, 2009
I think this is a nice example except for the fact that there is a huge assumption being made in that a 1.5 kW solar system could power an electric vehicle for the same amount of miles as the gas listed in the explanation.
Needless to say I have my doubts that you could run a vehicle on even 20 kWh a day.

-----Original Message-----
From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com]On Behalf Of Kevin Conlin
Sent: Sunday, August 02, 2009 5:13 PM
To: hreg@yahoogroups.com
Subject: [hreg] A different way to look at PV investment...

Good points all.

At the Solar 2009 conference a few months ago I heard a very interesting
analogy made. The premise was that if you invested in a 1.5 kw PV system and
drove an electric vehicle for the next 30 years, you would essentially have
paid for 30 years worth of fuel with the PV system. I don't remember all the
specific assumptions, but it assumed a useful life of 30 years for the pv.

1.5KW @ \$10,000 x .7 Federal Tax Credit = \$7,000/30 years = \$233/year.
Compared to a 25 mpg vehicle, current gasoline costs would be at least
\$800/year, and aren't likely to decline over 30 years time, but you could
also assume mileage improvements would be par with rising fuel costs.

I know you can take the example apart because of the assumptions and
simplified math, but the point was by investing in pv/ev you were displacing
foreign oil payments and reducing the trade deficit, spending the money
domestically and stimulating a growing industry, reducing CO2 and other
climate changing emissions, encouraging distributed energy on the grid as
well as saving money personally, over \$15,000.

As Kim alluded, the benefits aren't just financial; intangibles such as the
personal pride, enjoyment and fulfillment that come from ownership have
different values to different people.

Kevin Conlin
Heliosolar Design, Inc.
13534 Quetzal Lane
Houston, TX 77083
C: (281) 202-9629
H: (281) 530-7501
F: (281) 530-7501
kevin@heliosolardes ign.com

-----Original Message-----
From: hreg@yahoogroups. com [mailto:hreg@yahoogroups. com] On Behalf Of Garth
& Kim Travis
Sent: Sunday, August 02, 2009 3:40 PM
To: hreg@yahoogroups. com
Subject: Re: [hreg] Cost of solar PV installed.

Greetings,

Why would you factor 100% financing? Even mortgages require at least 5 or 10
percent down. Also, a 25 year term for a mere \$38,500? That is paying less
than \$2,000 a year in capital. Any financial adviser worth their salt would
tell you that is a bit silly, a 15 year period would be pretty maximum. How
many times over do you wish to pay for the system?

If you are going to include all of the joys of ownership, you should also
include the adjustments for the rising cost of electric, and the final value
of the system when it is paid for. Especially since when you pay the grid,
at the end of it all, you have nothing. It is like renting a home vs owning
a home. Initially it costs more to own, but in the long run, it is soooooo
much cheaper.

Bright Blessings,
Kim

Robert Johnston wrote:
>
>
> This doesn't factor in (1) the cost of capital or (2) increased
> property insurance rates.
>
> (1) If you assume 100% financing at mortgage rates of 5.25% for 25
> years, the monthly payment for a \$38,500 system (10kW) would be
> \$230.71. Using Chris' estimated output for a 10kW system of 1000
> kW/mo, that increases the cost to \$0.23/kwh.
>
> (2) I was recently quoted \$10 annually per \$1000 coverage on Texas
> Windstorm (possibly Houston is a bit less; I live in Lake Jackson,
> nearer the coast). Federal flood insurance currently runs me \$2.61 per
> \$1000 coverage. Homeowners insurance costs me \$3.73 per \$1000 of
> coverage. Thus, for all 3 coverages, a total of \$16.34 per \$1000 of
> coverage. Now, I don't know what exactly solar panels and controls add
> compared to the cost of the rest of the house itself, but if we
> conservatively assume that it incrementally increases insurance costs
> only at 75% of the rate of the rest of the house, that is \$12.26 per
> \$1000, or for a \$38,500 installation (assuming we only insure for the
> net cost to us after federal subsidies, not the replacement cost of
> the system), then that is an extra \$472 per year, or \$0.039/kwh. If
> insured at replacement cost, it will be correspondingly higher (I
> suspect you will be required by your insurance company to cover at
> replacement cost since that is what they are promising to do for you,
> and no federal subsidy will help them replace your system after a
> fire, hurricane, etc.). If rates are lower in your area, or you don't
> carry flood coverage, then rates would be somewhat lower.
>
>
> With the cost of financing and the cost of insurance factored in, the
> cost would be approximately \$0.27/kwh for a 10 kW system. Whereas
> \$0.128/kwh is similar to current REP rates, \$0.27/kwh is not.
>
> Robert Johnston
>
> *From:* hreg@yahoogroups. com [mailto:hreg@yahoogroups. com] *On Behalf
> Of *Chris Boyer
> *Sent:* Saturday, August 01, 2009 10:27 PM
> *To:* HREG
> *Subject:* [hreg] Cost of solar PV installed.
>
> Here is a simple calculation showing examples of the current economics
> for Solar PV in Houston. I mentioned this is the HREG meeting last
> Sunday, so here are the numbers. What it shows is the "Price" of
> installing a system of three sizes on a building (the upfront cash
> layout), from 100 kW, to 10 kW and 1 kW; then the Federal Tax Credit
> (which is now a rebate for commercial systems); and the Net cost of
> the solar installation for each size. The next line is typical energy
> production (kWh) that the system would produce over the life of the
> system (25 years warranty). Dividing the Net cost by energy produced
> gives the Cost of electricity with a solar PV system on a building:
> less than 12 cents/kWh for larger systems and nearly 15 cents/kWh for
> very small systems.
>
> Size
>
>
>
> 100 kW
>
>
>
> 10 kW
>
>
>
> 1 kW
>
> Price
>
>
>
> \$500,000.00
>
>
>
> \$55,000.00
>
>
>
> \$6,500.00
>
> Fed
>
>
>
> \$150,000.00
>
>
>
> \$16,500.00
>
>
>
> \$1,950.00
>
> Net
>
>
>
> \$350,000.00
>
>
>
> \$38,500.00
>
>
>
> \$4,550.00
>
> Production
>
>
>
>
>
> kWh/25yr
>
>
>
> 3,000,000
>
>
>
> 300,000
>
>
>
> 30,000
>
> Electricity
>
>
>
>
>
> Cost
>
>
>
> \$ 0.117
>
>
>
> \$ 0.128
>
>
>
> \$ 0.152
>
>
>
>

------------ --------- --------- ------

No virus found in this incoming message.
Checked by AVG - www.avg.com
Version: 8.5.392 / Virus Database: 270.13.41/2277 - Release Date: 08/02/09
05:56:00

• I assure you, that is how it is performed :) I know it might seem a little strange to someone who is unfamiliar with it, but it is sound in theory and in
Message 17 of 29 , Aug 3, 2009
I assure you, that is how it is performed :) I know it might seem a little strange to someone who is unfamiliar with it, but it is sound in theory and in practice.

Well anyway I agree that 25 years is probably not the true life of the panels. Most of them provide a warranty at least that long, so that is more of a minimum. I didn't pick the numbers so I don't need to defend them. But you take a realistic lifetime estimate and use that.

What you don't do is use an end of life value. You just use a longer term. Again, think of it like a ceertificate of deposit. You buy a system for \$38,500 and it pays you every month for 25 years, 30 years, whatever. Now you compare it to, say, a savings account. You put \$38,500 in a savings account and it pays you interest every month.

Imagine two people. One buys a PV system, the other puts the money in a savings account. The question then becomes, what interest rate does the savings account have to pay so that both people are getting the same amount of money back every month.

If the answer is 5%, and you can't find a savings account paying back that sort of interest, then you are better off getting the PV system. If, on the other hand, you -can- find a savings account paying that much, you are better off using the interest to buy clean power off the grid. If you are buying it on a loan, if the answer is 5%, and you can get a loan for less than 5%, then you are better off getting the PV.

That's all there is too it :) Again, I hope it helps.

And I completely agree with all those that say there is more to it than simple return on investment. Financial calculations are only a tiny part of a purchase decision. I just want to be sure makes a fully informed decision.

Have a good one!

--- In hreg@yahoogroups.com, Garth & Kim Travis <gartht@...> wrote:
>
> Greetings,
> With that kind of thinking, no wonder we are in the financial mess we
> are. There is no mention of end value. I have panels that are over 20
> years old that are working just fine. I am not sure how old exactly,
> but Kevin knows. I can tell you that they are going to last more than
> 25 years. There also is no value included to replace batteries, which
> do not last 25 years. A bit of reality in the investment analysis would
> be nice.
>
> If I am looking at it as an investment, I would love to know where the
> 5.25% came from. I would love to be able to get that kind of interest
> on my money.
>
> Bright Blessings,
> Kim
>
> jay.ring@... wrote:
> > Well you probably wouldn't get 100% financing over 25 years, but a ROI calculation would assume you do. Financially speaking, a PV system is like a certificate of deposit (CD) where you pay, say, a \$38,500 up front, but then get back, say, \$120 each month.
> >
> > You set the term to the useful life of the investment. So if the system survives 25 years you get 25 years of payments, and you evaluate it over a 25 year interval. You don't actually have to get a 25 year loan.
> >
> > In fact, you don't even have to get a loan at all. You could pay cash and the analysis doesn't change. You don't think of an investment costs a month; you think of what it produces each month.
> >
> > I hope that helps!
> >
> >
> >
> >
> >
>
• Hey Otto, You know I really agree with your vision. CSP is a fantastic technology for powering the grid. Combined with electric cars, it s a nearly complete
Message 18 of 29 , Aug 3, 2009
Hey Otto,

You know I really agree with your vision. CSP is a fantastic technology for powering the grid. Combined with electric cars, it's a nearly complete energy solution.

I also agree with the dangers of the subsidy. I think that is a great point and many people overlook it. (Although if it must exist I am not above taking advantage of it). I would hope people interested in sustainability would see the dangers of the unsustainable subsidy.

But I still think residential PV has a real place in out energy future, despite the higher cost of PV and even though CSP could do it alone if necessary. My reasoning is simple: Residential roof tops are "dead space". There is near-zero ecological impact from putting PV up there.

In my vision for the future, PV handles maybe 25% of the load, CSP handles the remainder and provides the energy storage.

Have a good one!

