As a country, we’re hugely dependent on electric power. This is true of most of the industrialized world, but it’s also good to remember that more than one-quarter of the world’s population has no access to electricity.
When we lose power in the North Bay during winter storms, it’s fun for a few hours, but rapidly escalates to a major inconvenience, more so for those who rely on electricity for heat and pumping water. Companies like Google, Amazon and Microsoft, which depend on electric power for massive data centers, are building them next to reliable, abundant and cheap sources of electricity.
About three-quarters of electric power in the United States is generated by burning hydrocarbons (coal, natural gas, oil), with most of the rest coming from nuclear power plants and hydroelectric sources. Sources like wind and solar account for about 3 percent of our nation’s power generation.
One of the big problems with electricity is that there really aren’t any good ways to store it. It’s consumed as it’s generated, and the so-called “grid” is actually pretty complicated, as witnessed when it encounters a spectacular failure like the cascading outage that left most of the Northeast dark in August 2003.
A personal choice
I live in West Sonoma County. My family gets its power courtesy of PG&E. Long ago, we installed a time-of-use meter so we could take advantage of the fact that PG&E charges less for electricity consumed during off-peak hours. Our power goes out maybe twice a year, rarely for more than a few hours.
What made us decide to install solar power—actually, a photovoltaic (PV) panel system—for our home? Aside from a general sense of reducing our impact on the environment, the best reason is that it will (almost) eliminate our monthly electric bill.
Once you decide to install PV panels, the process is surprisingly fast and easy. Once the permit was obtained, installation of our system took two days. Our home was built in 1990, but the roof structure is sturdy and didn’t require any reinforcement. It’s important to be sure an older roof won’t need replacing before installing a panel system.
The completed installation is pretty inconspicuous. We have 36 PV panels manufactured by SunPower (www.sunpowercorp.com), which can generate 6 kilowatts (kW) of electricity at peak sunshine. They’re mounted in a light-but-sturdy metal frame that’s attached to the roof. A metal conduit runs from the panels through my attic and down into a large plastic box mounted on the garage wall. The box contains an inverter, which takes the panels’ direct current (DC) output and converts it to AC power.
For a technology guy like me, the system is actually a little disappointing. I was hoping for a little more gadgetry to play with…or at least look at. When I first started thinking about getting solar for the house a few years back, BP Solar (a division of oil company British Petroleum—who’s hedging their bets?) had advertisements showing cool graphic readouts. Now all I have is something that looks like the display on a pager. And at night, it doesn’t show anything at all—no sun, no electricity.
The big plastic box in my garage is about two feet high, one and a half feet wide and a little less than a foot deep, and is the most noticeable part of the system. It has a (disappointingly) small, two-line LCD readout that lets me know the system is operational. SolarWorks (www.solarworksca.com), the Sebastopol-based company that installed our PV system, recommended placing the box in a location where we’d see it often. There’s a good reason for this: You can’t tell the difference between your PV system doing what it’s supposed to do (offset your power use from the grid) and doing nothing. If your display is in an out-of-the-way location, you may not know it isn’t working until your next PG&E bill arrives.
SolarWorks sized our system so our $200-a-month average electric bill would be close to zero. There’s no advantage to generating a surplus, because PG&E won’t pay you for it.
The system we installed was $45,000 out of pocket. So you can see that, based on our current bill, it’s going to take the better part of 20 years to recoup our investment. Since we’re planning to grow old in our current home, that’s fine with us. Even so, if we were to sell our home sooner, we’d probably recover some of the value of the installed system. Looked at another way, our $45,000 capital investment throws off $2,400 annually, which is a bit more than 5 percent (tax-free, if you think about it).
The only downside? For safety reasons, a power failure at PG&E still means no power at my house, even though the sun is shining. We’re not “off the grid,” and that’s fine.
Solar for business
Does solar power make sense for businesses that own their own buildings? Assuming you have the roof space and exposure, yes. The federal government caps the 30 percent tax credit available to residential owners at $2,000, but there’s no cap for commercial installations. Additionally, systems are eligible for accelerated five-year depreciation.
Probably the biggest hurdle is the up-front capital expense. There are companies that are in the business of leasing solar systems. You’re still paying for electricity, but the rate will be less than what you pay PG&E. The investors get the tax benefits associated with the system. Solar Power Partners (www.solarpowerpartners.com) is one such company.
Businesses big and small are shifting some or all of their power to solar. Giant Microsoft has a 480 kW installation on its campus in Silicon Valley (60 times the size of my home installation), and little Harmony Farm Supply has a 37 kW system on the roof of its store in Sebastopol. Many school systems and wineries are also installing PV systems. The technology is no longer esoteric.
It doesn’t cost a thing to find out if installing solar is a good way to deploy capital in your business. Why not take a look (and talk to your accountant)?
