Yes, it gets hot here. Really hot. And even when it’s not blazing hot, it’s more than likely sunny. Really sunny. It only rains about 30 days a year here. So, if you are a weather forecaster, your job is pretty easy. Because we have SO MUCH SUN in Phoenix, it makes sense to consider solar energy. A lot of sense.
Solar is catching on and companies that supply solar panels to homeowners are popping up faster than weeds in March. More and more new home builders are offering solar as an option. It’s a big deal in the Valley of the Sun, so much so that in 2012, Governor Janet Napolitano observed that solar power in Arizona has the potential to make Arizona “the Persian Gulf of solar energy”.
But is solar really all that and more? It sounds great – living “off-the-grid” producing your own glorious, earth-friendly energy, selling the extra to the poor saps that are tethered to SRP and APS. Just plant a garden, start composting and get some chickens, and you are at one with Mother Earth, right?
Just like everything, it’s not always as great as the ads make it out to be. Yes, solar energy is clean. Yes, generating your own power with solar panels can save you money. But there’s a couple of catches. Big ones.
Solar panels are not cheap. A typical set-up can run $30-$40K easy. There are tax incentives to offset some of the cost or you can lease your system. But in the end, you have to factor the cost of the system into the equation.
Leases can often be a liability when selling a home. Buyers have to qualify for the lease in order to transfer the contract at COE and some buyers would rather pass the extra cost on to the seller in the form of a lease buy-out. Furthermore, banks have a hard time quantifying the value of solar panels, so the expense may not translate into the appraised value. And let’s just skip the part for now about doing maintenance on your roof, because, well, you will have MOVE the solar panels first!
Very few people can completely de-couple their home from “the grid” – that mostly happens in the movies, not in real life. More likely you become partners with SRP or APS in the power business. Which means you are going to share their costs for maintaining a solar energy infrastructure through fees. Both APS and SRP have been giving customers with rooftop solar systems a break when it comes the the infrastructure costs as a way to stimulate the adoption of solar power generation among households. As more homes add solar panels, the costs m will be restructuring their fee schedule to ensure that solar customers who purchase less energy as a portion of the household energy is generated from solar panels, will still share a fair and equal portion of the infrastructure fees with their non-solar neighbors. A contract must be signed with the utility company and a grid charge will be added to be added to ensure that the costs for maintaining the SRP grid are fairly distributed. So between the possible lease and a contract with the utility company, there are some obligations that make this less than a spontaneous concept.
At the end of the day, when you add up all the factors, solar can still look very appealing. Very appealing, indeed. But before you pull the trigger on this big commitment, take your time and do it right. The trick is to maximize your savings and realize the biggest ROI you can.
How? Here’s a few ideas…
1. Do an energy audit on your home before you call the solar company. A good audit runs about $99 and can help you make your house more efficient overall so you use less power. Leaky ductwork, gaps in windows and doors, inadequate insulation, poorly vented attic space and other easy fixes can add up to a bigger bill especially when you crank up the AC. SRP and APS work with auditors to give you the information you need about your home to reduce the amount of energy you use. Using less energy is a good idea no matter what and some of these changes are a more cost-effective way to reduce your power bill. Here’s a list of auditors with SRP and APS . Here are a a few tips about energy audits from the BBB
3. Determine whether leasing or buying your system is going to produce the best return on your money. Here’s a handy-dandy calculator to help you out. In a nutshell, it seemed to me that bigger solar systems a more expensive to lease than to buy but it’s best to apply all the factors and crunch the numbers for your particular case.
As solar technology increases, costs for solar will decrease. Utility companies and solar panel providers will become better versed on how to provide solar energy options to thier customers. Arizona is poised to be a leader in residential solar energy. It’s a great trend – just be careful before jumping on the bandwagon.
Want to learn more? Check out:
SRP – Residential solar programs
APS – Overview of their renewable energy program
Solar City – One of the biggest suppliers of solar panels in Arizona
Solar Action Alliance – Resource for the benefits of solar.