--- In hreg@yahoogroups.com, "Otto Glaser" <oglaser@...> wrote:
>
> There are a few things that are not being considered. The US Government has to borrow the money to give the owner of a PV system the tax credit. Based on past history, the government will borrow this money forever. The government will be paying interest on this money long after the PV system is gone.If a large number of people installed a PV system where would the government get the money to pay the tax credit? The cost of a back up system to supply electricity when the sun is not shining. The local utility is required to supply electricity when ever needed, so they would have to build generating plants to cover the demand when the sun was not shining. What source of power would they use to generate electricity? Coal or nuclear? Having the extra capacity that was little used would substantially increase the cost of electricity from the utility. Guess who would pay for that. The tax credit would mostly go to higher income people as poor people would not have enough income to use the tax credit. What that does is take money from poor people and give it to rich people. The poor would have to pay those higher rates. It is more expensive to install PV on each house than to install a Solar Power Tower central system. I was told that a PV system costs about \$8 per watt to install. A central system costs about \$1.00 per watt. If Rice University gets there nano tech wire perfected it would eliminate enough line loss to enable us to shut down 30% of our present generating capacity. I believe that when we get to mass producing Solar Power Tower electric generating plants, the cost will come down enough that it will be the cheapest form of generation. Presently, a SPT plant costs 1/2 as much to build as a nuclear plant-has no fuel cost and is much cheaper to operate.
> Otto Glaser
> 12111 Medina Bend Lane
> Houston, TX 77041-6694
> Phone and Fax 713-896-9935
> Email oglaser@...
>
> ----- Original Message -----
> From: Robert Johnston
> To: hreg@yahoogroups.com
> Sent: Sunday, August 02, 2009 7:43 PM
> Subject: RE: [hreg] A different way to look at PV investment... cost vs. value
>
>
>
> Yes, but you are pointing to the intangibles. How many people purchase PV because it is fun or sexy or anything like that? A few enthusiasts do. But most people are interested simply in getting electrical power; they don't care how. As for the environment, climate change, etc.-remember that this is all available "on the grid" through renewable sources (windpower etc.). So it isn't a choice between PV and climate change etc. The question is whether distributed power in the form of residential PV is cost competitive with renewable power distributed over the grid. The answer, I believe the analysis shows (if you factor in cost of capital), is "no". Again, that doesn't mean folks who get a thrill watching electrons chase holes in their PV panels won't enjoy having them.
>
>
> Robert
>
>
>
>
>
> From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of Kevin Conlin
> Sent: Sunday, August 02, 2009 7:12 PM
> To: hreg@yahoogroups.com
> Subject: [hreg] A different way to look at PV investment... cost vs. value
>
>
>
>
>
> Yes, I can't argue against a realistic financial perspective, but I also think that distorts the true value of the investment. We seldom apply those rules to most of the other major purchases in our lives.
>
>
>
> We never think about the return on a set of golf clubs, a beautiful home, a sleek car or a granite countertop, but those investments make for a more fulfilling life, and we personally justify the extra expense by the satisfaction and enjoyment we get from using those items. How many people reading this bought their car because it was the cheapest and most economical one you could find? It more likely came down to personal choice and preference.
>
>
>
> If climate change, dwindling resources, environmental degradation, threatened wildlife, future generations, a sustainable society and lifestyle or any other issues are close to your heart, then you can make the right decision without regard for ROI, payback, cost of opportunity, etc...and feel real good about it.
>
>
>
> How many people use life cycle costing when buying a big screen TV, a stainless steel refrigerator, BBQ grill or new furniture? Then why do we always insist on imposing those rules on solar?
>
>
>
> If we only made decisions based on economics, this would be one empty, desolate planet....and we would do many things for the very wrong reasons.
>
>
>
> Value is so much more than just cost.....and I admire the people who make the right decisions for the "wrong" reasons.
>
>
>
>
>
>
>
> Kevin Conlin
>
> Heliosolar Design, Inc.
>
> 13534 Quetzal Lane
>
> Houston, TX 77083
>
> C: (281) 202-9629
>
> H: (281) 530-7501
>
> F: (281) 530-7501
>
> kevin@...
>
>
>
>
>
>
>
>
>
>
> ------------------------------------------------------------------------------
>
> From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of Robert Johnston
> Sent: Sunday, August 02, 2009 5:40 PM
> To: hreg@yahoogroups.com
> Subject: RE: [hreg] A different way to look at PV investment...
>
>
>
> I see you posted while I was composing my last post. Just a quick comment.
>
> Your last paragraph is the key one-for some people, the intangibles make it worth it. That's fine, so long as the true financial cost isn't obscured. Using the example of an electric vehicle just creates a mental image of something green and neat-free transportation fuel! But from a financial perspective, one would want to do the comparison on the basis of the cost of metered electricity from the grid vs. the cost of electricity from PV-regardless of whether it is used for an electric car or for anything else you wanted it for. In that case, the calculation must still factor in cost of capital etc. as I argued. i.e., regardless of the use, one should just make the calculation on the basis of cost per kwh.
>
> Robert
>
> From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of Kevin Conlin
> Sent: Sunday, August 02, 2009 5:13 PM
> To: hreg@yahoogroups.com
> Subject: [hreg] A different way to look at PV investment...
>
>
>
> Good points all.
>
> At the Solar 2009 conference a few months ago I heard a very interesting
> analogy made. The premise was that if you invested in a 1.5 kw PV system and
> drove an electric vehicle for the next 30 years, you would essentially have
> paid for 30 years worth of fuel with the PV system. I don't remember all the
> specific assumptions, but it assumed a useful life of 30 years for the pv.
>
> 1.5KW @ \$10,000 x .7 Federal Tax Credit = \$7,000/30 years = \$233/year.
> Compared to a 25 mpg vehicle, current gasoline costs would be at least
> \$800/year, and aren't likely to decline over 30 years time, but you could
> also assume mileage improvements would be par with rising fuel costs.
>
> I know you can take the example apart because of the assumptions and
> simplified math, but the point was by investing in pv/ev you were displacing
> foreign oil payments and reducing the trade deficit, spending the money
> domestically and stimulating a growing industry, reducing CO2 and other
> climate changing emissions, encouraging distributed energy on the grid as
> well as saving money personally, over \$15,000.
>
> As Kim alluded, the benefits aren't just financial; intangibles such as the
> personal pride, enjoyment and fulfillment that come from ownership have
> different values to different people.
>
> Kevin Conlin
> Heliosolar Design, Inc.
> 13534 Quetzal Lane
> Houston, TX 77083
> C: (281) 202-9629
> H: (281) 530-7501
> F: (281) 530-7501
> kevin@...
>
>
>
> -----Original Message-----
> From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of Garth
> & Kim Travis
> Sent: Sunday, August 02, 2009 3:40 PM
> To: hreg@yahoogroups.com
> Subject: Re: [hreg] Cost of solar PV installed.
>
> Greetings,
>
> Why would you factor 100% financing? Even mortgages require at least 5 or 10
> percent down. Also, a 25 year term for a mere \$38,500? That is paying less
> than \$2,000 a year in capital. Any financial adviser worth their salt would
> tell you that is a bit silly, a 15 year period would be pretty maximum. How
> many times over do you wish to pay for the system?
>
> If you are going to include all of the joys of ownership, you should also
> include the adjustments for the rising cost of electric, and the final value
> of the system when it is paid for. Especially since when you pay the grid,
> at the end of it all, you have nothing. It is like renting a home vs owning
> a home. Initially it costs more to own, but in the long run, it is soooooo
> much cheaper.
>
> Bright Blessings,
> Kim
>
> Robert Johnston wrote:
> >
> >
> > This doesn't factor in (1) the cost of capital or (2) increased
> > property insurance rates.
> >
> > (1) If you assume 100% financing at mortgage rates of 5.25% for 25
> > years, the monthly payment for a \$38,500 system (10kW) would be
> > \$230.71. Using Chris' estimated output for a 10kW system of 1000
> > kW/mo, that increases the cost to \$0.23/kwh.
> >
> > (2) I was recently quoted \$10 annually per \$1000 coverage on Texas
> > Windstorm (possibly Houston is a bit less; I live in Lake Jackson,
> > nearer the coast). Federal flood insurance currently runs me \$2.61 per
> > \$1000 coverage. Homeowners insurance costs me \$3.73 per \$1000 of
> > coverage. Thus, for all 3 coverages, a total of \$16.34 per \$1000 of
> > coverage. Now, I don't know what exactly solar panels and controls add
> > compared to the cost of the rest of the house itself, but if we
> > conservatively assume that it incrementally increases insurance costs
> > only at 75% of the rate of the rest of the house, that is \$12.26 per
> > \$1000, or for a \$38,500 installation (assuming we only insure for the
> > net cost to us after federal subsidies, not the replacement cost of
> > the system), then that is an extra \$472 per year, or \$0.039/kwh. If
> > insured at replacement cost, it will be correspondingly higher (I
> > suspect you will be required by your insurance company to cover at
> > replacement cost since that is what they are promising to do for you,
> > and no federal subsidy will help them replace your system after a
> > fire, hurricane, etc.). If rates are lower in your area, or you don't
> > carry flood coverage, then rates would be somewhat lower.
> >
> >
> > With the cost of financing and the cost of insurance factored in, the
> > cost would be approximately \$0.27/kwh for a 10 kW system. Whereas
> > \$0.128/kwh is similar to current REP rates, \$0.27/kwh is not.
> >
> > Robert Johnston
> >
> > *From:* hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] *On Behalf
> > Of *Chris Boyer
> > *Sent:* Saturday, August 01, 2009 10:27 PM
> > *To:* HREG
> > *Subject:* [hreg] Cost of solar PV installed.
> >
> > Here is a simple calculation showing examples of the current economics
> > for Solar PV in Houston. I mentioned this is the HREG meeting last
> > Sunday, so here are the numbers. What it shows is the "Price" of
> > installing a system of three sizes on a building (the upfront cash
> > layout), from 100 kW, to 10 kW and 1 kW; then the Federal Tax Credit
> > (which is now a rebate for commercial systems); and the Net cost of
> > the solar installation for each size. The next line is typical energy
> > production (kWh) that the system would produce over the life of the
> > system (25 years warranty). Dividing the Net cost by energy produced
> > gives the Cost of electricity with a solar PV system on a building:
> > less than 12 cents/kWh for larger systems and nearly 15 cents/kWh for
> > very small systems.
> >
> > Size
> >
> >
> >
> > 100 kW
> >
> >
> >
> > 10 kW
> >
> >
> >
> > 1 kW
> >
> > Price
> >
> >
> >
> > \$500,000.00
> >
> >
> >
> > \$55,000.00
> >
> >
> >
> > \$6,500.00
> >
> > Fed
> >
> >
> >
> > \$150,000.00
> >
> >
> >
> > \$16,500.00
> >
> >
> >
> > \$1,950.00
> >
> > Net
> >
> >
> >
> > \$350,000.00
> >
> >
> >
> > \$38,500.00
> >
> >
> >
> > \$4,550.00
> >
> > Production
> >
> >
> >
> >
> >
> > kWh/25yr
> >
> >
> >
> > 3,000,000
> >
> >
> >
> > 300,000
> >
> >
> >
> > 30,000
> >
> > Electricity
> >
> >
> >
> >
> >
> > Cost
> >
> >
> >
> > \$ 0.117
> >
> >
> >
> > \$ 0.128
> >
> >
> >
> > \$ 0.152
> >
> >
> >
> >
>
> ------------------------------------
>
>
> No virus found in this incoming message.
> Checked by AVG - www.avg.com
> Version: 8.5.392 / Virus Database: 270.13.41/2277 - Release Date: 08/02/09
> 05:56:00
>
> No virus found in this incoming message.
> Checked by AVG - www.avg.com
> Version: 8.5.392 / Virus Database: 270.13.41/2277 - Release Date: 08/02/09 05:56:00
>
• Here is the electric vehicle math. My small EV consumes 200 watt hours per mile. With 1.5 kWatt of panels, you can harvest 2376 kWatt-hr per year or 6.5
Message 19 of 29 , Aug 3, 2009
Here is the electric vehicle math. My small EV consumes 200 watt hours per mile. With 1.5 kWatt of panels, you can harvest 2376 kWatt-hr per year or 6.5 kWatt-hr per day. 6500/200 = 32 miles per day.
The source of energy harvested per year is <http://rredc.nrel.gov/solar/codes_algs/PVWATTS/version1/US/> Choose Texas, click on Houston, and enter the data. I have used tracking solar arrays.

Thanks,Bill S
Ph 832-338-3080
www.promotingevs.com

From: Russell Warren <rrwarren@...>
To: hreg@yahoogroups.com
Sent: Monday, August 3, 2009 7:53:18 AM
Subject: RE: [hreg] A different way to look at PV investment...

I think this is a nice example except for the fact that there is a huge assumption being made in that a 1.5 kW solar system could power an electric vehicle for the same amount of miles as the gas listed in the explanation.
Needless to say I have my doubts that you could run a vehicle on even 20 kWh a day.

-----Original Message-----
From: hreg@yahoogroups. com [mailto:hreg@ yahoogroups. com]On Behalf Of Kevin Conlin
Sent: Sunday, August 02, 2009 5:13 PM
To: hreg@yahoogroups. com
Subject: [hreg] A different way to look at PV investment.. .

Good points all.

At the Solar 2009 conference a few months ago I heard a very interesting
analogy made. The premise was that if you invested in a 1.5 kw PV system and
drove an electric vehicle for the next 30 years, you would essentially have
paid for 30 years worth of fuel with the PV system. I don't remember all the
specific assumptions, but it assumed a useful life of 30 years for the pv.

1.5KW @ \$10,000 x .7 Federal Tax Credit = \$7,000/30 years = \$233/year.
Compared to a 25 mpg vehicle, current gasoline costs would be at least
\$800/year, and aren't likely to decline over 30 years time, but you could
also assume mileage improvements would be par with rising fuel costs.

I know you can take the example apart because of the assumptions and
simplified math, but the point was by investing in pv/ev you were displacing
foreign oil payments and reducing the trade deficit, spending the money
domestically and stimulating a growing industry, reducing CO2 and other
climate changing emissions, encouraging distributed energy on the grid as
well as saving money personally, over \$15,000.

As Kim alluded, the benefits aren't just financial; intangibles such as the
personal pride, enjoyment and fulfillment that come from ownership have
different values to different people.

Kevin Conlin
Heliosolar Design, Inc.
13534 Quetzal Lane
Houston, TX 77083
C: (281) 202-9629
H: (281) 530-7501
F: (281) 530-7501
kevin@heliosolardes ign.com

-----Original Message-----
From: hreg@yahoogroups. com [mailto:hreg@yahoogroups. com] On Behalf Of Garth
& Kim Travis
Sent: Sunday, August 02, 2009 3:40 PM
To: hreg@yahoogroups. com
Subject: Re: [hreg] Cost of solar PV installed.

Greetings,

Why would you factor 100% financing? Even mortgages require at least 5 or 10
percent down. Also, a 25 year term for a mere \$38,500? That is paying less
than \$2,000 a year in capital. Any financial adviser worth their salt would
tell you that is a bit silly, a 15 year period would be pretty maximum. How
many times over do you wish to pay for the system?

If you are going to include all of the joys of ownership, you should also
include the adjustments for the rising cost of electric, and the final value
of the system when it is paid for. Especially since when you pay the grid,
at the end of it all, you have nothing. It is like renting a home vs owning
a home. Initially it costs more to own, but in the long run, it is soooooo
much cheaper.

Bright Blessings,
Kim

Robert Johnston wrote:
>
>
> This doesn't factor in (1) the cost of capital or (2) increased
> property insurance rates.
>
> (1) If you assume 100% financing at mortgage rates of 5.25% for 25
> years, the monthly payment for a \$38,500 system (10kW) would be
> \$230.71. Using Chris' estimated output for a 10kW system of 1000
> kW/mo, that increases the cost to \$0.23/kwh.
>
> (2) I was recently quoted \$10 annually per \$1000 coverage on Texas
> Windstorm (possibly Houston is a bit less; I live in Lake Jackson,
> nearer the coast). Federal flood insurance currently runs me \$2.61 per
> \$1000 coverage. Homeowners insurance costs me \$3.73 per \$1000 of
> coverage. Thus, for all 3 coverages, a total of \$16.34 per \$1000 of
> coverage. Now, I don't know what exactly solar panels and controls add
> compared to the cost of the rest of the house itself, but if we
> conservatively assume that it incrementally increases insurance costs
> only at 75% of the rate of the rest of the house, that is \$12.26 per
> \$1000, or for a \$38,500 installation (assuming we only insure for the
> net cost to us after federal subsidies, not the replacement cost of
> the system), then that is an extra \$472 per year, or \$0.039/kwh. If
> insured at replacement cost, it will be correspondingly higher (I
> suspect you will be required by your insurance company to cover at
> replacement cost since that is what they are promising to do for you,
> and no federal subsidy will help them replace your system after a
> fire, hurricane, etc.). If rates are lower in your area, or you don't
> carry flood coverage, then rates would be somewhat lower.
>
>
> With the cost of financing and the cost of insurance factored in, the
> cost would be approximately \$0.27/kwh for a 10 kW system. Whereas
> \$0.128/kwh is similar to current REP rates, \$0.27/kwh is not.
>
> Robert Johnston
>
> *From:* hreg@yahoogroups. com [mailto:hreg@yahoogroups. com] *On Behalf
> Of *Chris Boyer
> *Sent:* Saturday, August 01, 2009 10:27 PM
> *To:* HREG
> *Subject:* [hreg] Cost of solar PV installed.
>
> Here is a simple calculation showing examples of the current economics
> for Solar PV in Houston. I mentioned this is the HREG meeting last
> Sunday, so here are the numbers. What it shows is the "Price" of
> installing a system of three sizes on a building (the upfront cash
> layout), from 100 kW, to 10 kW and 1 kW; then the Federal Tax Credit
> (which is now a rebate for commercial systems); and the Net cost of
> the solar installation for each size. The next line is typical energy
> production (kWh) that the system would produce over the life of the
> system (25 years warranty). Dividing the Net cost by energy produced
> gives the Cost of electricity with a solar PV system on a building:
> less than 12 cents/kWh for larger systems and nearly 15 cents/kWh for
> very small systems.
>
> Size
>
>
>
> 100 kW
>
>
>
> 10 kW
>
>
>
> 1 kW
>
> Price
>
>
>
> \$500,000.00
>
>
>
> \$55,000.00
>
>
>
> \$6,500.00
>
> Fed
>
>
>
> \$150,000.00
>
>
>
> \$16,500.00
>
>
>
> \$1,950.00
>
> Net
>
>
>
> \$350,000.00
>
>
>
> \$38,500.00
>
>
>
> \$4,550.00
>
> Production
>
>
>
>
>
> kWh/25yr
>
>
>
> 3,000,000
>
>
>
> 300,000
>
>
>
> 30,000
>
> Electricity
>
>
>
>
>
> Cost
>
>
>
> \$ 0.117
>
>
>
> \$ 0.128
>
>
>
> \$ 0.152
>
>
>
>

------------ --------- --------- ------

No virus found in this incoming message.
Checked by AVG - www.avg.com
Version: 8.5.392 / Virus Database: 270.13.41/2277 - Release Date: 08/02/09
05:56:00

• There is no question that there isnt a financial incentive to install PV right now in Houston. However there is an intangible value to doing the right thing,
Message 20 of 29 , Aug 3, 2009
There is no question that there isnt a financial incentive to install PV right now in Houston.
However there is an intangible value to doing the right thing,
If you have the expendable capital, Instead of buying that shiny new BMW. Lets put up \$30k of panels, Install a high efficiency heatpump. Replace our lighting and lighting controls for CFL. Install light tubes for high traffic locations, and increase the efficacy of our insulation. And last but not least install a sexy solar hot water panel.

