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solar electric power home system installers california, solar electric power system installer, residential solar electric power system contractor, commercial solar electric power system contractor, home solar electric power system installation contractor for Northern California, and the San Francisco Bay Area.
Solar Power System Installation - Residential Systems
The Bottom Line On Cost And Size
For a typical 3000 watt solar power home system, the homeowner would not need to spend any cash upfront to pay for the system, and would get a tax benefit in the first year equal to $2,000. Over the life of the system, the homeowner would save nearly $40,000 in after tax monthly payments. Solar energy is one of the best investments you will ever make.
That’s Darn Good, Isn’t it!
Read On To Get The Scoop
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Solar Powered Residential System Basics
How It Works
Sol-Gen Solar Power systems consist of an array of solar electric panels, an inverter and a computerized solid-state controller. The solar electric panels generate DC electricity directly from sunlight. The inverter coverts the DC electricity produced by the panels to AC electricity. The computerized controller regulates the system and directs your extra power back to the utility grid. In applications where you are not connected to the grid or you want backup power, batteries are required.
What Size Solar System Do I Need?
AAES Solar Power systems require approximately 100 sq. ft. of panel area to generate 1 kW of electricity. An average 2,500 sq. ft. single-family home uses about 5,000 kilowatt hours of electricity per year. A 3 kW (AC) system, using 300 sq. ft. of roof space, will generate nearly all of the electricity required for such a home on an annual basis. The BP solar panels used in our power systems have a 40 year design life, and come with a 25 year warranty.
Distributed Generation
Solar electric power systems are clean, silent, and have no moving parts. In utility interconnected applications, they reduce the need to move power over aging transmission lines. Producing solar electric power at, or near, where it is used and sending the excess power into the grid from thousands of decentralized points, is helping us to change the way power is produced and distributed.
The Process: Installation & Getting Your Rebate
Requesting a Free Site - Visit
After reviewing the information presented in this package, if you own your home and you are interested in learning more about solar electric power systems call Solar Power Now. We will answer any questions.
408-858-3583 or click here.
California Solar Power Cash Rebate
The California Energy Commission is presently offering a $2,600 per kilowatt cash rebate for solar electric systems that are connected to the utility grid. This is not a tax credit, this is a cash rebate. Upon signing a sales agreement, AAES will submit a reservation for you after receiving a deposit on your Solar Power system. Once the California Energy Commission (CEC) receives an application for an eligible system, they will send you a claim form showing the rebate dollar amount reserved in your name. Once your system has been permitted, installed, and is operational, the claim form and your final inspection approval will be submitted to the CEC for payment. Within 30 to 60 days, the CEC will mail your rebate check. Because of the popularity of this program, the rebate funds are rapidly being reserved and utilized, so it pays to act soon.
New Federal 30% Solar Tax Credit
Additionally, as of January 1, 2006, a 30% tax credit will be offered on all solar systems installed before December 31, 2007. For residential applications, there is a $2,000 cap; there is no cap for commercial applications. The complete cost of the system (equipment and installation) may be applied to the credit, although the credit applies to the basis remaining after any state or utility incentive available to the taxpayer is taken.
California Property Tax Exemption
Solar electric systems are also exempt from property tax in California. Qualifying systems need to be certified by the CEC and installed with a five-year warranty.
Solar Economics 101
System Cost
Sol-Gen Solar Power systems cost between $8-10 per watt installed, including sales tax. The exact system cost will depend upon the ease of the installation and roof access. A 3 kilowatt system that would power a typical California residence with good southern exposure will cost between $27,000 and $33,000 installed. After taking into account the California Cash Rebate and the Federal Solar Tax Credit, the net cost of these systems ranges from $17,200 to $23,200.
To answer any questions you might have and arrange to schedule a free site visit.
408-858-3583 or click here.
Net Metering
Net Metering measures the difference between the electricity you buy from the utility and the electricity you generate with your solar electric system. When you are making more electricity than you are using, like typical summer days, your extra electricity automatically gets metered back out (sold) to the utility grid. You receive credit for this power at the same rate they sell it to you. Net Metering allows you to use the electric utility grid like a bank account. You can put electricity into it that you don’t use immediately and you can withdraw the same amount later on at no net cost to you.
