Comments on: RoofRay calculates solar savings using Google Maps

Ever thought of putting up solar panels? Check out RoofRay, a tool that helps you do the math.

[Joe Real]

The major factors affecting the economic feasibility of your solar PV system are:
1) total cost of the system after rebates- this is probably the single killer of any residential solar PV project. Because these are often expressed in terms of $/watt, it is more complex to compute and this is where the article could help because it is affected by the area, orientation of the area, the slope of the panels, the average sunshine hours of your locality, the cost of labor, the price of the panels and inverters to name a few. All of these will also affect the amount of your rebates and your tiered rate.

2) The rate of utility increase. The bigger is the rate, the more feasible is the project. This is a major factor and it depends upon your guess about where the utility rates are headed. So far, the average rate of increase (from 1990 prices) of retail rates has been 2.01%/year for the entire US, and not the outlandish 6.7% often quoted by solar PV installers. The data can be downloaded from the US Department of Energy. So far the rate of increase has been stable, some years it is declining, some years it is a big jump, but it is not as dicey as the price of oil. The bottom line is that the rate of increase will not be as dramatic as the solar PV installers would have you believe. This is because, the lower is the rate of increase, the less feasible would be a solar PV project. I have looked at the published rate of increase for California and it is 2.35%/year since 1990.

3) The amortized payment of the system. The APR rate is a big factor. In today's troubled financial times for equity type loans, the rates are often around 7% or more. This APR is a lot bigger than the average rate of increase of electricity rates. If the APR is bigger than the average rate of utility increase, the more you money you lose on residential solar PV project, and the losses keeps on compounding through the years that you won't be able to recover up to the end of the warranted life of the panels..

4) Other variables that need to be considered should include the maintenance upkeep, at least paying someone to hose off the surface of the panels to keep them clean, the replacement cost of the inverter, the insurance premium for the system (the system is expensive, better have it insured).

All of these factors should be considered. Not one of the eight companies that I asked could produce a price that would make sense, and we are in the prime spots of solar radiation interception. No matter what size the system of solar PV, I would end up paying more in terms of amortized payments, insurance, maintenance if I install PV versus no solar PV. At my current tiered level and pattern of use of electricity, the price of solar PV should be less than or equal to $4.60/watt after rebates. The best that I can get from the eight quotes was $6.97/watt after rebates. And at that price, the solar PV project is a financial black hole that you won't be able to recover your expenses. The break even price would be different for each residential home as the rebates vary by state, your pattern of use and other factors. The size and orientation of your roof is only one part that is needed to compute the feasibility.

[Joe Real]

I played with the RoofRay site, very cool tool! Excellent technical information and accurate roof solar radiation calculations. Very nice tool, it agrees well with my calculations if I use the same parameters. It is an excellent tool for calculating the technical side.

The other data that would be excellent to include in the financial calculations would be:
1) Insurance cost. It is a major investment and needs to be insured. Insurance is annual cost or can be paid monthly. You have to protect it against fires, hail, unusual weather disturbances, theft, and vandalism. One simple way to do this is to extend existing home insurance policy to include the solar PV pro-rated at replacement cost. Or simply let the user provide the insurance cost for the solar PV system.

2) Replacement of inverters after every 10-15 years. Most inverters don't last as long as the solar PV.

3) Cost of labor of periodically cleaning the panels to maximize efficiency. The cost of monitoring should also be included. Just call this item maintenance and monitoring cost.

4) Perhaps also add the time based pricing of utility rates as an option. Usually peak demands and highest price are in the afternoon when solar produces the most power.

5) The bottom line of total payments comparison between solar PV and no solar PV that shows the cost of financing. So calculate also the monthly-amortized payments. Allow the user to enter value of APR. Very few people can pay cash for such large investments, and so most residential solar PV projects will be financed. Then everything must be compared. Solar PV that takes into account your reduced electric bills, amortized payment, maintenance cost, insurance cost, amortized cost of replacement inverters AND then compare that to the costs of No Solar PV, just the rate of electricity without the solar PV.

6) But most importantly, what should be the break-even price per watt (after rebates) of solar PV so that
a) at the first year, the total bill payments (remainder electric bills, yearly-amortized payment, annual insurance, and annual maintenance) with solar PV equals that of annual electric bills without solar PV.
b) at 12 years (or halfway through the life of solar PV), the total bill payments with solar PV equal the total bill payments without solar PV
c) at 25 years, the total bill payments with solar PV equal the total bill payments without solar PV.

[tech_crazy]

Good article and equally good couple of posts from Joe Real. However I could not agree with item 6) c) in post 2. From a consumer perspective, if at 25 years, the total bill payments with solar PV were the same as that without, why would the consumer go through the whole hassle of going with the PV in the 1st place? Altrustic/"saving the planet" thinking aside, if the project does not come out financially ahead in the long term, there would be no incentive from the consumer side. So, after a break-even period, however long it is, the PV annual cost should be less than that of traditional electricity. You can think of the "renewable" and clean nature of the electricity as a bonus, not the primary feature of a utility from the consumer perspective.

[Seaspray0]

when compared to the cost of generating power by using other methods that are "green", solar cells are not cost effective. Wind power is by far one of the best but you can't always rely on the wind. If you want a better solar choice, a solar-to-thermal solution gives a much better return on investment. Before you even touch a solar cell, you should be heating your water with solar.

[misc456789]

I live next to a high rise that casts a shadow over part my house for part of the day. The size of the shadow changes throughout the seasons. I'm want to model the impact of the high rises' shadow on my proposed solar installation. And if possible, show which sections of my roof are never shadowed by the high rise.

Does anyone know of a website that can do this?