Then wait on car purchase for some of the new truely electric cars coming out.

YMMV

Mac

From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of Bill or Dorothy Swann
Sent: Monday, August 03, 2009 9:19 AM
To: hreg@yahoogroups.com
Subject: Re: [hreg] A different way to look at PV investment...

Here is the electric vehicle math. My small EV consumes 200 watt hours per mile. With 1.5 kWatt of panels, you can harvest 2376 kWatt-hr per year or 6.5 kWatt-hr per day. 6500/200 = 32 miles per day.
The source of energy harvested per year is <http://rredc. nrel.gov/ solar/codes_ algs/PVWATTS/ version1/ US/> Choose Texas, click on Houston, and enter the data. I have used tracking solar arrays.

Thanks,Bill S
Ph 832-338-3080
www.promotingevs. com

To: hreg@yahoogroups. com
Sent: Monday, August 3, 2009 7:53:18 AM
Subject: RE: [hreg] A different way to look at PV investment.. .

I think this is a nice example except for the fact that there is a huge assumption being made in that a 1.5 kW solar system could power an electric vehicle for the same amount of miles as the gas listed in the explanation.
Needless to say I have my doubts that you could run a vehicle on even 20 kWh a day.

-----Original Message-----
From: hreg@yahoogroups. com [mailto:hreg@ yahoogroups. com]On Behalf Of Kevin Conlin
Sent: Sunday, August 02, 2009 5:13 PM
To: hreg@yahoogroups. com
Subject: [hreg] A different way to look at PV investment.. .

Good points all.

At the Solar 2009 conference a few months ago I heard a very interesting
analogy made. The premise was that if you invested in a 1.5 kw PV system and
drove an electric vehicle for the next 30 years, you would essentially have
paid for 30 years worth of fuel with the PV system. I don't remember all the
specific assumptions, but it assumed a useful life of 30 years for the pv.

1.5KW @ \$10,000 x .7 Federal Tax Credit = \$7,000/30 years = \$233/year.
Compared to a 25 mpg vehicle, current gasoline costs would be at least
\$800/year, and aren't likely to decline over 30 years time, but you could
also assume mileage improvements would be par with rising fuel costs.

I know you can take the example apart because of the assumptions and
simplified math, but the point was by investing in pv/ev you were displacing
foreign oil payments and reducing the trade deficit, spending the money
domestically and stimulating a growing industry, reducing CO2 and other
climate changing emissions, encouraging distributed energy on the grid as
well as saving money personally, over \$15,000.

As Kim alluded, the benefits aren't just financial; intangibles such as the
personal pride, enjoyment and fulfillment that come from ownership have
different values to different people.

Kevin Conlin
Heliosolar Design, Inc.
13534 Quetzal Lane
Houston, TX 77083
C: (281) 202-9629
H: (281) 530-7501
F: (281) 530-7501
kevin@heliosolardes ign.com

-----Original Message-----
From: hreg@yahoogroups. com [mailto:hreg@yahoogroups. com] On Behalf Of Garth
& Kim Travis
Sent: Sunday, August 02, 2009 3:40 PM
To: hreg@yahoogroups. com
Subject: Re: [hreg] Cost of solar PV installed.

Greetings,

Why would you factor 100% financing? Even mortgages require at least 5 or 10
percent down. Also, a 25 year term for a mere \$38,500? That is paying less
than \$2,000 a year in capital. Any financial adviser worth their salt would
tell you that is a bit silly, a 15 year period would be pretty maximum. How
many times over do you wish to pay for the system?

If you are going to include all of the joys of ownership, you should also
include the adjustments for the rising cost of electric, and the final value
of the system when it is paid for. Especially since when you pay the grid,
at the end of it all, you have nothing. It is like renting a home vs owning
a home. Initially it costs more to own, but in the long run, it is soooooo
much cheaper.

Bright Blessings,
Kim

Robert Johnston wrote:
>
>
> This doesn't factor in (1) the cost of capital or (2) increased
> property insurance rates.
>
> (1) If you assume 100% financing at mortgage rates of 5.25% for 25
> years, the monthly payment for a \$38,500 system (10kW) would be
> \$230.71. Using Chris' estimated output for a 10kW system of 1000
> kW/mo, that increases the cost to \$0.23/kwh.
>
> (2) I was recently quoted \$10 annually per \$1000 coverage on Texas
> Windstorm (possibly Houston is a bit less; I live in Lake Jackson,
> nearer the coast). Federal flood insurance currently runs me \$2.61 per
> \$1000 coverage. Homeowners insurance costs me \$3.73 per \$1000 of
> coverage. Thus, for all 3 coverages, a total of \$16.34 per \$1000 of
> coverage. Now, I don't know what exactly solar panels and controls add
> compared to the cost of the rest of the house itself, but if we
> conservatively assume that it incrementally increases insurance costs
> only at 75% of the rate of the rest of the house, that is \$12.26 per
> \$1000, or for a \$38,500 installation (assuming we only insure for the
> net cost to us after federal subsidies, not the replacement cost of
> the system), then that is an extra \$472 per year, or \$0.039/kwh. If
> insured at replacement cost, it will be correspondingly higher (I
> suspect you will be required by your insurance company to cover at
> replacement cost since that is what they are promising to do for you,
> and no federal subsidy will help them replace your system after a
> fire, hurricane, etc.). If rates are lower in your area, or you don't
> carry flood coverage, then rates would be somewhat lower.
>
>
> With the cost of financing and the cost of insurance factored in, the
> cost would be approximately \$0.27/kwh for a 10 kW system. Whereas
> \$0.128/kwh is similar to current REP rates, \$0.27/kwh is not.
>
> Robert Johnston
>
> *From:* hreg@yahoogroups. com [mailto:hreg@yahoogroups. com] *On Behalf
> Of *Chris Boyer
> *Sent:* Saturday, August 01, 2009 10:27 PM
> *To:* HREG
> *Subject:* [hreg] Cost of solar PV installed.
>
> Here is a simple calculation showing examples of the current economics
> for Solar PV in Houston. I mentioned this is the HREG meeting last
> Sunday, so here are the numbers. What it shows is the "Price" of
> installing a system of three sizes on a building (the upfront cash
> layout), from 100 kW, to 10 kW and 1 kW; then the Federal Tax Credit
> (which is now a rebate for commercial systems); and the Net cost of
> the solar installation for each size. The next line is typical energy
> production (kWh) that the system would produce over the life of the
> system (25 years warranty). Dividing the Net cost by energy produced
> gives the Cost of electricity with a solar PV system on a building:
> less than 12 cents/kWh for larger systems and nearly 15 cents/kWh for
> very small systems.
>
> Size
>
>
>
> 100 kW
>
>
>
> 10 kW
>
>
>
> 1 kW
>
> Price
>
>
>
> \$500,000.00
>
>
>
> \$55,000.00
>
>
>
> \$6,500.00
>
> Fed
>
>
>
> \$150,000.00
>
>
>
> \$16,500.00
>
>
>
> \$1,950.00
>
> Net
>
>
>
> \$350,000.00
>
>
>
> \$38,500.00
>
>
>
> \$4,550.00
>
> Production
>
>
>
>
>
> kWh/25yr
>
>
>
> 3,000,000
>
>
>
> 300,000
>
>
>
> 30,000
>
> Electricity
>
>
>
>
>
> Cost
>
>
>
> \$ 0.117
>
>
>
> \$ 0.128
>
>
>
> \$ 0.152
>
>
>
>

------------ --------- --------- ------

No virus found in this incoming message.
Checked by AVG - www.avg.com
Version: 8.5.392 / Virus Database: 270.13.41/2277 - Release Date: 08/02/09
05:56:00

• Thanks, Bill, I assumed 250W/hr per mile, approx. what a Toyota Prius uses. I wasn t trying to present the perfect example, merely pointing out a different
Message 21 of 29 , Aug 3, 2009
Thanks, Bill, I assumed 250W/hr per mile, approx. what a Toyota Prius uses.

I wasn't trying to present the perfect example, merely pointing out a different perspective.

I am very familiar with the practical aspects of the technology, but I also think the best decision making doesn't just look at one aspect.

You can sure simplify the decision that way, but that doesn't make it right for everyone.

Kevin Conlin
Heliosolar Design, Inc.
13534 Quetzal Lane
Houston, TX 77083
C:  (281) 202-9629
H:  (281) 530-7501
F:  (281) 530-7501

From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of Bill or Dorothy Swann
Sent: Monday, August 03, 2009 9:19 AM
To: hreg@yahoogroups.com
Subject: Re: [hreg] A different way to look at PV investment...

Here is the electric vehicle math. My small EV consumes 200 watt hours per mile. With 1.5 kWatt of panels, you can harvest 2376 kWatt-hr per year or 6.5 kWatt-hr per day. 6500/200 = 32 miles per day.
The source of energy harvested per year is <http://rredc. nrel.gov/ solar/codes_ algs/PVWATTS/ version1/ US/> Choose Texas, click on Houston, and enter the data. I have used tracking solar arrays.

Thanks,Bill S
Ph 832-338-3080
www.promotingevs. com

To: hreg@yahoogroups. com
Sent: Monday, August 3, 2009 7:53:18 AM
Subject: RE: [hreg] A different way to look at PV investment.. .

I think this is a nice example except for the fact that there is a huge assumption being made in that a 1.5 kW solar system could power an electric vehicle for the same amount of miles as the gas listed in the explanation.
Needless to say I have my doubts that you could run a vehicle on even 20 kWh a day.

-----Original Message-----
From: hreg@yahoogroups. com [mailto:hreg@ yahoogroups. com]On Behalf Of Kevin Conlin
Sent: Sunday, August 02, 2009 5:13 PM
To: hreg@yahoogroups. com
Subject: [hreg] A different way to look at PV investment.. .

Good points all.

At the Solar 2009 conference a few months ago I heard a very interesting
analogy made. The premise was that if you invested in a 1.5 kw PV system and
drove an electric vehicle for the next 30 years, you would essentially have
paid for 30 years worth of fuel with the PV system. I don't remember all the
specific assumptions, but it assumed a useful life of 30 years for the pv.

1.5KW @ \$10,000 x .7 Federal Tax Credit = \$7,000/30 years = \$233/year.
Compared to a 25 mpg vehicle, current gasoline costs would be at least
\$800/year, and aren't likely to decline over 30 years time, but you could
also assume mileage improvements would be par with rising fuel costs.

I know you can take the example apart because of the assumptions and
simplified math, but the point was by investing in pv/ev you were displacing
foreign oil payments and reducing the trade deficit, spending the money
domestically and stimulating a growing industry, reducing CO2 and other
climate changing emissions, encouraging distributed energy on the grid as
well as saving money personally, over \$15,000.

As Kim alluded, the benefits aren't just financial; intangibles such as the
personal pride, enjoyment and fulfillment that come from ownership have
different values to different people.

Kevin Conlin
Heliosolar Design, Inc.
13534 Quetzal Lane
Houston, TX 77083
C: (281) 202-9629
H: (281) 530-7501
F: (281) 530-7501
kevin@heliosolardes ign.com

-----Original Message-----
From: hreg@yahoogroups. com [mailto:hreg@yahoogroups. com] On Behalf Of Garth
& Kim Travis
Sent: Sunday, August 02, 2009 3:40 PM
To: hreg@yahoogroups. com
Subject: Re: [hreg] Cost of solar PV installed.

Greetings,

Why would you factor 100% financing? Even mortgages require at least 5 or 10
percent down. Also, a 25 year term for a mere \$38,500? That is paying less
than \$2,000 a year in capital. Any financial adviser worth their salt would
tell you that is a bit silly, a 15 year period would be pretty maximum. How
many times over do you wish to pay for the system?

If you are going to include all of the joys of ownership, you should also
include the adjustments for the rising cost of electric, and the final value
of the system when it is paid for. Especially since when you pay the grid,
at the end of it all, you have nothing. It is like renting a home vs owning
a home. Initially it costs more to own, but in the long run, it is soooooo
much cheaper.

