Is it time to go solar? What you should know before you install panels


More often than not, if it’s daytime, the sun is out in Austin. So how do you know if it makes sense to harness the sun’s power and add a solar energy system to your house?

Today in Your Home, we look at what you need to have a solar system, the upfront costs and how long it takes for solar to pay off.

How does solar work?

Solar arrays, made up of solar panels with solar cells inside, sit on your roof and collect light to convert to electricity. That electricity comes in the form of direct current. Wires from the solar panels will bring the electricity to an inverter, which converts the direct current into alternating current (the kind used in your home). If you are generating electricity in panels, your home will use that electricity first. If you’re not generating enough, then your home will pull electricity from your utility’s power grid. If you are generating more than enough electricity, the excess will go back into the power grid. If you’re not hooked up to a grid, you can hook up your system to battery storage, but if that’s the case, you won’t qualify for incentives from Austin Energy.

What happens at night or when it’s cloudy?

You’ll still produce some energy when it’s overcast, just not as much. At night, your home will pull electricity from the grid instead of from the solar panels.

Is every house made for solar?

The number of homes with solar systems is growing in Austin, with 3,745 that have gone through Austin Energy’s incentives program since 2004, including 801 added last year, according to Austin Energy. But only about one in four homes in Austin is ideal for solar, says Danielle Murray, solar manager at the utility. Homes need to have enough roof space that is not shaded by trees, chimneys, other homes or hills. Ideally the roof space is facing south. East and west can work, but a north-facing roof won’t get enough sun to qualify for Austin Energy incentives.

Ideally, you want the solar photovoltaic panels to sit at a 30-degree angle. You can install panels on a flat roof, but you’ll need to add a rack system to get the panels at the correct angle, and you’ll have to get a building permit for the rack.

You also want to have a relatively new roof because you don’t want to have to take off the solar and put it back on a year from now when you need a new roof. Most roof materials work for adding solar on top of them. Some installers are wary of tile roofs because of the fragile nature of the tiles and the difficulty at matching the tile with a replacement tile.

How much does solar cost?

Solar systems have come way down in cost and are now about $3.25 a watt. If you do a 5 kilowatt system, which is the average Austin Energy is seeing installed right now, the cost for the system is $16,250. If you qualify, Austin Energy offers a $1.10 per watt incentive, which would cover $5,500. A federal tax credit, which will expire after 2016, covers 30 percent, or $3,225, of the rest. That means it will cost you $7,525 for a $16,250 system.

If you don’t have Austin Energy, check with your utility to see what incentive program it might have.

Are incentives guaranteed?

Nope. Your property and your project have to qualify for the incentives. First, your roof has to be ideal for solar, with at least six continuous hours a day of sun at the right angle. Your roof also must have at least 10 years of life left, and, if your home is older than 10 years, you have to do an energy audit with Austin Energy and complete the recommendations — usually adding insulation in the attic and installing weather stripping around doors and solar screens on windows. You also have to use one of Austin Energy’s qualified installers — and there are about 40 on the list. Your system also has to use only equipment on the California Energy Commission list, and your system must be hooked up to Austin Energy’s power grid.

Austin Energy sets the incentive rates based on the current cost of the solar panels, expected payback, and the amount of available incentive funding, targeting the level where the incentive will get people over the initial upfront cost barrier. When solar panels were $10-$12 a watt when Austin Energy started incentives in 2004, the incentives were $5 a watt. As panel costs have fallen, so have the incentives. The rate and the incentive money isn’t guaranteed unless you have a signed contract with Austin Energy. Occasionally, the utility has run out of incentive money before the end of the fiscal year.

How can I pay for the system?

There are loans out there that used to be difficult to get, but it is getting easier. Some people also take out a home equity loan, roll it into the mortgage if it’s a new home or use savings.

What about insurance and taxes?

You should check with your homeowners insurance company before you install a system. Because you’re adding $16,250 worth of value to your property, you might be charged more.

On your property taxes, you will not be charged for the added value to your home if you fill out a special form noting that you have solar.

How big of a system do I need?

First you want to look at 12 months of bills to see how many kilowatts you’re using. How big of a system you install depends on how much power you want to generate, how big a system the sunny part of your roof can hold as well as how much you can afford. It takes about 100 square feet of space to produce about 1,000-1,400 kilowatt hours of electricity per year. You don’t want to install more than you will use because you will never recoup the cost of that investment. You also can add on to your system if you can only afford a smaller system at first.

How do I save money on my electric bill?

