A Word on Paybacks

January 28, 2004 by
Filed under: Solar Energy 

This system is expected to generate about 500-550 kWh per month on average. That will end up being about 2/3 of our electric bill.

That makes the payback for the system about 15-20 years, depending on how quickly electric rates increase during those years.

However, some studies that my installer provided (and that I’ve seen online) state that solar electricity systems have a payback in property values of 100%. The only other home improvement project that has a 100% payback is a kitchen remodel (pools are about 60%, decks about 40%).

You really have to have a motive other than cost savings to put this stuff in – otherwise it’s too expensive. In my case, it’s to increase the ability to generate electricity in a clean manner. For every watt of electricity that I generate, I’m most likely saving generation of a watt through some polluting method – natural gas, oil, coal, etc. There’s some pollution involved in making the solar cells in the first place, but that’s some smallish percentage of the pollution avoided in their use.

And the annual savings don’t hurt either. We estimate that this system will produce negative electric bills for the months of April – June, with a positive bill for the rest of the year. Overall you can’t exceed the usage of your house – the rebate program prohibits you from being a net producer of electricity (as opposed to a net consumer) on an annual basis.

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One Comment on A Word on Paybacks

  1. Clee on Thu, 16th Nov 2006 7:06 pm

    2. Do you have any URLs for these online studies of property value payback? Thanks.

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