Bright Blessings,
Kim

Robert Johnston wrote:
>
>
> This doesn't factor in (1) the cost of capital or (2) increased
> property insurance rates.
>
> (1) If you assume 100% financing at mortgage rates of 5.25% for 25
> years, the monthly payment for a \$38,500 system (10kW) would be
> \$230.71. Using Chris' estimated output for a 10kW system of 1000
> kW/mo, that increases the cost to \$0.23/kwh.
>
> (2) I was recently quoted \$10 annually per \$1000 coverage on Texas
> Windstorm (possibly Houston is a bit less; I live in Lake Jackson,
> nearer the coast). Federal flood insurance currently runs me \$2.61 per
> \$1000 coverage. Homeowners insurance costs me \$3.73 per \$1000 of
> coverage. Thus, for all 3 coverages, a total of \$16.34 per \$1000 of
> coverage. Now, I don't know what exactly solar panels and controls add
> compared to the cost of the rest of the house itself, but if we
> conservatively assume that it incrementally increases insurance costs
> only at 75% of the rate of the rest of the house, that is \$12.26 per
> \$1000, or for a \$38,500 installation (assuming we only insure for the
> net cost to us after federal subsidies, not the replacement cost of
> the system), then that is an extra \$472 per year, or \$0.039/kwh. If
> insured at replacement cost, it will be correspondingly higher (I
> suspect you will be required by your insurance company to cover at
> replacement cost since that is what they are promising to do for you,
> and no federal subsidy will help them replace your system after a
> fire, hurricane, etc.). If rates are lower in your area, or you don't
> carry flood coverage, then rates would be somewhat lower.
>
>
> With the cost of financing and the cost of insurance factored in, the
> cost would be approximately \$0.27/kwh for a 10 kW system. Whereas
> \$0.128/kwh is similar to current REP rates, \$0.27/kwh is not.
>
> Robert Johnston
>
> *From:* hreg@yahoogroups. com [mailto:hreg@yahoogroups. com] *On Behalf
> Of *Chris Boyer
> *Sent:* Saturday, August 01, 2009 10:27 PM
> *To:* HREG
> *Subject:* [hreg] Cost of solar PV installed.
>
> Here is a simple calculation showing examples of the current economics
> for Solar PV in Houston. I mentioned this is the HREG meeting last
> Sunday, so here are the numbers. What it shows is the "Price" of
> installing a system of three sizes on a building (the upfront cash
> layout), from 100 kW, to 10 kW and 1 kW; then the Federal Tax Credit
> (which is now a rebate for commercial systems); and the Net cost of
> the solar installation for each size. The next line is typical energy
> production (kWh) that the system would produce over the life of the
> system (25 years warranty). Dividing the Net cost by energy produced
> gives the Cost of electricity with a solar PV system on a building:
> less than 12 cents/kWh for larger systems and nearly 15 cents/kWh for
> very small systems.
>
> Size
>
>
>
> 100 kW
>
>
>
> 10 kW
>
>
>
> 1 kW
>
> Price
>
>
>
> \$500,000.00
>
>
>
> \$55,000.00
>
>
>
> \$6,500.00
>
> Fed
>
>
>
> \$150,000.00
>
>
>
> \$16,500.00
>
>
>
> \$1,950.00
>
> Net
>
>
>
> \$350,000.00
>
>
>
> \$38,500.00
>
>
>
> \$4,550.00
>
> Production
>
>
>
>
>
> kWh/25yr
>
>
>
> 3,000,000
>
>
>
> 300,000
>
>
>
> 30,000
>
> Electricity
>
>
>
>
>
> Cost
>
>
>
> \$ 0.117
>
>
>
> \$ 0.128
>
>
>
> \$ 0.152
>
>
>
>

------------ --------- --------- ------

No virus found in this incoming message.
Checked by AVG - www.avg.com
Version: 8.5.392 / Virus Database: 270.13.41/2277 - Release Date: 08/02/09
05:56:00

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Checked by AVG - www.avg.com
Version: 8.5.392 / Virus Database: 270.13.42/2279 - Release Date: 08/03/09 05:57:00

• Great approach. Once you have enough solar PVs on your roof, and an electric car, you ve turned the corner towards grid and oil based fuel* independency. Gary
Message 22 of 29 , Aug 3, 2009

Great approach.  Once you have enough solar PVs on your roof, and an electric car, you've turned the corner towards grid and oil based fuel* independency.

Gary

* still need oil for fertilizer, plastics, and adhesives

From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of James McKethen
Sent: Monday, August 03, 2009 10:44 AM
To: hreg@yahoogroups.com
Subject: [hreg] A holistically different point to look at PV investment.

There is no question that there isnt a financial incentive to install PV right now in Houston.

However there is an intangible value to doing the right thing,

If you have the expendable capital, Instead of buying that shiny new BMW. Lets put up \$30k of panels, Install a high efficiency heatpump. Replace our lighting and lighting controls for CFL. Install light tubes for high traffic locations, and increase the efficacy of our insulation. And last but not least install a sexy solar hot water panel.

Then wait on car purchase for some of the new truely electric cars coming out.

YMMV

Mac

From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of Bill or Dorothy Swann
Sent: Monday, August 03, 2009 9:19 AM
To: hreg@yahoogroups.com
Subject: Re: [hreg] A different way to look at PV investment...

Here is the electric vehicle math. My small EV consumes 200 watt hours per mile. With 1.5 kWatt of panels, you can harvest 2376 kWatt-hr per year or 6.5 kWatt-hr per day. 6500/200 = 32 miles per day.
The source of energy harvested per year is <http://rredc.nrel.gov/solar/codes_algs/PVWATTS/version1/US/> Choose Texas, click on Houston, and enter the data. I have used tracking solar arrays.

Thanks,Bill S
Ph 832-338-3080
www.promotingevs.com

From: Russell Warren <rrwarren@...>
To: hreg@yahoogroups.com
Sent: Monday, August 3, 2009 7:53:18 AM
Subject: RE: [hreg] A different way to look at PV investment...

I think this is a nice example except for the fact that there is a huge assumption being made in that a 1.5 kW solar system could power an electric vehicle for the same amount of miles as the gas listed in the explanation.

Needless to say I have my doubts that you could run a vehicle on even 20 kWh a day.

-----Original Message-----
From: hreg@yahoogroups. com [mailto:hreg@ yahoogroups. com]On Behalf Of Kevin Conlin
Sent: Sunday, August 02, 2009 5:13 PM
To: hreg@yahoogroups. com
Subject: [hreg] A different way to look at PV investment.. .

Good points all.

At the Solar 2009 conference a few months ago I heard a very interesting
analogy made. The premise was that if you invested in a 1.5 kw PV system and
drove an electric vehicle for the next 30 years, you would essentially have
paid for 30 years worth of fuel with the PV system. I don't remember all the
specific assumptions, but it assumed a useful life of 30 years for the pv.

1.5KW @ \$10,000 x .7 Federal Tax Credit = \$7,000/30 years = \$233/year.
Compared to a 25 mpg vehicle, current gasoline costs would be at least
\$800/year, and aren't likely to decline over 30 years time, but you could
also assume mileage improvements would be par with rising fuel costs.

I know you can take the example apart because of the assumptions and
simplified math, but the point was by investing in pv/ev you were displacing
foreign oil payments and reducing the trade deficit, spending the money
domestically and stimulating a growing industry, reducing CO2 and other
climate changing emissions, encouraging distributed energy on the grid as
well as saving money personally, over \$15,000.

As Kim alluded, the benefits aren't just financial; intangibles such as the
personal pride, enjoyment and fulfillment that come from ownership have
different values to different people.

Kevin Conlin
Heliosolar Design, Inc.
13534 Quetzal Lane
Houston, TX 77083
C: (281) 202-9629
H: (281) 530-7501
F: (281) 530-7501
kevin@heliosolardes ign.com

-----Original Message-----
From: hreg@yahoogroups. com [mailto:hreg@yahoogroups. com] On Behalf Of Garth
& Kim Travis
Sent: Sunday, August 02, 2009 3:40 PM
To: hreg@yahoogroups. com
Subject: Re: [hreg] Cost of solar PV installed.

Greetings,

Why would you factor 100% financing? Even mortgages require at least 5 or 10
percent down. Also, a 25 year term for a mere \$38,500? That is paying less
than \$2,000 a year in capital. Any financial adviser worth their salt would
tell you that is a bit silly, a 15 year period would be pretty maximum. How
many times over do you wish to pay for the system?

If you are going to include all of the joys of ownership, you should also
include the adjustments for the rising cost of electric, and the final value
of the system when it is paid for. Especially since when you pay the grid,
at the end of it all, you have nothing. It is like renting a home vs owning
a home. Initially it costs more to own, but in the long run, it is soooooo
much cheaper.

Bright Blessings,
Kim

Robert Johnston wrote:
>
>
> This doesn't factor in (1) the cost of capital or (2) increased
> property insurance rates.
>
> (1) If you assume 100% financing at mortgage rates of 5.25% for 25
> years, the monthly payment for a \$38,500 system (10kW) would be
> \$230.71. Using Chris' estimated output for a 10kW system of 1000
> kW/mo, that increases the cost to \$0.23/kwh.
>
> (2) I was recently quoted \$10 annually per \$1000 coverage on Texas
> Windstorm (possibly Houston is a bit less; I live in Lake Jackson,
> nearer the coast). Federal flood insurance currently runs me \$2.61 per
> \$1000 coverage. Homeowners insurance costs me \$3.73 per \$1000 of
> coverage. Thus, for all 3 coverages, a total of \$16.34 per \$1000 of
> coverage. Now, I don't know what exactly solar panels and controls add
> compared to the cost of the rest of the house itself, but if we
> conservatively assume that it incrementally increases insurance costs
> only at 75% of the rate of the rest of the house, that is \$12.26 per
> \$1000, or for a \$38,500 installation (assuming we only insure for the
> net cost to us after federal subsidies, not the replacement cost of
> the system), then that is an extra \$472 per year, or \$0.039/kwh. If
> insured at replacement cost, it will be correspondingly higher (I
> suspect you will be required by your insurance company to cover at
> replacement cost since that is what they are promising to do for you,
> and no federal subsidy will help them replace your system after a
> fire, hurricane, etc.). If rates are lower in your area, or you don't
> carry flood coverage, then rates would be somewhat lower.
>
>
> With the cost of financing and the cost of insurance factored in, the
> cost would be approximately \$0.27/kwh for a 10 kW system. Whereas
> \$0.128/kwh is similar to current REP rates, \$0.27/kwh is not.
>
> Robert Johnston
>
> *From:* hreg@yahoogroups. com [mailto:hreg@yahoogroups. com] *On Behalf
> Of *Chris Boyer
> *Sent:* Saturday, August 01, 2009 10:27 PM
> *To:* HREG
> *Subject:* [hreg] Cost of solar PV installed.
>
> Here is a simple calculation showing examples of the current economics
> for Solar PV in Houston. I mentioned this is the HREG meeting last
> Sunday, so here are the numbers. What it shows is the "Price" of
> installing a system of three sizes on a building (the upfront cash
> layout), from 100 kW, to 10 kW and 1 kW; then the Federal Tax Credit
> (which is now a rebate for commercial systems); and the Net cost of
> the solar installation for each size. The next line is typical energy
> production (kWh) that the system would produce over the life of the
> system (25 years warranty). Dividing the Net cost by energy produced
> gives the Cost of electricity with a solar PV system on a building:
> less than 12 cents/kWh for larger systems and nearly 15 cents/kWh for
> very small systems.
>
> Size
>
>
>
> 100 kW
>
>
>
> 10 kW
>
>
>
> 1 kW
>
> Price
>
>
>
> \$500,000.00
>
>
>
> \$55,000.00
>
>
>
> \$6,500.00
>
> Fed
>
>
>
> \$150,000.00
>
>
>
> \$16,500.00
>
>
>
> \$1,950.00
>
> Net
>
>
>
> \$350,000.00
>
>
>
> \$38,500.00
>
>
>
> \$4,550.00
>
> Production
>
>
>
>
>
> kWh/25yr
>
>
>
> 3,000,000
>
>
>
> 300,000
>
>
>
> 30,000
>
> Electricity
>
>
>
>
>
> Cost
>
>
>
> \$ 0.117
>
>
>
> \$ 0.128
>
>
>
> \$ 0.152
>
>
>
>

------------ --------- --------- ------

No virus found in this incoming message.
Checked by AVG - www.avg.com
Version: 8.5.392 / Virus Database: 270.13.41/2277 - Release Date: 08/02/09
05:56:00

• Hello Jay and Otto: I agree with you both - we need both, residential PV on rooftops and large utility scale solar such as concentrated solar thermal (CSP) or
Message 23 of 29 , Aug 3, 2009

Hello Jay and Otto:

I agree with you both – we need both, residential PV on rooftops and large utility scale solar such as concentrated solar thermal (CSP) or combined CSP and PV – CPV.

As to incentives, I say use them and ask Congress for more!  I don’t care how the government gets the money to pay for them.   Solar technology needs a leg up to gain access to the market and be fully deployed.  As I’ve said before – solar battles a deeply entrenched energy infrastructure with a 100 year market lead.  If you think of bringing new technology to market – those are impossible odds for an emergent technology.   On top of that, conventional energy enjoys a 100 year history of incentives including today!  Fossil fuels have many more types of incentives than solar, types not available to solar projects.  So use the incentives.  It is a way of compensating for the external costs not borne by conventional energy providers.

External costs not paid by the consumer of conventional energy include police costs – ie- use of military in wars over resources, pollution costs and costs of climate change just to name a few.

Best,

Tyra

From: hreg@yahoogroups.com [mailto: hreg@yahoogroups.com ] On Behalf Of jay.ring@...
Sent: Monday, August 03, 2009 9:00 AM
To: hreg@yahoogroups.com
Subject: [hreg] Re: A different way to look at PV investment... cost vs. value

Hey Otto,

You know I really agree with your vision. CSP is a fantastic technology for powering the grid. Combined with electric cars, it's a nearly complete energy solution.

I also agree with the dangers of the subsidy. I think that is a great point and many people overlook it. (Although if it must exist I am not above taking advantage of it). I would hope people interested in sustainability would see the dangers of the unsustainable subsidy.

But I still think residential PV has a real place in out energy future, despite the higher cost of PV and even though CSP could do it alone if necessary. My reasoning is simple: Residential roof tops are "dead space". There is near-zero ecological impact from putting PV up there.

In my vision for the future, PV handles maybe 25% of the load, CSP handles the remainder and provides the energy storage.

Have a good one!