Austin Energy calculates bills for people with solar this way: First it adds up your total electric usage and applies the usual residential electric charges, including a monthly customer charge, regulatory charges, community benefit charges, power supply adjustment, and tiered energy rates. As you move into higher tiers of electric use, the electricity becomes more expensive. While the first tier (up to 500 kilowatt hours of energy) costs only 1.8 cents per kilowatt hour in the winter and 3.3 cents in the summer, the highest tier (for more than 2,500 kilowatt hours) costs 11.5 cents per kilowatt hour in the summer. It then multiples the amount of solar kilowatt-hours you produced and gives you an 11.3 cent per kilowatt-hour “Value of Solar” credit. If your solar credit is greater than your electric charges, you can roll over that credit to the next month. Even though you’re producing electricity, there’s still an incentive to use less energy so that you’re in a lower tier, which is charged at a lower rate. And of course the more energy efficient your home is, the smaller solar system you need, which will reduce the system cost and improve your payback.

How do I know which installer to use?

First, go with an installer that is part of Austin Energy’s list. They must have completed training and have someone who is certified in solar to do the job. Be wary of the door-to-door salesperson, the person who is selling too small of a system to qualify for incentives (less than 2 kilowatts) or more than you can use, the installer who hasn’t done it very long or who doesn’t install solar as his primary job. Always get multiple bids and ask for references.

Your installer should be handling all the permitting, working with Austin Energy on incentives and securing the equipment.

How do I know which equipment to buy?

Some installers will tell you to be wary of panels from China, but about 95 percent come from China. You just want to make sure the panels are made by a reputable company that has staying power. Solar panels carry a 25-year warranty, so you want to make sure that in the meantime, your panels still have a company that will service them.

You have a choice in panels that use a string inverter and panels that use microinverters. With microinverters, each panel is connected to its own inverter, and if one panel isn’t operational, the other panels will continue to work. A string inverter means all the panels in an array are connected to a larger inverter. If one panel malfunctions or doesn’t have enough sun to work, your other panels might or might not work. Also with a microinverter system, it’s easier to add additional panels, but microinverter systems are more expensive.

How long does it take?

The actual installation is a couple of days, but usually it takes several weeks to a few months to get through the process, which includes getting approval, installation, inspections and getting new meters. A lot of people think about doing it in summer, but realistically, if you want it for summer, you should start now.

What is the maintenance like?

There’s very little. Most systems have an online component to check how much electricity you’re making if you want to monitor it. Occasionally, especially if we have high pollen days with no rain, you’ll need to wash off the panels to make sure you’re making the most electricity.

Panels last about 25 years, but there is a slight loss of productivity with each passing year. They are guaranteed at 25 years to produce at least at 80 percent of what they would do when they were new. About every 10 to 12 years, you will have to replace the inverter.

What about hail?

Panels are designed to be hit with a 1 inch golf ball going about 100 miles an hour. Often, the roof around it is damaged, but the solar panels are fine.

When does my system pay for itself?

That depends on how much electricity you use, how much your investment was and what rate Austin Energy is paying for solar and charging for electricity. Right now it’s about seven to 10 years. Let’s look at three real cases and see how they are doing.

Jaime Guerra and his wife, Oralia, have a 1,050-square-foot home in North Austin. He put in a 24-panel, 6½ kilowatt system last summer. Right now he’s saving about $100 a month on his electric bill but paying $130 a month for a 10-year loan that included the solar as well as the home energy audit, a new dual stage air conditioner and a furnace. So, they are basically paying $30 a month additional for 10 years. Guerra estimates that in about 4½ years, he would have paid back just the solar part of it. And, he adds, they have an electric car they are charging as well as grandkids running in and out of the house.

Frankie Crayton added his 14-panel, 4½ kilowatt system in 2012 to his 2,700-square-foot home in East Austin. He’s been paying $109 a month in a loan and will pay it off next year. He calculated that in the first year, he paid only $700 in electricity. His lowest bill was a $20 credit. His highest bill was $110. Each winter he’s storing credits to pay off the electricity he uses in the summer.

Rich and Theresa Winemiller added 26 panels, roughly a 7 kilowatt system, three years ago on their 1,500-square-foot home in South Austin. They estimate they’ll spend about 4½ years paying it off. Usually June through September they pay for electricity but build up credits the rest of the year. In January, they generated 450 kilowatt hours of electricity and used only 279 kilowatt hours. Last July, they generated 808 kilowatt hours but used 936 kilowatt hours, which meant they spent $118.



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