Commercial solar installations could stall with the expiration of a federal solar grant program

Time is running out for owners of commercial properties!  A federal solar grant program is ending soon – December 31, 2010 to be exact.  That deadline has property owners scrambling to install solar panels now so that they can take advantage of a solar incentive program that allows up to 30% of the cost of solar panel systems.

To be eligible for the grant program before it expires, you must enter into a contract for a solar panel system and pay at least 5% of the cost of the project by December 31, 2010.

Originally adopted as a federal tax credit, the Legislature converted the program into a Treasury grant program so that commercial property owners didn’t have to wait to get the rebate until tax time.  Now, owners can receive a check within 60 days of solar panel installation.

However, despite industry efforts to get Congress to extend the federal solar grant program, it remains set to expire at the end of the year.

The federal solar grant program has been quite successful in stimulating solar installations across the country.

According to the U.S. Partnership for Renewable Energy Finance, investments in solar panel systems doubled from 2008-2010 when the grant program was in place.  Over 1,100 solar energy systems have been financed in part by the federal solar grant program, per statistics of the Solar Energy Industries Association.

A 30% reduction in the out-of-pocket costs for solar power systems is no small matter when it comes to commercial properties.  The size and scale of solar panel systems that can be installed is much greater than without the help of federal funds.  Not only do the grant monies encourage commercial property owners to go solar by minimizing the capital expenditure outlay required at the outset, but owners are also able to recoup investments much more quickly – often within 4 or 5 years.

If Congress does not renew the federal solar grant program by the end of the year, it will revert to an investment tax credit good through 2016.  And commercial investment in solar panel systems is expected to decline dramatically, as a result.

What can you do?  Write, email or call your Congressperson and ask them to extend the federal solar grant program!

Homeowners that install solar panels can enjoy smaller electricity bills and often get credit from their utility by net metering.  That is, if they generate more power than they use, the extra solar electricity is fed back into the grid, allowing other customers the benefit of green power.  On the other hand, during time periods in which the sun is not shining (overnight or during inclement weather), you don’t have to invest in a battery or back-up generator.  You only pay for net consumption of electricity, with a grid-connected solar power system.  Depending on your utility, you may also be billed a nominal fee for the grid connection (less than $5 per month), and local taxes.

Benefits of grid-connected solar power:

1.  Reliable electricity from the ability to draw from the grid when solar panels are not generating much (or any) electricity.

2.  Time of Use pricing (TOU) by utilities generally means you pay more during the daytime when demand is high, and less at night.  With solar panels, however, you won’t need to draw on the most expensive electricity since your panels are generating power during daylight hours.

3.  Utilities can provide more consistent power when homeowners install solar panels because grid demand and congestion during peak hours is lowered.  That also minimizes the risk of blackouts and brownouts.  In short, home solar panel systems that are connected to the grid actually help stabilize the entire system by shaving off peak electricity demand during the day, and then drawing on grid power at night to “fill the valleys.”

According to the Department of Energy’s 2007 report on distributed generation, home solar systems can “[increase] electric system reliability” and “[reduce] peak power requirements.”  In fact, the 2003 Northeast Blackout, which affected an estimated 45 million people in eight U.S. states, could have been prevented if 80,000 more solar homes were powered by solar electricity.

How grid connected solar panel systems work

Going solar is the smart thing to do.  Each day, abundant, free power from the sun literally falls from the sky.  We can harness a fraction of that to reduce our carbon footprint, as well as demand on the grid.  Staying connected to the grid, however, allows use of net metering and reliability when solar resources are low.

Grid-connected solar power is a practical solution to today’s energy dilemmas.

Install solar panels on free-standing structures

Think that rooftop solar panels are your only alternative for home solar installations?  Think again!

For some people, the design of their roof is not appropriate for solar panels.  Other homeowners may face shading from surrounding trees, or a poor roof angle to capture sunlight.  Some residents are choosing home solar panel options to allow them to reduce their reliance on grid-based electricity, while still preserving the integrity of their roof.

For example, in Tacoma, Washington, one couple installed a $25,000 solar panel system, consisting of 12 panels, on the top of a Pergola in their yard.  The system will reduce their utility bill by 50%.  The couple estimates that the system will pay for itself within 10 years, particularly considering the net-metering option allowed by the local utility.

Another Washington state family realized that a non-south-facing roof posed challenges to a rooftop solar panel installation.  So, they built their own structure to hold six solar panels that track the movement of the sun across the sky to maximize energy generation.  For the relatively low cost of $15,000, the family is trimming their utility bill and realizing energy independence.

Solar panels on a free-standing shed

Home solar panel options will continue to increase as residents look for ways to install solar and save money.  Rooftops are just the start!  Look for more free-standing structures holding solar panels to be built in back or side-yards.  Solar panels can also be installed on garages, sheds, playhouses and more.

Have you seen creative home solar panel structures in your hometown?

Crayola's factory in Pennsylvania is now solar powered

Last week, Crayola officially “plugged in” its new 15-acre solar farm at its Forks Township facility in Pennsylvania.  Comprised of 26,200 solar panels, the crayon manufacturer will generate enough clean, renewable power to produce 1/3 of its annual production of 3 billion crayons.

That’s a pretty nice shade of green!

Celebrating the new Crayola solar farm

The $11.5 million project became reality for Crayola with the help of investment from PPL Corp. and Reading-based UGI Energy Services.  Federal stimulus funds off-set about 10% of the cost.