--- In hreg@yahoogroups. com, "Otto Glaser" <oglaser@... > wrote:

>
> There are a few things that are not being considered. The US Government
has to borrow the money to give the owner of a PV system the tax credit. Based on past history, the government will borrow this money forever. The government will be paying interest on this money long after the PV system is gone.If a large number of people installed a PV system where would the government get the money to pay the tax credit? The cost of a back up system to supply electricity when the sun is not shining. The local utility is required to supply electricity when ever needed, so they would have to build generating plants to cover the demand when the sun was not shining. What source of power would they use to generate electricity? Coal or nuclear? Having the extra capacity that was little used would substantially increase the cost of electricity from the utility. Guess who would pay for that. The tax credit would mostly go to higher income people as poor people would not have enough income to use the tax credit. What that does is take money from poor people and give it to rich people. The poor would have to pay those higher rates. It is more expensive to install PV on each house than to install a Solar Power Tower central system. I was told that a PV system costs about \$8 per watt to install. A central system costs about \$1.00 per watt. If Rice University gets there nano tech wire perfected it would eliminate enough line loss to enable us to shut down 30% of our present generating capacity. I believe that when we get to mass producing Solar Power Tower electric generating plants, the cost will come down enough that it will be the cheapest form of generation. Presently, a SPT plant costs 1/2 as much to build as a nuclear plant-has no fuel cost and is much cheaper to operate.
> Otto Glaser
> 12111 Medina Bend Lane
> Houston ,
w:st="on">TX 77041-6694
> Phone and Fax 713-896-9935
> Email oglaser@...
>
> ----- Original Message -----
> From: Robert Johnston
> To: hreg@yahoogroups. com
> Sent: Sunday, August 02, 2009 7:43 PM
> Subject: RE: [hreg] A different way to look at PV investment.. . cost
vs. value
>
>
>
> Yes, but you are pointing to the intangibles. How many people purchase PV
because it is fun or sexy or anything like that? A few enthusiasts do. But most people are interested simply in getting electrical power; they don't care how. As for the environment, climate change, etc.-remember that this is all available "on the grid" through renewable sources (windpower etc.). So it isn't a choice between PV and climate change etc. The question is whether distributed power in the form of residential PV is cost competitive with renewable power distributed over the grid. The answer, I believe the analysis shows (if you factor in cost of capital), is "no". Again, that doesn't mean folks who get a thrill watching electrons chase holes in their PV panels won't enjoy having them.
>
>
> Robert
>
>
>
>
>
> From: hreg@yahoogroups. com
[mailto:hreg@yahoogroups. com] On Behalf Of Kevin Conlin
> Sent: Sunday, August 02, 2009 7:12 PM
> To: hreg@yahoogroups. com
> Subject: [hreg] A different way to look at PV investment.. . cost vs.
value
>
>
>
>
>
> Yes, I can't argue against a realistic financial perspective, but I also
think that distorts the true value of the investment. We seldom apply those rules to most of the other major purchases in our lives.
>
>
>
> We never think about the return on a set of golf clubs, a beautiful home,
a sleek car or a granite countertop, but those investments make for a more fulfilling life, and we personally justify the extra expense by the satisfaction and enjoyment we get from using those items. How many people reading this bought their car because it was the cheapest and most economical one you could find? It more likely came down to personal choice and preference.
>
>
>
> If climate change, dwindling resources, environmental degradation,
threatened wildlife, future generations, a sustainable society and lifestyle or any other issues are close to your heart, then you can make the right decision without regard for ROI, payback, cost of opportunity, etc...and feel real good about it.
>
>
>
> How many people use life cycle costing when buying a big screen TV, a
stainless steel refrigerator, BBQ grill or new furniture? Then why do we always insist on imposing those rules on solar?
>
>
>
> If we only made decisions based on economics, this would be one empty,
desolate planet....and we would do many things for the very wrong reasons.
>
>
>
> Value is so much more than just cost.....and I admire the people who make
the right decisions for the "wrong" reasons.
>
>
>
>
>
>
>
> Kevin Conlin
>
> Heliosolar Design, Inc.
>
> 13534 Quetzal Lane
>
> Houston ,
w:st="on">TX 77083
>
> C: (281) 202-9629
>
> H: (281) 530-7501
>
> F: (281) 530-7501
>
> kevin@...
>
>
>
>
>
>
>
>
>
>
> ------------ --------- --------- --------- --------- --------- -
>
> From: hreg@yahoogroups. com
[mailto:hreg@yahoogroups. com] On Behalf Of Robert Johnston
> Sent: Sunday, August 02, 2009 5:40 PM
> To: hreg@yahoogroups. com
> Subject: RE: [hreg] A different way to look at PV investment.. .
>
>
>
> I see you posted while I was composing my last post. Just a quick comment.
>
> Your last paragraph is the key one-for some people, the intangibles make
it worth it. That's fine, so long as the true financial cost isn't obscured. Using the example of an electric vehicle just creates a mental image of something green and neat-free transportation fuel! But from a financial perspective, one would want to do the comparison on the basis of the cost of metered electricity from the grid vs. the cost of electricity from PV-regardless of whether it is used for an electric car or for anything else you wanted it for. In that case, the calculation must still factor in cost of capital etc. as I argued. i.e., regardless of the use, one should just make the calculation on the basis of cost per kwh.
>
> Robert
>
> From: hreg@yahoogroups. com
[mailto:hreg@yahoogroups. com] On Behalf Of Kevin Conlin
> Sent: Sunday, August 02, 2009 5:13 PM
> To: hreg@yahoogroups. com
> Subject: [hreg] A different way to look at PV investment.. .
>
>
>
> Good points all.
>
> At the Solar 2009 conference a few months ago I heard a very interesting
> analogy made. The premise was that if you invested in a 1.5 kw PV system
and
> drove an electric vehicle for the next 30 years, you would essentially
have
> paid for 30 years worth of fuel with the PV system. I don't remember all
the
> specific assumptions, but it assumed a useful life of 30 years for the pv.
>
> 1.5KW @ \$10,000 x .7 Federal Tax Credit = \$7,000/30 years = \$233/year.
> Compared to a 25 mpg vehicle, current gasoline costs would be at least
> \$800/year, and aren't likely to decline over 30 years time, but you could
> also assume mileage improvements would be par with rising fuel costs.
>
> I know you can take the example apart because of the assumptions and
> simplified math, but the point was by investing in pv/ev you were
displacing
> foreign oil payments and reducing the trade deficit, spending the money
> domestically and stimulating a growing industry, reducing CO2 and other
> climate changing emissions, encouraging distributed energy on the grid as
> well as saving money personally, over \$15,000.
>
> As Kim alluded, the benefits aren't just financial; intangibles such as
the
> personal pride, enjoyment and fulfillment that come from ownership have
> different values to different people.
>
> Kevin Conlin
> Heliosolar Design, Inc.
> 13534 Quetzal Lane
> Houston ,
w:st="on">TX 77083
> C: (281) 202-9629
> H: (281) 530-7501
> F: (281) 530-7501
> kevin@...
>
>
>
> -----Original Message-----
> From: hreg@yahoogroups. com
[mailto:hreg@yahoogroups. com] On Behalf Of Garth
> & Kim Travis
> Sent: Sunday, August 02, 2009 3:40 PM
> To: hreg@yahoogroups. com
> Subject: Re: [hreg] Cost of solar PV installed.
>
> Greetings,
>
> Why would you factor 100% financing? Even mortgages require at least 5 or
10
> percent down. Also, a 25 year term for a mere \$38,500? That is paying less
> than \$2,000 a year in capital. Any financial adviser worth their salt
would
> tell you that is a bit silly, a 15 year period would be pretty maximum.
How
> many times over do you wish to pay for the system?
>
> If you are going to include all of the joys of ownership, you should also
> include the adjustments for the rising cost of electric, and the final
value
> of the system when it is paid for. Especially since when you pay the grid,
> at the end of it all, you have nothing. It is like renting a home vs
owning
> a home. Initially it costs more to own, but in the long run, it is soooooo
> much cheaper.
>
> Bright Blessings,
> Kim
>
> Robert Johnston wrote:
> >
> >
> > This doesn't factor in (1) the cost of capital or (2) increased
> > property insurance rates.
> >
> > (1) If you assume 100% financing at mortgage rates of 5.25% for 25
> > years, the monthly payment for a \$38,500 system (10kW) would be
> > \$230.71. Using Chris' estimated output for a 10kW system of 1000
> > kW/mo, that increases the cost to \$0.23/kwh.
> >
> > (2) I was recently quoted \$10 annually per \$1000 coverage on
w:st="on">Texas
> > Windstorm (possibly Houston is a bit
less; I live in Lake Jackson ,
> > nearer the coast). Federal flood insurance currently runs me \$2.61
per
> > \$1000 coverage. Homeowners insurance costs me \$3.73 per \$1000 of
> > coverage. Thus, for all 3 coverages, a total of \$16.34 per \$1000 of
> > coverage. Now, I don't know what exactly solar panels and controls
> > compared to the cost of the rest of the house itself, but if we
> > conservatively assume that it incrementally increases insurance costs
> > only at 75% of the rate of the rest of the house, that is \$12.26 per
> > \$1000, or for a \$38,500 installation (assuming we only insure for the
> > net cost to us after federal subsidies, not the replacement cost of
> > the system), then that is an extra \$472 per year, or \$0.039/kwh. If
> > insured at replacement cost, it will be correspondingly higher (I
> > suspect you will be required by your insurance company to cover at
> > replacement cost since that is what they are promising to do for you,
> > and no federal subsidy will help them replace your system after a
> > fire, hurricane, etc.). If rates are lower in your area, or you don't
> > carry flood coverage, then rates would be somewhat lower.
> >
> >
> > With the cost of financing and the cost of insurance factored in, the
> > cost would be approximately \$0.27/kwh for a 10 kW system. Whereas
> > \$0.128/kwh is similar to current REP rates, \$0.27/kwh is not.
> >
> > Robert Johnston
> >
> > *From:* hreg@yahoogroups. com
[mailto:hreg@yahoogroups. com] *On Behalf
> > Of *Chris Boyer
> > *Sent:* Saturday, August 01, 2009 10:27 PM
> > *To:* HREG
> > *Subject:* [hreg] Cost of solar PV installed.
> >
> > Here is a simple calculation showing examples of the current
economics
> > for Solar PV in Houston .
I mentioned this is the HREG meeting last
> > Sunday, so here are the numbers. What it shows is the
"Price" of
> > installing a system of three sizes on a building (the upfront cash
> > layout), from 100 kW, to 10 kW and 1 kW; then the Federal Tax Credit
> > (which is now a rebate for commercial systems); and the Net cost of
> > the solar installation for each size. The next line is typical energy
> > production (kWh) that the system would produce over the life of the
> > system (25 years warranty). Dividing the Net cost by energy produced
> > gives the Cost of electricity with a solar PV system on a building:
> > less than 12 cents/kWh for larger systems and nearly 15 cents/kWh for
> > very small systems.
> >
> > Size
> >
> >
> >
> > 100 kW
> >
> >
> >
> > 10 kW
> >
> >
> >
> > 1 kW
> >
> > Price
> >
> >
> >
> > \$500,000.00
> >
> >
> >
> > \$55,000.00
> >
> >
> >
> > \$6,500.00
> >
> > Fed
> >
> >
> >
> > \$150,000.00
> >
> >
> >
> > \$16,500.00
> >
> >
> >
> > \$1,950.00
> >
> > Net
> >
> >
> >
> > \$350,000.00
> >
> >
> >
> > \$38,500.00
> >
> >
> >
> > \$4,550.00
> >
> > Production
> >
> >
> >
> >
> >
> > kWh/25yr
> >
> >
> >
> > 3,000,000
> >
> >
> >
> > 300,000
> >
> >
> >
> > 30,000
> >
> > Electricity
> >
> >
> >
> >
> >
> > Cost
> >
> >
> >
> > \$ 0.117
> >
> >
> >
> > \$ 0.128
> >
> >
> >
> > \$ 0.152
> >
> >
> >
> >
>
> ------------ --------- --------- ------
>
>
> No virus found in this incoming message.
> Checked by AVG - www.avg.com
> Version: 8.5.392 / Virus Database: 270.13.41/2277 - Release Date: 08/02/09
> 05:56:00
>
> No virus found in this incoming message.
> Checked by AVG - www.avg.com
> Version: 8.5.392 / Virus Database: 270.13.41/2277 - Release Date: 08/02/09
05:56:00
>

• agreed. *except from a composter, the need for oil for fertilizer is a negative. jerry b. pearland ________________________________ From: Gary Beck
Message 24 of 29 , Aug 3, 2009
agreed.
*except from a composter, the need for "oil for fertilizer" is a negative.

jerry b.
pearland

From: Gary Beck <eco@...>
To: hreg@yahoogroups.com
Sent: Monday, August 3, 2009 2:03:55 PM
Subject: RE: [hreg] A holistically different point to look at PV investment.

Great approach.  Once you have enough solar PVs on your roof, and an electric car, you've turned the corner towards grid and oil based fuel* independency.

Gary

* still need oil for fertilizer, plastics, and adhesives

From: hreg@yahoogroups. com [mailto:hreg@ yahoogroups. com] On Behalf Of James McKethen
Sent: Monday, August 03, 2009 10:44 AM
To: hreg@yahoogroups. com
Subject: [hreg] A holistically different point to look at PV investment.

There is no question that there isnt a financial incentive to install PV right now in Houston.

However there is an intangible value to doing the right thing,

If you have the expendable capital, Instead of buying that shiny new BMW. Lets put up \$30k of panels, Install a high efficiency heatpump. Replace our lighting and lighting controls for CFL. Install light tubes for high traffic locations, and increase the efficacy of our insulation. And last but not least install a sexy solar hot water panel.

Then wait on car purchase for some of the new truely electric cars coming out.

YMMV

Mac

From: hreg@yahoogroups. com [mailto:hreg@ yahoogroups. com] On Behalf Of Bill or Dorothy Swann
Sent: Monday, August 03, 2009 9:19 AM
To: hreg@yahoogroups. com
Subject: Re: [hreg] A different way to look at PV investment.. .

Here is the electric vehicle math. My small EV consumes 200 watt hours per mile. With 1.5 kWatt of panels, you can harvest 2376 kWatt-hr per year or 6.5 kWatt-hr per day. 6500/200 = 32 miles per day.
The source of energy harvested per year is <http://rredc. nrel.gov/ solar/codes_ algs/PVWATTS/ version1/ US/> Choose Texas, click on Houston, and enter the data. I have used tracking solar arrays.

Thanks,Bill S
Ph 832-338-3080
www.promotingevs. com

To: hreg@yahoogroups. com
Sent: Monday, August 3, 2009 7:53:18 AM
Subject: RE: [hreg] A different way to look at PV investment.. .

I think this is a nice example except for the fact that there is a huge assumption being made in that a 1.5 kW solar system could power an electric vehicle for the same amount of miles as the gas listed in the explanation.

Needless to say I have my doubts that you could run a vehicle on even 20 kWh a day.

-----Original Message-----
From: hreg@yahoogroups. com [mailto:hreg@ yahoogroups. com]On Behalf Of Kevin Conlin
Sent: Sunday, August 02, 2009 5:13 PM
To: hreg@yahoogroups. com
Subject: [hreg] A different way to look at PV investment.. .

Good points all.

At the Solar 2009 conference a few months ago I heard a very interesting
analogy made. The premise was that if you invested in a 1.5 kw PV system and
drove an electric vehicle for the next 30 years, you would essentially have
paid for 30 years worth of fuel with the PV system. I don't remember all the
specific assumptions, but it assumed a useful life of 30 years for the pv.

