Tuesday, March 13, 2012
A Personal Journey Down the Clean Energy Road, Part 2: Selecting a Solar Energy System
by Peter Gorr
In a previous piece, I wrote on how the economy and the environment are inseparable and how developing a new clean energy based economy is a huge economic development opportunity. I feel an obligation that if I’m going to “talk the talk”; I need to “walk the walk”. To that end, I have recently completed a project to transition one small slice of the world -- my home -- to new clean energy. I was hopeful that the anticipated benefits will actually be realized.
As someone deeply concerned about the environment, but more importantly, a parent and grandparent, my motivation for transitioning my home to solar generated electricity is that it is the right thing to do. I believed that I would need to spend a lot to do this and perhaps never see a breakeven point. But I couldn’t place a price on my children’s future. Yes, I was also feeling guilty. As an American I am among the worst CO2 emitters on the planet. My children already face the prospect of a massive clean up and a difficult adaptation to climate change. This is now a certainty. The only question is how much. In fact, I’m surprised young people are not more vocal and actively in the streets and in the voting booths over this burden they face.
So I solicited bids for a Solar Photovoltaic (PV) system. Basically, solar options consist of solar panels (PV) that will generate electricity and thermal solar panels for heating water. I just went with a PV system. A great 4 minute video primer on solar can be viewed at http://www.teachersdomain.org/resource/oer09.sci.ess.watcyc.solarhome/.
As with any home improvement project, it is recommended that you take the basic precautions of selecting your contractor carefully and thoroughly educating yourself before signing on the dotted line. Thankfully there are several reputable and experienced firms available these days. So the criteria I used in selecting the supplier were the following:
1. The system should be properly designed to fit my site and to maximize benefits to me.
2. All equipment should be from a reputable manufacturer and must qualify as “Manufactured in USA”.
3. I should be given plenty of hand-holding throughout the project including details of the process required for interconnections, permitting, and renewable energy credit generation and sale.
4. The supplier should have the adequate experience and good references.
5. The pricing should be competitive (though it need not be the lowest).
While I feel every contractor I accepted bids from could have done the job and done it well, only one company fit all my criteria. This was a very important indication to me that they listened to and understood all my concerns and that they wanted to supply me with what I wanted rather than with what they wanted. This is Sales 101 but so often such a rare experience.
Here is a description of my system. Before I called in the first contractor, I read up on solar systems and the basic building blocks of such a system as well as took a class. They are not terribly complex but there are some different options to consider. I’m not going to cover this in detail. Simply put, the system consists of collectors (there are different options here both is size and design), inverters (collectors generate DC electricity that needs to be converted to AC, again a couple options to consider), mounting hardware, wiring and conduits. I also added a communications gateway so that I could see the output of my system via an ethernet connection to my PC and to a website for remote monitoring and analysis. All in all it is pretty basic. The big decision is how many panels and where to locate them on your home or property.
I’m fortunate to have a home that is well suited for solar. The back faces straight south, there is little shading, and there is enough roof space to accommodate my needs (see picture). Occasionally you hear complaints about the aesthetics of a solar system. Judge for yourself. I think it looks good and better than 2 or 3 satellite TV dishes hanging on the house.
My system consists of twenty eight 240 watt panels with micro inverters (one inverter per panel rather than one inverter for the entire array). So, total output is 6.72 kilowatts. This is a pretty good size system for a home. But my home is some 4,000 square feet and I have been averaging about 900 kilowatt hours per month. The system should deliver about 80% of my current demand. I under-sized the system for 2 reasons. First, I believe I can continue to reduce my electricity consumption through efficiency measures and second, and this is unfortunate, net metering rules will not compensate me for electricity I produce in excess of what I use. What is net metering? In simplest terms, when I generate electricity and don’t use it I will feed it to the grid and my meter will go backwards. When I call for electricity in excess of what I am producing, like at night, my meter will run forward. I pay the net difference, if there is one, at the end of the month. If I have delivered more than I have used, these credits roll over to the next month. But here is the kicker, at the end of a 12 month period, the rolling over stops and I start from zero again. So I have no incentive to produce more than I will use in a year since this would just mean providing free energy to a utility which will then sell it at full value. All we can do is work to change state legislation which tends to favor the large wealthy producers over the little guy.
Another consideration is obtaining a building permit from the town. Here requirements and costs can vary. In Palatine IL I only require a standard building permit and it cost me $428. The permit required that I submit engineering calculations verifying that my roof will support the weight of the system. An engineering firm was hired to perform this calculation. Cost here was $750. Next Commonwealth Edison required an application for interconnection and net metering. Total cost was $50. My contractor coordinated all of this for me.
So all in all this was not complicated, especially with a contractor who managed the permitting and interconnection details. There was some unnecessary added cost but it was not prohibitive. There is an opportunity to simplify things even further. While the recent Smart Grid legislation included language favorable to renewable energy, it also contained language that was not favorable. So one step forward and one step back which leaves us going nowhere. This is exactly where the fossil fuel people want the clean energy efforts to go. We should feel proud to live in a state that was pretty progressive regarding renewable energy but be disappointed that new efforts are stalled. Currently Illinois has received a grade of B from an independent study of current state policies regarding net metering and interconnections. We know what we need to do to get an A grade in both these categories1. This would make our state a more attractive place in which to live and do business.
Finally I should be eligible to sell RECs (Renewable Energy Credits). This was something I didn’t know anything about until well into the process and it was a pleasant surprise. For every megawatt hour of energy produced I will own one REC. My system should generate 8 RECs per year. This is a little tricky to explain but a REC is a “certificate” tied to the environmental benefits of a renewable energy system. You might call them the “bragging rights” to clean energy. If someone who is trying to meet renewable energy mandates or goals wants to secure this claim without having a renewable energy system they can buy RECs. While I get the energy and savings, if I sell my RECs I cannot claim the environmental benefits, the purchaser now has that right. But I know these benefits are there and I get all the financial benefits so I’m happy to part with these certificates which may net me in the neighborhood of $125 each.
In the next piece that I will write, I will concentrate on the economics of my system. But keep in mind the benefits I am generating in addition to my personal financial gains. First, I have created a good size job for a local contractor. Second, I am purchasing equipment all of which is manufactured in the USA. This is generating domestic job growth. Third, my energy dollars are staying in this country. Fourth, since my “fuel” is free and not controlled by any company or country I do not face inflationary or fluctuating energy costs or the threat of having this source shut off or held hostage. This is beneficial to national and personal security.
Footnote 1. Freeing the Grid, Best Practices in State Net Metering Policies and Interconnection Procedures, December 2010, Network for New Energy Choices, New York, NY.
About the author: Peter Gorr lives in Palatine, IL and is a husband, parent, and grandparent. He is a retired business executive and holds a MBA from the University of Chicago in Marketing and Statistics. He is on the Executive Committee of the Sierra Club NW Cook County Group and an active member of Illinois Solar Energy Association.