The Cost of Electricity in California
The Penalty Zones
During the California energy crisis, the utility companies adopted a complex tiered electric rate structure. This rate schedule establishes a “baseline” rate for all usage each month, up to a baseline amount that varies based upon the region in California. Usage up to the baseline amount is charged one rate, and usage above baseline is charged at a series of increasing tiered rates.
Residential customers who exceed their baseline quantities face steep penalty rates. The table below shows the rate structure for residential PG&E customers.
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Tier #Percent of Baseline Consumption
Tier 1 Up to the baseline amount
Tier 2 Electric Usage from 101% to 130%
Tier 3 Electric Usage from 131% to 200%
Tier 4 Electric Usage from 201% to 300%
Tier 5 Electric Use exceeding 300%
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Price
11.5 cent/kWh
13.0 cent/kWh
22.0 cent/kWh
30.0 cent/kWh
35.0 cent/kWh
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Rate of Inflation in California
The Really Big Savings
The biggest savings from installing a solar electric system will be realized in future years. The graph below is based upon rate data from the California Public Utility Commission. As you can see, average electric rates have increased from approximately 2 cents per kilowatt hour in 1970 to approximately 16 cents per kilowatt hour in 2001. That is an average rate of increase of approximately 6% per year.
Financing A Sol-Gen Power System
Below is an example of how you could finance a 3-kilowatt Sol-Gen system that would power an average-sized California home.
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PV System (kW-AC)
Installed Cost (1)(estimated)
CA Cash Rebate ($2.60/watt)
Federal Tax Credit (taken at the end of 1st year)
Net Cost After Rebate
Monthly Payment on a financed system (2)
Monthly Payment after interest tax deduction
Monthly Payment to PG&E for same number of kWh (3)
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3 kW
$27,000
$7,800
$2,000
$17,200
$121
$99
$184
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(1) Actual price will depend upon cost of installation and type of panel mount.
(2) Financed with a 6.5% fixed rate mortgage loan with a 30 year term.
(3) Average over 30 years. Assumes that homeowner is paying an average rate of 16 cents per kWh today, with 6% annual rate inflation. This homeowner is barely in the penalty zone.
As shown above, the average monthly payments on a typical 3.0 kW system that is financed with a tax-deductible home loan are lower than the average monthly payments that would otherwise be made to the utility company. Additionally, this homeowner will receive a tax credit at the end of the year for an additional $2,000. That’s like getting over two years of free electricity and then locking in low rates for the next 30 years. If the homeowner is further over their baseline consumption, the electric rate will be much higher and solar electric system will be much more cost effective.
Cost Savings Analysis
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Time Period
In 5 years
In 10 years
In 15 years
In 20 years
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Monthly Utility Bill
$93.68
$125.36
$167.76
$224.50
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Monthly Bill
Solar Loan
$87.05
$91.07
$96.64
$104.33
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Monthly Savings
$6.63
$34.29
$91.12
$120.17
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30 year positive cash flow = $30,693.92
The table above shows the monthly savings generated by the solar system over the first twenty years. This table assumes a 6% per year increase in electric rates. As you can see, the system pays for itself many times over and the cumulative savings are enormous! As electric rates continue to increase, the greatest benefit of a solar electric system emerges. Solar allows homeowners to lock-in low electricity rates for 30 years. If rates increase as they have historically, the price of electricity from the utility in 30 years will be 75 cents per kilowatt-hour!
Natural gas shortages have pushed electric rates higher. The majority of all new power plants to come online in the US in the last 5 years use natural gas. The wholesale price of natural gas to the utilities has increased over 300% during the last 10 years from 1995-2005. This does not include the price spikes realized in late 2005-2006 as a result of disruptions in supply from the recent hurricanes. Natural gas prices and electricity rates will continue to increase in a “lock-step” fashion in the near future.
The Bottom Line
For a typical 3 kW home, the homeowner would not need to spend any cash upfront to pay for the system, and would get a tax benefit in the first year equal to $2,000. Over the life of the system, the homeowner would save nearly
$40,000 in after-tax monthly payments. Solar is one of the best investments you will ever make.
To schedule a free site visit call Rick Niemi 408-858-3583
or Click here to schedule a Free Site Evaluation.
Your Solar Power, Alternative Energy Solutions Consultant
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