1.5KW @ \$10,000 x .7 Federal Tax Credit = \$7,000/30 years = \$233/year.
Compared to a 25 mpg vehicle, current gasoline costs would be at least
\$800/year, and aren't likely to decline over 30 years time, but you could
also assume mileage improvements would be par with rising fuel costs.

I know you can take the example apart because of the assumptions and
simplified math, but the point was by investing in pv/ev you were displacing
foreign oil payments and reducing the trade deficit, spending the money
domestically and stimulating a growing industry, reducing CO2 and other
climate changing emissions, encouraging distributed energy on the grid as
well as saving money personally, over \$15,000.

As Kim alluded, the benefits aren't just financial; intangibles such as the
personal pride, enjoyment and fulfillment that come from ownership have
different values to different people.

Kevin Conlin
Heliosolar Design, Inc.
13534 Quetzal Lane
Houston, TX 77083
C: (281) 202-9629
H: (281) 530-7501
F: (281) 530-7501
kevin@heliosolardes ign.com

-----Original Message-----
From: hreg@yahoogroups. com [mailto:hreg@yahoogroups. com] On Behalf Of Garth
& Kim Travis
Sent: Sunday, August 02, 2009 3:40 PM
To: hreg@yahoogroups. com
Subject: Re: [hreg] Cost of solar PV installed.

Greetings,

Why would you factor 100% financing? Even mortgages require at least 5 or 10
percent down. Also, a 25 year term for a mere \$38,500? That is paying less
than \$2,000 a year in capital. Any financial adviser worth their salt would
tell you that is a bit silly, a 15 year period would be pretty maximum. How
many times over do you wish to pay for the system?

If you are going to include all of the joys of ownership, you should also
include the adjustments for the rising cost of electric, and the final value
of the system when it is paid for. Especially since when you pay the grid,
at the end of it all, you have nothing. It is like renting a home vs owning
a home. Initially it costs more to own, but in the long run, it is soooooo
much cheaper.

Bright Blessings,
Kim

Robert Johnston wrote:
>
>
> This doesn't factor in (1) the cost of capital or (2) increased
> property insurance rates.
>
> (1) If you assume 100% financing at mortgage rates of 5.25% for 25
> years, the monthly payment for a \$38,500 system (10kW) would be
> \$230.71. Using Chris' estimated output for a 10kW system of 1000
> kW/mo, that increases the cost to \$0.23/kwh.
>
> (2) I was recently quoted \$10 annually per \$1000 coverage on Texas
> Windstorm (possibly Houston is a bit less; I live in Lake Jackson,
> nearer the coast). Federal flood insurance currently runs me \$2.61 per
> \$1000 coverage. Homeowners insurance costs me \$3.73 per \$1000 of
> coverage. Thus, for all 3 coverages, a total of \$16.34 per \$1000 of
> coverage. Now, I don't know what exactly solar panels and controls add
> compared to the cost of the rest of the house itself, but if we
> conservatively assume that it incrementally increases insurance costs
> only at 75% of the rate of the rest of the house, that is \$12.26 per
> \$1000, or for a \$38,500 installation (assuming we only insure for the
> net cost to us after federal subsidies, not the replacement cost of
> the system), then that is an extra \$472 per year, or \$0.039/kwh. If
> insured at replacement cost, it will be correspondingly higher (I
> suspect you will be required by your insurance company to cover at
> replacement cost since that is what they are promising to do for you,
> and no federal subsidy will help them replace your system after a
> fire, hurricane, etc.). If rates are lower in your area, or you don't
> carry flood coverage, then rates would be somewhat lower.
>
>
> With the cost of financing and the cost of insurance factored in, the
> cost would be approximately \$0.27/kwh for a 10 kW system. Whereas
> \$0.128/kwh is similar to current REP rates, \$0.27/kwh is not.
>
> Robert Johnston
>
> *From:* hreg@yahoogroups. com [mailto:hreg@yahoogroups. com] *On Behalf
> Of *Chris Boyer
> *Sent:* Saturday, August 01, 2009 10:27 PM
> *To:* HREG
> *Subject:* [hreg] Cost of solar PV installed.
>
> Here is a simple calculation showing examples of the current economics
> for Solar PV in Houston. I mentioned this is the HREG meeting last
> Sunday, so here are the numbers. What it shows is the "Price" of
> installing a system of three sizes on a building (the upfront cash
> layout), from 100 kW, to 10 kW and 1 kW; then the Federal Tax Credit
> (which is now a rebate for commercial systems); and the Net cost of
> the solar installation for each size. The next line is typical energy
> production (kWh) that the system would produce over the life of the
> system (25 years warranty). Dividing the Net cost by energy produced
> gives the Cost of electricity with a solar PV system on a building:
> less than 12 cents/kWh for larger systems and nearly 15 cents/kWh for
> very small systems.
>
> Size
>
>
>
> 100 kW
>
>
>
> 10 kW
>
>
>
> 1 kW
>
> Price
>
>
>
> \$500,000.00
>
>
>
> \$55,000.00
>
>
>
> \$6,500.00
>
> Fed
>
>
>
> \$150,000.00
>
>
>
> \$16,500.00
>
>
>
> \$1,950.00
>
> Net
>
>
>
> \$350,000.00
>
>
>
> \$38,500.00
>
>
>
> \$4,550.00
>
> Production
>
>
>
>
>
> kWh/25yr
>
>
>
> 3,000,000
>
>
>
> 300,000
>
>
>
> 30,000
>
> Electricity
>
>
>
>
>
> Cost
>
>
>
> \$ 0.117
>
>
>
> \$ 0.128
>
>
>
> \$ 0.152
>
>
>
>

------------ --------- --------- ------

No virus found in this incoming message.
Checked by AVG - www.avg.com
Version: 8.5.392 / Virus Database: 270.13.41/2277 - Release Date: 08/02/09
05:56:00

• Great plan, James! That is exactly what they are doing in Europe right now - lots of new homes are built totally without AC/Heating systems by using PV, air
Message 25 of 29 , Aug 3, 2009

Great plan, James!  That is exactly what they are doing in Europe right now – lots of new homes are built totally without AC/Heating systems by using PV, air envelopes, heat pumps and the other things you mention.  But in many European countries, they get incentives too!  It makes things happen much faster.

In Texas we are stubbornly tied to the “free market” mantra, forgetting that with respect to energy, it is an illusion preventing us adopting these technologies and making change.

Best,

Tyra

From: hreg@yahoogroups.com [mailto: hreg@yahoogroups.com ] On Behalf Of James McKethen
Sent: Monday, August 03, 2009 10:44 AM
To: hreg@yahoogroups.com
Subject: [hreg] A holistically different point to look at PV investment.

There is no question that there isnt a financial incentive to install PV right now in Houston .

However there is an intangible value to doing the right thing,

If you have the expendable capital, Instead of buying that shiny new BMW. Lets put up \$30k of panels, Install a high efficiency heatpump. Replace our lighting and lighting controls for CFL. Install light tubes for high traffic locations, and increase the efficacy of our insulation. And last but not least install a sexy solar hot water panel.

Then wait on car purchase for some of the new truely electric cars coming out.

YMMV

Mac

From: hreg@yahoogroups. com [mailto: hreg@ yahoogroups. com ] On Behalf Of Bill or Dorothy Swann
Sent: Monday, August 03, 2009 9:19 AM
To: hreg@yahoogroups. com
Subject: Re: [hreg] A different way to look at PV investment.. .

Here is the electric vehicle math. My small EV consumes 200 watt hours per mile. With 1.5 kWatt of panels, you can harvest 2376 kWatt-hr per year or 6.5 kWatt-hr per day. 6500/200 = 32 miles per day.
The source of energy harvested per year is <http://rredc. nrel.gov/ solar/codes_ algs/PVWATTS/ version1/ US/> Choose Texas , click on Houston , and enter the data. I have used tracking solar arrays.

Thanks,Bill S
Ph 832-338-3080
www.promotingevs. com

To: hreg@yahoogroups. com
Sent: Monday, August 3, 2009 7:53:18 AM
Subject: RE: [hreg] A different way to look at PV investment.. .

I think this is a nice example except for the fact that there is a huge assumption being made in that a 1.5 kW solar system could power an electric vehicle for the same amount of miles as the gas listed in the explanation.

Needless to say I have my doubts that you could run a vehicle on even 20 kWh a day.

-----Original Message-----
From: hreg@yahoogroups. com [mailto:hreg@ yahoogroups. com]On Behalf Of Kevin Conlin
Sent: Sunday, August 02, 2009 5:13 PM
To: hreg@yahoogroups. com
Subject: [hreg] A different way to look at PV investment.. .

Good points all.

At the Solar 2009 conference a few months ago I heard a very interesting
analogy made. The premise was that if you invested in a 1.5 kw PV system and
drove an electric vehicle for the next 30 years, you would essentially have
paid for 30 years worth of fuel with the PV system. I don't remember all the
specific assumptions, but it assumed a useful life of 30 years for the pv.

1.5KW @ \$10,000 x .7 Federal Tax Credit = \$7,000/30 years = \$233/year.
Compared to a 25 mpg vehicle, current gasoline costs would be at least
\$800/year, and aren't likely to decline over 30 years time, but you could
also assume mileage improvements would be par with rising fuel costs.

I know you can take the example apart because of the assumptions and
simplified math, but the point was by investing in pv/ev you were displacing
foreign oil payments and reducing the trade deficit, spending the money
domestically and stimulating a growing industry, reducing CO2 and other
climate changing emissions, encouraging distributed energy on the grid as
well as saving money personally, over \$15,000.

As Kim alluded, the benefits aren't just financial; intangibles such as the
personal pride, enjoyment and fulfillment that come from ownership have
different values to different people.

Kevin Conlin
Heliosolar Design, Inc.
13534 Quetzal Lane
Houston , TX 77083
C: (281) 202-9629
H: (281) 530-7501
F: (281) 530-7501
kevin@heliosolardes ign.com

-----Original Message-----
From: hreg@yahoogroups. com [mailto:hreg@yahoogroups. com] On Behalf Of Garth
& Kim Travis
Sent: Sunday, August 02, 2009 3:40 PM
To: hreg@yahoogroups. com
Subject: Re: [hreg] Cost of solar PV installed.

Greetings,

Why would you factor 100% financing? Even mortgages require at least 5 or 10
percent down. Also, a 25 year term for a mere \$38,500? That is paying less
than \$2,000 a year in capital. Any financial adviser worth their salt would
tell you that is a bit silly, a 15 year period would be pretty maximum. How
many times over do you wish to pay for the system?

If you are going to include all of the joys of ownership, you should also
include the adjustments for the rising cost of electric, and the final value
of the system when it is paid for. Especially since when you pay the grid,
at the end of it all, you have nothing. It is like renting a home vs owning
a home. Initially it costs more to own, but in the long run, it is soooooo
much cheaper.

Bright Blessings,
Kim

Robert Johnston wrote:
>
>
> This doesn't factor in (1) the cost of capital or (2) increased
> property insurance rates.
>
> (1) If you assume 100% financing at mortgage rates of 5.25% for 25
> years, the monthly payment for a \$38,500 system (10kW) would be
> \$230.71. Using Chris' estimated output for a 10kW system of 1000
> kW/mo, that increases the cost to \$0.23/kwh.
>
> (2) I was recently quoted \$10 annually per \$1000 coverage on Texas
> Windstorm (possibly Houston is a bit less; I live in Lake Jackson ,
> nearer the coast). Federal flood insurance currently runs me \$2.61 per
> \$1000 coverage. Homeowners insurance costs me \$3.73 per \$1000 of
> coverage. Thus, for all 3 coverages, a total of \$16.34 per \$1000 of
> coverage. Now, I don't know what exactly solar panels and controls add
> compared to the cost of the rest of the house itself, but if we
> conservatively assume that it incrementally increases insurance costs
> only at 75% of the rate of the rest of the house, that is \$12.26 per
> \$1000, or for a \$38,500 installation (assuming we only insure for the
> net cost to us after federal subsidies, not the replacement cost of
> the system), then that is an extra \$472 per year, or \$0.039/kwh. If
> insured at replacement cost, it will be correspondingly higher (I
> suspect you will be required by your insurance company to cover at
> replacement cost since that is what they are promising to do for you,
> and no federal subsidy will help them replace your system after a
> fire, hurricane, etc.). If rates are lower in your area, or you don't
> carry flood coverage, then rates would be somewhat lower.
>
>
> With the cost of financing and the cost of insurance factored in, the
> cost would be approximately \$0.27/kwh for a 10 kW system. Whereas
> \$0.128/kwh is similar to current REP rates, \$0.27/kwh is not.
>
> Robert Johnston
>
> *From:* hreg@yahoogroups. com [mailto:hreg@yahoogroups. com] *On Behalf
> Of *Chris Boyer
> *Sent:* Saturday, August 01, 2009 10:27 PM
> *To:* HREG
> *Subject:* [hreg] Cost of solar PV installed.
>
> Here is a simple calculation showing examples of the current economics
> for Solar PV in Houston . I mentioned this is the HREG meeting last
> Sunday, so here are the numbers. What it shows is the "Price" of
> installing a system of three sizes on a building (the upfront cash
> layout), from 100 kW, to 10 kW and 1 kW; then the Federal Tax Credit
> (which is now a rebate for commercial systems); and the Net cost of
> the solar installation for each size. The next line is typical energy
> production (kWh) that the system would produce over the life of the
> system (25 years warranty). Dividing the Net cost by energy produced
> gives the Cost of electricity with a solar PV system on a building:
> less than 12 cents/kWh for larger systems and nearly 15 cents/kWh for
> very small systems.
>
> Size
>
>
>
> 100 kW
>
>
>
> 10 kW
>
>
>
> 1 kW
>
> Price
>
>
>
> \$500,000.00
>
>
>
> \$55,000.00
>
>
>
> \$6,500.00
>
> Fed
>
>
>
> \$150,000.00
>
>
>
> \$16,500.00
>
>
>
> \$1,950.00
>
> Net
>
>
>
> \$350,000.00
>
>
>
> \$38,500.00
>
>
>
> \$4,550.00
>
> Production
>
>
>
>
>
> kWh/25yr
>
>
>
> 3,000,000
>
>
>
> 300,000
>
>
>
> 30,000
>
> Electricity
>
>
>
>
>
> Cost
>
>
>
> \$ 0.117
>
>
>
> \$ 0.128
>
>
>
> \$ 0.152
>
>
>
>

------------ --------- --------- ------

No virus found in this incoming message.
Checked by AVG - www.avg.com
Version: 8.5.392 / Virus Database: 270.13.41/2277 - Release Date: 08/02/09
05:56:00

• Very well said, Kevin. Tyra _____ From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of Kevin Conlin Sent: Sunday, August 02, 2009 7:12 PM To:
Message 26 of 29 , Aug 3, 2009

Very well said, Kevin.