With Crayola going green by installing the solar farm, the company will eliminate 1,900 tons of greenhouse gas emissions each year.  The amount of clean solar electricity that will replace grid-based power generated by coal is equivalent to planting 400 acres of forest, or saving 200,000 gallons of gas annually!

The Crayola solar farm is located behind the factory in the Forks Township.

You can pay less for solar panels!

So many property owners are considering renewable energy options, but are concerned about the upfront costs.  But, did you know you can pay less for solar panels?

Over the past two years, solar panel prices have dropped dramatically – by more than 50%!  Even so, investing in solar can carry a “break-even” time period of 7-15 years.

In order to minimize the initial cost outlay for solar panels, there are a number of options to consider when you start considering going solar.

1.  Maximize local, state and federal tax incentives and rebates.  Government is very supportive of taxpayers’ efforts to go solar.  Even as prices continue to drop, you can effectively slash the cost of solar panels by up to 80% with tax incentives and rebates.  Consider that, for a solar panel system that would normally cost $50,000, you could pay as little as $10,000!

2.  Ask for volume discounts.  Purchasing 10 panels?  Maybe you can pay for 9 and get one for free!  You really do not know, unless you ask.  Solar manufacturers are happy to make a happy customer.  Just think about the number of friends and colleagues that you would refer as additional clients!  (those in the solar panel business…. hint, hint!)

Solar panels can cost you less

3.  Create your own volume discount.  Find other people in your area that would like to install solar panels.  Work together and negotiate a reduced cost for solar panels systems.  You can do this on your own, or work with a company like One Block Off the Grid.

4.  Consider financing options.  Whether you lease solar panels or get a loan from your local government (paid off through property tax increases), you may not have to pay the entire cost for a solar panel system upfront.

Don’t let the cost of solar panels dissuade you from switching to the renewable energy resource!  Even if you are still making a significant investment upfront (after maximizing incentives, rebates and discounts), consider the fact that for every $1 you save on annual energy costs, your property value increases by $20.

Could you save $2,000 a year by installing solar panels (about $150/month)  How would it feel to know that your property value would go up by $40,000?

That’s a pretty great return on investment!

Solar power investment questions answered

What will drive solar power investment in the future?  You may think that a concern for the environment would drive funds toward renewable energy, but actually, its much like any other capital venture:  how to make more money.

In a recent Reuters blog post, Ray Kurzweil, a futurist and inventor, discussed the fact that billions of dollars are currently invested in solar power and that new advances will drive down the cost of solar energy:

“As a result, the amount of solar energy is doubling every year two years.  But ultimately it will be very inexpensive. So what’s motivating (its adoption) is economics.  It has the side effect that it’s environmentally much friendlier.”

That all sounds great to me, as a homeowner and someone concerned about my finances, but how will it actually work?

What kind of solar power investment will you make?

For now, we will have to wait for prices to continue to drop, particularly if we’re making a solar power investment.  The factor to consider before jumping in is the ROI, or “return on investment.”  This is a measure of when the money you put in at the outset will pay you back.

For example:  your solar panel array costs you $20,000, after tax credits and incentives.  Let’s say that you save $1000 a year on your utility bills, and the price of your home increases by $10,000.  What will your ROI be?  In other words, how many years until you break even?  This will vary between 5-10 years, or even less when you consider the fact that you will guard against utility bill increases once you install a solar panel system.

I sincerely wish that solar power investment was more closely related to a long-term consideration of global concerns, rather than short-term thoughts about the market.  But, after all, in today’s economy, many people are more worried about their nest egg, than the health of the planet 40-50 years from now.

Where do you stand when it comes to investment in solar power or other renewable energy?

PV Inverter Meter

If you have a solar panel system on your home and are tied to the grid, you’ll also need a PV inverter meter.  By using a meter, you’ll be able to track power demands, energy generation and also keep on top of any potential issues with your system.

Before we review information you can obtain from a PV inverter meter, we should go over the purpose of a solar inverter.  Basically, an inverter is required to change the direct current (DC) that is generated by your solar panels from the absorbed solar energy into alternating current (AC) that you can use as electricity.

The following video shows a solar inverter installation:

A solar inverter

Now that you know about PV inverters, let’s review the information you can obtain from a small, wall-mounted inverter meter:

1. Energy Produced by your Solar Panels.  Measured in kilowatt-hours (kWh), your meter can give you up-to-date information regarding the energy produced during the past 24 hours.  Some models may be able to report cumulative energy production too.  Consider the estimated annual production of kWh for which your system was designed and divide by 365.  If you are below that number, you may wish to make some adjustments, such as cleaning the panels or making sure that vegetation is not shading them.  Or, you may have a blown fuse.
2. Output Power (AC).  A PV inverter meter can tell you in watts the amount of alternative current (AC) power your solar panel system is producing.
3. Direct Current (DC) Voltage.  This value may change due to outdoor temperatures, as the voltage rises as temperatures drops and vice-versa.  Make sure that the voltage stays within the inverter’s voltage input specifications.
4. Direct Current (DC) Amps.  This value shows the amount of irradiation to which your panels are exposed. Of course, it will be lower on cloudy days.
5. Advanced meter calculations.  Sign me up for one of these fancy devices that can tell you about CO2 offsets that you are achieving by using a solar power system.  Others include an error menu that can pinpoint where problems may be occurring.

How are you using your PV inverter meter?  Can you better maximize your energy production and use by paying closer attention to its functions?