he idea of people feeding renewable energy into commercial grid systems has been around since the ‘70’s. With the introduction of federal and state energy incentive programs, it’s now more affordable for people to tap into this renewable energy producing, revenue generating option.
With the introduction of federal and state energy incentive programs, it’s now more affordable for people to tap into this renewable energy producing, revenue generating option.
In places like Hawaii or California, buildings with rows of solar panels on their roofs are quite common. Of course in Maui and California, there’s plenty of sun to draw on. Worldwide, Feed In Tariff (FIT) systems are available to homeowners in Japan, England, Australia, Serbia, Germany (with the largest number of photovoltaic (PV) installations in the world), and most of the rest of Europe, Puerto Rica, the Virgin Islands, Columbia and Ontario, Canada.
A Feed-in Tariff or FIT is a contract for renewable energy generation. It provides standardized program rules, prices and contracts. It encourages the development of renewable energy technology, attracts investment and creates new clean energy jobs.
Jim and Maggie have invested their savings into a solar grid-tie system in Washington State. They believe it’s a good investment even in the cloudy northwest. With cheap electricity from numerous dams in Washington State, and a cloudy weather pattern, I asked Jim what he sees as the benefits to his recent solar PV grid-tie system?
“I have been aware of the need for alternatives to our polluting oil and gas industry for years. In Bellingham, they are pushing for a new coal port. I have environmental sensitivities and wanted to do something directly. Looking at it as an investment, we spent $27,000 with a $3,000 rebate and $8,100 in federal tax credits, bringing our cost down to $16,000. No sales tax. With the combined production incentive and electricity rate of .40/kilowatt per hour (kWh) return, we will pay the system off in an estimated 6.5 years, depending on inflation of electricity. We will make approximately $10,000 over 20 years. However, it would be more of a break-even deal without the government subsidies.”
Here’s how it works: homeowners and businesses install renewable energy systems, including wind, micro-hydro, and solar – installing panels, an inverter and a grid-tie meter to produce electricity which they use and then sell the extra power back into the grid.
Here’s how it works: homeowners and businesses install renewable energy systems, including wind, micro-hydro, and solar – installing panels, an inverter and a grid-tie meter to produce electricity which they use and then sell the extra power back into the grid. They’re compensated at retail rates and receive a check at the end of the year. Different companies buy at wholesale rates after the consumer reaches zero for their own use. Some solar incentive programs pay you back over time while others offer one-time payments of rebates or credits. To qualify for incentives, your solar system may have to be installed by a licensed Photovoltaic System Installer, and/or connected to the grid by a licensed Electrician. This may be particularly true for Grid-tie systems.
Incentive types can be specifically for residential, schools, business, or industrial and some states are inclusive of them all. Some incentive programs include photovoltaic (solar), wind, hot water generation or multiple technologies.
The easiest way to check these different programs by state is through a website and database called Dsrie, which outlines the various programs across the U.S.
Although not all states have utility companies willing to purchase excess renewable power from their customers, California law requires that utility companies offer what they call a net metering program to their customers. This is part of California’s renewable portfolio standard (RPS), where all green attributes associated with the energy, including renewable energy credits (RECs), transfer to the utility with the sale. Most recently, Governor Jerry Brown passed a law that will require California to get 33 percent of its power from renewable energy by 2020. Similar to Washington State, there is no sales tax on photovoltaic systems.
In California they will pay 5 cents per kWh and in Washington, Jim and Maggie will get 8 cents per kWh from Puget Sound Energy (same cost as use) and .36/kWwh from Washington State. Sunny Hawaii offers between 21- 54 cents per kWh. An informative website that allows users to select their area within 40 km. and calculate performance data is PVWattsTM.
Jim told me how he got into this:
“We have an Energy Challenge Program, and the first thing they do is come out and make an energy-efficient audit for your home. Using reverse pressure they find out where the leaks are, and tell you what to do to get optimal energy efficiency. We had just remodeled, so we were 95% efficient already. They gave us the information about this project, as it is run through this program. That is why we got a $3000 tax credit by running it through the program.”
Jim and Maggi’s system can produce 5.04 kw (5040 watts). Their solar panels cover the roof of their garage, which is in an unshaded spot. They used Ecotech Energy as the system provider, who also did the installation with its Bellingham made Itek solar panels, Aurora inverter and production meter socket.
Jim and Maggi starting operating on winter solstice:
“In two months we generated 400 kw. hours. It is minimal during this time of year. I have a meter on the garage that tells me how much we’re generating a day.”
The Community Energy Challenge that the Washington-based program provides is one of many that help subsidize the costs of moving to solar, wind and small hydro-electric systems. Jim just told me that the state incentive portion of the program is up for renewal – currently ending in eight years. Which leads me to ask, are there government subsidies for petroleum-based energy sources?
According to energy guru Bill McGibben, “All major energy sources in America are subsidized, and have been for a long time. … with the worlds carbon levels at 390-410 parts per million and rising, globally emitting over 32 Gigatons of CO2 each year, causing Global Warming and life changing pollution, Renewable Energy will address these issues and start us on the road back to 350 parts per million of carbon.”
…solar power could provide 100% of worldwide energy needs in just 20 years…
Researchers such as Raymond Kurzweil working with the National Association of Engineers projects that solar power could provide 100% of worldwide energy needs in just 20 years. Germany, on a sunny day, provides all its energy needs through solar power.
Jim said “certain parties benefit from keeping us tied to the petrochemical industry, so it’s an on-going political struggle to increase renewable energy sources, preserve clean water, and clean air. Even Richard Nixon was in favor of clean water and clean air – and he started the Environmental Protection Agency. So things have actually back slid in some ways, because it wasn’t controversial at that time.
Personally, it just seemed like the right thing to do. We can’t keep fouling our own nest. Yet, we couldn’t have done this unless we cut down a big fir tree. We had it assessed and it wouldn’t have been reasonable as it blocked too much of the sun. There was pitch all over the place, so we decided if we are getting rid of the tree, we should get solar panels. So there’s a price for everything – if you want to hug every tree there might be some other things you can’t do.
Many companies are investing capital into the PV market. This includes the growing dominance of leases and third party owners. Some companies are providing 100% financing for project costs on approved commercial projects and some residential projects.
These large grid-tie solar energy systems provide much more energy than a single household would use. Some companies offer both grid-tie and off-grid systems plus a combined grid-tie and off-grid option. There is a significant cost premium ($7,000- 20,000) to have grid-tie PV systems that incorporate battery storage installed at home. These systems would continue to provide power during utility outages with the PV array providing the battery charging energy. This would be an effective safety net should the grid go down during hurricanes or other climate change events.
For further information on off-grid solar systems, read Eartheasy’s article on “Our Simple DIY Home Solar Power System“.