Tyra

From: hreg@yahoogroups.com [mailto: hreg@yahoogroups.com ] On Behalf Of Kevin Conlin
Sent: Sunday, August 02, 2009 7:12 PM
To: hreg@yahoogroups.com
Subject: [hreg] A different way to look at PV investment... cost vs. value

Yes, I can't argue against a realistic financial perspective, but I also think that distorts the true value of the investment.  We seldom apply those rules to most of the other major purchases in our lives.

We never think about the return on a set of golf clubs, a beautiful home, a sleek car or a granite countertop, but those investments make for a more fulfilling life, and we personally justify the extra expense by the satisfaction and enjoyment we get from using those items. How many people reading this bought their car because it was the cheapest and most economical one you could find?  It more likely came down to personal choice and preference.

If climate change, dwindling resources, environmental degradation, threatened wildlife, future generations, a sustainable society and lifestyle or any other issues are close to your heart, then you can make the right decision without regard for ROI, payback, cost of opportunity, etc...and feel real good about it.

How many people use life cycle costing when buying a big screen TV, a stainless steel refrigerator, BBQ grill or new furniture?  Then why do we always insist on imposing those rules on solar?

If we only made decisions based on economics, this would be one empty, desolate planet....and we would do many things for the very wrong reasons.

Value is so much more than just cost.....and I admire the people who make the right decisions for the "wrong" reasons.

Kevin Conlin

Heliosolar Design, Inc.

13534 Quetzal Lane

Houston, TX 77083

C:  (281) 202-9629

H:  (281) 530-7501

F:  (281) 530-7501

kevin@heliosolardes ign.com

From: hreg@yahoogroups. com [mailto: hreg@ yahoogroups. com ] On Behalf Of Robert Johnston
Sent: Sunday, August 02, 2009 5:40 PM
To: hreg@yahoogroups. com
Subject: RE: [hreg] A different way to look at PV investment.. .

I see you posted while I was composing my last post.  Just a quick comment…

Your last paragraph is the key one—for some people, the intangibles make it worth it.  That’s fine, so long as the true financial cost isn’t obscured.  Using the example of an electric vehicle just creates a mental image of something green and neat—free transportation fuel!  But from a financial perspective, one would want to do the comparison on the basis of the cost of metered electricity from the grid vs. the cost of electricity from PV—regardless of whether it is used for an electric car or for anything else you wanted it for.  In that case, the calculation must still factor in cost of capital etc. as I argued.  i.e., regardless of the use, one should just make the calculation on the basis of cost per kwh.

Robert

From: hreg@yahoogroups. com [mailto: hreg@ yahoogroups. com ] On Behalf Of Kevin Conlin
Sent: Sunday, August 02, 2009 5:13 PM
To: hreg@yahoogroups. com
Subject: [hreg] A different way to look at PV investment.. .

Good points all.

At the Solar 2009 conference a few months ago I heard a very interesting
analogy made. The premise was that if you invested in a 1.5 kw PV system and
drove an electric vehicle for the next 30 years, you would essentially have
paid for 30 years worth of fuel with the PV system. I don't remember all the
specific assumptions, but it assumed a useful life of 30 years for the pv.

1.5KW @ \$10,000 x .7 Federal Tax Credit = \$7,000/30 years = \$233/year.
Compared to a 25 mpg vehicle, current gasoline costs would be at least
\$800/year, and aren't likely to decline over 30 years time, but you could
also assume mileage improvements would be par with rising fuel costs.

I know you can take the example apart because of the assumptions and
simplified math, but the point was by investing in pv/ev you were displacing
foreign oil payments and reducing the trade deficit, spending the money
domestically and stimulating a growing industry, reducing CO2 and other
climate changing emissions, encouraging distributed energy on the grid as
well as saving money personally, over \$15,000.

As Kim alluded, the benefits aren't just financial; intangibles such as the
personal pride, enjoyment and fulfillment that come from ownership have
different values to different people.

Kevin Conlin
Heliosolar Design, Inc.
13534 Quetzal Lane
Houston , TX 77083
C: (281) 202-9629
H: (281) 530-7501
F: (281) 530-7501
kevin@heliosolardes ign.com

-----Original Message-----
From: hreg@yahoogroups. com [mailto:hreg@yahoogroups. com] On Behalf Of Garth
& Kim Travis
Sent: Sunday, August 02, 2009 3:40 PM
To: hreg@yahoogroups. com
Subject: Re: [hreg] Cost of solar PV installed.

Greetings,

Why would you factor 100% financing? Even mortgages require at least 5 or 10
percent down. Also, a 25 year term for a mere \$38,500? That is paying less
than \$2,000 a year in capital. Any financial adviser worth their salt would
tell you that is a bit silly, a 15 year period would be pretty maximum. How
many times over do you wish to pay for the system?

If you are going to include all of the joys of ownership, you should also
include the adjustments for the rising cost of electric, and the final value
of the system when it is paid for. Especially since when you pay the grid,
at the end of it all, you have nothing. It is like renting a home vs owning
a home. Initially it costs more to own, but in the long run, it is soooooo
much cheaper.

Bright Blessings,
Kim

Robert Johnston wrote:

>
>
> This doesn't factor in (1) the cost of capital or (2) increased
> property insurance rates.
>
> (1) If you assume 100% financing at mortgage rates of 5.25% for 25
> years, the monthly payment for a \$38,500 system (10kW) would be
> \$230.71. Using Chris' estimated output for a 10kW system of 1000
> kW/mo, that increases the cost to \$0.23/kwh.
>
> (2) I was recently quoted \$10 annually per \$1000 coverage on
w:st="on">Texas
> Windstorm (possibly Houston is a bit less;
I live in Lake Jackson ,
> nearer the coast). Federal flood insurance currently runs me \$2.61 per
> \$1000 coverage. Homeowners insurance costs me \$3.73 per \$1000 of
> coverage. Thus, for all 3 coverages, a total of \$16.34 per \$1000 of
> coverage. Now, I don't know what exactly solar panels and controls add
> compared to the cost of the rest of the house itself, but if we
> conservatively assume that it incrementally increases insurance costs
> only at 75% of the rate of the rest of the house, that is \$12.26 per
> \$1000, or for a \$38,500 installation (assuming we only insure for the
> net cost to us after federal subsidies, not the replacement cost of
> the system), then that is an extra \$472 per year, or \$0.039/kwh. If
> insured at replacement cost, it will be correspondingly higher (I
> suspect you will be required by your insurance company to cover at
> replacement cost since that is what they are promising to do for you,
> and no federal subsidy will help them replace your system after a
> fire, hurricane, etc.). If rates are lower in your area, or you don't
> carry flood coverage, then rates would be somewhat lower.
>
>
> With the cost of financing and the cost of insurance factored in, the
> cost would be approximately \$0.27/kwh for a 10 kW system. Whereas
> \$0.128/kwh is similar to current REP rates, \$0.27/kwh is not.
>
> Robert Johnston
>
> *From:* hreg@yahoogroups. com
[mailto:hreg@yahoogroups. com] *On Behalf
> Of *Chris Boyer
> *Sent:* Saturday, August 01, 2009 10:27 PM
> *To:* HREG
> *Subject:* [hreg] Cost of solar PV installed.
>
> Here is a simple calculation showing examples of the current economics
> for Solar PV in Houston .
I mentioned this is the HREG meeting last
> Sunday, so here are the numbers. What it shows is the "Price" of
> installing a system of three sizes on a building (the upfront cash
> layout), from 100 kW, to 10 kW and 1 kW; then the Federal Tax Credit
> (which is now a rebate for commercial systems); and the Net cost of
> the solar installation for each size. The next line is typical energy
> production (kWh) that the system would produce over the life of the
> system (25 years warranty). Dividing the Net cost by energy produced
> gives the Cost of electricity with a solar PV system on a building:
> less than 12 cents/kWh for larger systems and nearly 15 cents/kWh for
> very small systems.
>
> Size
>
>
>
> 100 kW
>
>
>
> 10 kW
>
>
>
> 1 kW
>
> Price
>
>
>
> \$500,000.00
>
>
>
> \$55,000.00
>
>
>
> \$6,500.00
>
> Fed
>
>
>
> \$150,000.00
>
>
>
> \$16,500.00
>
>
>
> \$1,950.00
>
> Net
>
>
>
> \$350,000.00
>
>
>
> \$38,500.00
>
>
>
> \$4,550.00
>
> Production
>
>
>
>
>
> kWh/25yr
>
>
>
> 3,000,000
>
>
>
> 300,000
>
>
>
> 30,000
>
> Electricity
>
>
>
>
>
> Cost
>
>
>
> \$ 0.117
>
>
>
> \$ 0.128
>
>
>
> \$ 0.152
>
>
>
>

------------ --------- --------- ------

No virus found in this incoming message.
Checked by AVG - www.avg.com
Version: 8.5.392 / Virus Database: 270.13.41/2277 - Release Date: 08/02/09
05:56:00

No virus found in this incoming message.
Checked by AVG - www.avg.com
Version: 8.5.392 / Virus Database: 270.13.41/2277 - Release Date: 08/02/09 05:56:00

• Robert, Yes I am talking about the intangibles, but it s the intangibles in our lives that make and define us, not tangible assets. It s not the car, the bank
Message 27 of 29 , Aug 3, 2009
Robert, Yes I am talking about the intangibles, but it's the intangibles in our lives that make and define us, not tangible assets.  It's not the car, the bank account or the house..

The most important decisions in our lives are about intangibles; love of friends and family, our social conscience, our life partner, our religion, our fear of death,  belief in an afterlife, how we conduct our daily lives.........the things that make us happy and fulfilled.

My point is you unfairly discount the very things that mean the most to us because they don't have a \$ sign.

Silas Marner was not a happy camper.

I promise this is my last post on this topic......

Kevin Conlin
Heliosolar Design, Inc.
13534 Quetzal Lane
Houston, TX 77083
C:  (281) 202-9629
H:  (281) 530-7501
F:  (281) 530-7501

From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com] On Behalf Of Robert Johnston
Sent: Sunday, August 02, 2009 7:44 PM
To: hreg@yahoogroups.com
Subject: RE: [hreg] A different way to look at PV investment... cost vs. value

Yes, but you are pointing to the intangibles.  How many people purchase PV because it is fun or sexy or anything like that?  A few enthusiasts do.  But most people are interested simply in getting electrical power; they don’t care how.  As for the environment, climate change, etc.—remember that this is all available “on the grid” through renewable sources (windpower etc.).  So it isn’t a choice between PV and climate change etc.  The question is whether distributed power in the form of residential PV is cost competitive with renewable power distributed over the grid.  The answer, I believe the analysis shows (if you factor in cost of capital), is “no”.  Again, that doesn’t mean folks who get a thrill watching electrons chase holes in their PV panels won’t enjoy having them.

Robert

From: hreg@yahoogroups. com [mailto:hreg@ yahoogroups. com] On Behalf Of Kevin Conlin
Sent: Sunday, August 02, 2009 7:12 PM
To: hreg@yahoogroups. com
Subject: [hreg] A different way to look at PV investment.. . cost vs. value

Yes, I can't argue against a realistic financial perspective, but I also think that distorts the true value of the investment.  We seldom apply those rules to most of the other major purchases in our lives.

We never think about the return on a set of golf clubs, a beautiful home, a sleek car or a granite countertop, but those investments make for a more fulfilling life, and we personally justify the extra expense by the satisfaction and enjoyment we get from using those items. How many people reading this bought their car because it was the cheapest and most economical one you could find?  It more likely came down to personal choice and preference.

If climate change, dwindling resources, environmental degradation, threatened wildlife, future generations, a sustainable society and lifestyle or any other issues are close to your heart, then you can make the right decision without regard for ROI, payback, cost of opportunity, etc...and feel real good about it.

How many people use life cycle costing when buying a big screen TV, a stainless steel refrigerator, BBQ grill or new furniture?  Then why do we always insist on imposing those rules on solar?

If we only made decisions based on economics, this would be one empty, desolate planet....and we would do many things for the very wrong reasons.

Value is so much more than just cost.....and I admire the people who make the right decisions for the "wrong" reasons.

Kevin Conlin

Heliosolar Design, Inc.

13534 Quetzal Lane

Houston, TX 77083

C:  (281) 202-9629

H:  (281) 530-7501

F:  (281) 530-7501

kevin@heliosolardes ign.com

From: hreg@yahoogroups. com [mailto:hreg@ yahoogroups. com] On Behalf Of Robert Johnston
Sent: Sunday, August 02, 2009 5:40 PM
To: hreg@yahoogroups. com
Subject: RE: [hreg] A different way to look at PV investment.. .

I see you posted while I was composing my last post.  Just a quick comment…

Your last paragraph is the key one—for some people, the intangibles make it worth it.  That’s fine, so long as the true financial cost isn’t obscured.  Using the example of an electric vehicle just creates a mental image of something green and neat—free transportation fuel!  But from a financial perspective, one would want to do the comparison on the basis of the cost of metered electricity from the grid vs. the cost of electricity from PV—regardless of whether it is used for an electric car or for anything else you wanted it for.  In that case, the calculation must still factor in cost of capital etc. as I argued.  i.e., regardless of the use, one should just make the calculation on the basis of cost per kwh.

Robert

From: hreg@yahoogroups. com [mailto:hreg@ yahoogroups. com] On Behalf Of Kevin Conlin
Sent: Sunday, August 02, 2009 5:13 PM
To: hreg@yahoogroups. com
Subject: [hreg] A different way to look at PV investment.. .

Good points all.

At the Solar 2009 conference a few months ago I heard a very interesting
analogy made. The premise was that if you invested in a 1.5 kw PV system and
drove an electric vehicle for the next 30 years, you would essentially have
paid for 30 years worth of fuel with the PV system. I don't remember all the
specific assumptions, but it assumed a useful life of 30 years for the pv.

1.5KW @ \$10,000 x .7 Federal Tax Credit = \$7,000/30 years = \$233/year.
Compared to a 25 mpg vehicle, current gasoline costs would be at least
\$800/year, and aren't likely to decline over 30 years time, but you could
also assume mileage improvements would be par with rising fuel costs.

I know you can take the example apart because of the assumptions and
simplified math, but the point was by investing in pv/ev you were displacing
foreign oil payments and reducing the trade deficit, spending the money
domestically and stimulating a growing industry, reducing CO2 and other
climate changing emissions, encouraging distributed energy on the grid as
well as saving money personally, over \$15,000.

As Kim alluded, the benefits aren't just financial; intangibles such as the
personal pride, enjoyment and fulfillment that come from ownership have
different values to different people.

Kevin Conlin
Heliosolar Design, Inc.
13534 Quetzal Lane
Houston, TX 77083
C: (281) 202-9629
H: (281) 530-7501
F: (281) 530-7501
kevin@heliosolardes ign.com

-----Original Message-----
From: hreg@yahoogroups. com [mailto:hreg@yahoogroups. com] On Behalf Of Garth
& Kim Travis
Sent: Sunday, August 02, 2009 3:40 PM
To: hreg@yahoogroups. com
Subject: Re: [hreg] Cost of solar PV installed.

Greetings,

Why would you factor 100% financing? Even mortgages require at least 5 or 10
percent down. Also, a 25 year term for a mere \$38,500? That is paying less
than \$2,000 a year in capital. Any financial adviser worth their salt would
tell you that is a bit silly, a 15 year period would be pretty maximum. How
many times over do you wish to pay for the system?

If you are going to include all of the joys of ownership, you should also
include the adjustments for the rising cost of electric, and the final value
of the system when it is paid for. Especially since when you pay the grid,
at the end of it all, you have nothing. It is like renting a home vs owning
a home. Initially it costs more to own, but in the long run, it is soooooo
much cheaper.

Bright Blessings,
Kim

Robert Johnston wrote:

>
>
> This
doesn't factor in (1) the cost of capital or (2) increased
> property
insurance rates.
>
> (1) If you assume 100% financing at mortgage
rates of 5.25% for 25
> years, the monthly payment for a \$38,500 system
(10kW) would be
> \$230.71. Using Chris' estimated output for a 10kW
system of 1000
> kW/mo, that increases the cost to
\$0.23/kwh.
>
> (2) I was recently quoted \$10 annually per \$1000
coverage on Texas
> Windstorm (possibly Houston is a bit less; I live in
Lake Jackson,
> nearer the coast). Federal flood insurance currently runs
me \$2.61 per
> \$1000 coverage. Homeowners insurance costs me \$3.73 per
\$1000 of
> coverage. Thus, for all 3 coverages, a total of \$16.34 per
\$1000 of
> coverage. Now, I don't know what exactly solar panels and
> compared to the cost of the rest of the house itself, but
if we
> conservatively assume that it incrementally increases insurance
costs
> only at 75% of the rate of the rest of the house, that is \$12.26
per
> \$1000, or for a \$38,500 installation (assuming we only insure for
the
> net cost to us after federal subsidies, not the replacement cost of
> the system), then that is an extra \$472 per year, or \$0.039/kwh. If
> insured at replacement cost, it will be correspondingly higher (I
> suspect you will be required by your insurance company to cover at
> replacement cost since that is what they are promising to do for you,
> and no federal subsidy will help them replace your system after a
> fire, hurricane, etc.). If rates are lower in your area, or you don't
> carry flood coverage, then rates would be somewhat
lower.
>
>
> With the cost of financing and the cost of
insurance factored in, the
> cost would be approximately \$0.27/kwh for a
10 kW system. Whereas
> \$0.128/kwh is similar to current REP rates,
\$0.27/kwh is not.
>
> Robert Johnston
>
> *From:*
href="mailto:hreg%40yahoogroups.com">hreg@yahoogroups. com [mailto:hreg@yahoogroups. com] *On Behalf
> Of *Chris Boyer
> *Sent:* Saturday, August 01, 2009 10:27
PM
> *To:* HREG
> *Subject:* [hreg] Cost of solar PV
installed.
>
> Here is a simple calculation showing examples of the
current economics
> for Solar PV in Houston. I mentioned this is the HREG
meeting last
> Sunday, so here are the numbers. What it shows is the
"Price" of
> installing a system of three sizes on a building (the
upfront cash
> layout), from 100 kW, to 10 kW and 1 kW; then the Federal
Tax Credit
> (which is now a rebate for commercial systems); and the Net
cost of
> the solar installation for each size. The next line is typical
energy
> production (kWh) that the system would produce over the life of
the
> system (25 years warranty). Dividing the Net cost by energy
produced
> gives the Cost of electricity with a solar PV system on a
building:
> less than 12 cents/kWh for larger systems and nearly 15
cents/kWh for
> very small systems.
>
> Size
>
>
>
> 100 kW
>
>
>
> 10 kW
>
>
>
> 1 kW
>
> Price
>
>
>
>
\$500,000.00
>
>
>
> \$55,000.00
>
>
>
> \$6,500.00
>
> Fed
>
>
>
>
\$150,000.00
>
>
>
> \$16,500.00
>
>
>
> \$1,950.00
>
> Net
>
>
>
>
\$350,000.00
>
>
>
> \$38,500.00
>
>
>
> \$4,550.00
>
> Production
>
>
>
>
>
> kWh/25yr
>
>
>
>
3,000,000
>
>
>
> 300,000
>
>
>
> 30,000
>
> Electricity
>
>
>
>
>
> Cost
>
>
>
> \$
0.117
>
>
>
> \$ 0.128
>
>
>
>
\$ 0.152
>
>
>
>

------------ --------- --------- ------

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• Greetings, Once again, urban vs rural and this list does serve surrounding areas. In the rural areas, you pay to get hooked up to the grid, depending on how
Message 28 of 29 , Aug 3, 2009
Greetings,

Once again, urban vs rural and this list does serve surrounding areas.
In the rural areas, you pay to get hooked up to the grid, depending on
how far they need to run the lines, it can be thousands.

I use the words 'home ownership' to mean actually owning a home. Not in
the process of buying one, which is what having a mortgage is. When I
teach finances, I point out how many times over you are going to pay for
that house if you run your mortgage out, at least 3 or 4 times. Home
ownership is great if you pay the place off ASAP, then life's little
disasters aren't so bad to live with. Many people don't understand that
they are renting when they opt for a mortgage of the type that just pays
the interest. They will never own the place. And yes, buying at the
top of the market hurts, you can wind up owing more than the house is worth.

But with all things, the costs depend on circumstances. I know many
people that are off grid since it was cheaper than having the grid
connected. I use PV in my out buildings for the same reason, it is
cheaper.

system with costs equal to renewable energy purchased on the grid with
the full support of professionalcrews/maintenance included." Are
funny. I wish the grid was that dependable. We purchased our first
large inverter [powered by our tractor running on waste veggie oil] to
be able to power the freezers and fridges when the grid is down.
Renewable energy grid is not an option here.

Self Sufficiency will cut costs of everything, if you are willing to do
the work. Maybe this is why some of us find PV affordable and others do not.

Bright Blessings,
Kim

Robert Johnston wrote:
> Kim, you've raised some interesting points. I'll try to address each below.
>
>
>
>
>
• Thanks Bill, That is less than I would have assumed they use. Russ ... From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com]On Behalf Of Bill or Dorothy
Message 29 of 29 , Aug 3, 2009
Thanks Bill,
That is less than I would have assumed they use.

Russ

-----Original Message-----
From: hreg@yahoogroups.com [mailto:hreg@yahoogroups.com]On Behalf Of Bill or Dorothy Swann
Sent: Monday, August 03, 2009 9:19 AM
To: hreg@yahoogroups.com
Subject: Re: [hreg] A different way to look at PV investment...

Here is the electric vehicle math. My small EV consumes 200 watt hours per mile. With 1.5 kWatt of panels, you can harvest 2376 kWatt-hr per year or 6.5 kWatt-hr per day. 6500/200 = 32 miles per day.
The source of energy harvested per year is <http://rredc. nrel.gov/ solar/codes_ algs/PVWATTS/ version1/ US/> Choose Texas, click on Houston, and enter the data. I have used tracking solar arrays.

Thanks,Bill S
Ph 832-338-3080
www.promotingevs. com

To: hreg@yahoogroups. com
Sent: Monday, August 3, 2009 7:53:18 AM
Subject: RE: [hreg] A different way to look at PV investment.. .

I think this is a nice example except for the fact that there is a huge assumption being made in that a 1.5 kW solar system could power an electric vehicle for the same amount of miles as the gas listed in the explanation.
Needless to say I have my doubts that you could run a vehicle on even 20 kWh a day.

-----Original Message-----
From: hreg@yahoogroups. com [mailto:hreg@ yahoogroups. com]On Behalf Of Kevin Conlin
Sent: Sunday, August 02, 2009 5:13 PM
To: hreg@yahoogroups. com
Subject: [hreg] A different way to look at PV investment.. .

Good points all.

At the Solar 2009 conference a few months ago I heard a very interesting
analogy made. The premise was that if you invested in a 1.5 kw PV system and
drove an electric vehicle for the next 30 years, you would essentially have
paid for 30 years worth of fuel with the PV system. I don't remember all the
specific assumptions, but it assumed a useful life of 30 years for the pv.

1.5KW @ \$10,000 x .7 Federal Tax Credit = \$7,000/30 years = \$233/year.
Compared to a 25 mpg vehicle, current gasoline costs would be at least
\$800/year, and aren't likely to decline over 30 years time, but you could
also assume mileage improvements would be par with rising fuel costs.

I know you can take the example apart because of the assumptions and
simplified math, but the point was by investing in pv/ev you were displacing
foreign oil payments and reducing the trade deficit, spending the money
domestically and stimulating a growing industry, reducing CO2 and other
climate changing emissions, encouraging distributed energy on the grid as
well as saving money personally, over \$15,000.

As Kim alluded, the benefits aren't just financial; intangibles such as the
personal pride, enjoyment and fulfillment that come from ownership have
different values to different people.

Kevin Conlin
Heliosolar Design, Inc.
13534 Quetzal Lane
Houston, TX 77083
C: (281) 202-9629
H: (281) 530-7501
F: (281) 530-7501
kevin@heliosolardes ign.com

-----Original Message-----
From: hreg@yahoogroups. com [mailto:hreg@yahoogroups. com] On Behalf Of Garth
& Kim Travis
Sent: Sunday, August 02, 2009 3:40 PM
To: hreg@yahoogroups. com
Subject: Re: [hreg] Cost of solar PV installed.

Greetings,

Why would you factor 100% financing? Even mortgages require at least 5 or 10
percent down. Also, a 25 year term for a mere \$38,500? That is paying less
than \$2,000 a year in capital. Any financial adviser worth their salt would
tell you that is a bit silly, a 15 year period would be pretty maximum. How
many times over do you wish to pay for the system?

If you are going to include all of the joys of ownership, you should also
include the adjustments for the rising cost of electric, and the final value
of the system when it is paid for. Especially since when you pay the grid,
at the end of it all, you have nothing. It is like renting a home vs owning
a home. Initially it costs more to own, but in the long run, it is soooooo
much cheaper.

Bright Blessings,
Kim

Robert Johnston wrote:
>
>
> This doesn't factor in (1) the cost of capital or (2) increased
> property insurance rates.
>
> (1) If you assume 100% financing at mortgage rates of 5.25% for 25
> years, the monthly payment for a \$38,500 system (10kW) would be
> \$230.71. Using Chris' estimated output for a 10kW system of 1000
> kW/mo, that increases the cost to \$0.23/kwh.
>
> (2) I was recently quoted \$10 annually per \$1000 coverage on Texas
> Windstorm (possibly Houston is a bit less; I live in Lake Jackson,
> nearer the coast). Federal flood insurance currently runs me \$2.61 per
> \$1000 coverage. Homeowners insurance costs me \$3.73 per \$1000 of
> coverage. Thus, for all 3 coverages, a total of \$16.34 per \$1000 of
> coverage. Now, I don't know what exactly solar panels and controls add
> compared to the cost of the rest of the house itself, but if we
> conservatively assume that it incrementally increases insurance costs
> only at 75% of the rate of the rest of the house, that is \$12.26 per
> \$1000, or for a \$38,500 installation (assuming we only insure for the
> net cost to us after federal subsidies, not the replacement cost of
> the system), then that is an extra \$472 per year, or \$0.039/kwh. If
> insured at replacement cost, it will be correspondingly higher (I
> suspect you will be required by your insurance company to cover at
> replacement cost since that is what they are promising to do for you,
> and no federal subsidy will help them replace your system after a
> fire, hurricane, etc.). If rates are lower in your area, or you don't
> carry flood coverage, then rates would be somewhat lower.
>
>
> With the cost of financing and the cost of insurance factored in, the
> cost would be approximately \$0.27/kwh for a 10 kW system. Whereas
> \$0.128/kwh is similar to current REP rates, \$0.27/kwh is not.
>
> Robert Johnston
>
> *From:* hreg@yahoogroups. com [mailto:hreg@yahoogroups. com] *On Behalf
> Of *Chris Boyer
> *Sent:* Saturday, August 01, 2009 10:27 PM
> *To:* HREG
> *Subject:* [hreg] Cost of solar PV installed.
>
> Here is a simple calculation showing examples of the current economics
> for Solar PV in Houston. I mentioned this is the HREG meeting last
> Sunday, so here are the numbers. What it shows is the "Price" of
> installing a system of three sizes on a building (the upfront cash
> layout), from 100 kW, to 10 kW and 1 kW; then the Federal Tax Credit
> (which is now a rebate for commercial systems); and the Net cost of
> the solar installation for each size. The next line is typical energy
> production (kWh) that the system would produce over the life of the
> system (25 years warranty). Dividing the Net cost by energy produced
> gives the Cost of electricity with a solar PV system on a building:
> less than 12 cents/kWh for larger systems and nearly 15 cents/kWh for
> very small systems.
>
> Size
>
>
>
> 100 kW
>
>
>
> 10 kW
>
>
>
> 1 kW
>
> Price
>
>
>
> \$500,000.00
>
>
>
> \$55,000.00
>
>
>
> \$6,500.00
>
> Fed
>
>
>
> \$150,000.00
>
>
>
> \$16,500.00
>
>
>
> \$1,950.00
>
> Net
>
>
>
> \$350,000.00
>
>
>
> \$38,500.00
>
>
>
> \$4,550.00
>
> Production
>
>
>
>
>
> kWh/25yr
>
>
>
> 3,000,000
>
>
>
> 300,000
>
>
>
> 30,000
>
> Electricity
>
>
>
>
>
> Cost
>
>
>
> \$ 0.117
>
>
>
> \$ 0.128
>
>
>
> \$ 0.152
>
>
>
>

------------ --------- --------- ------