I've analyzed the economics of solar power in Vermont under GMP's new "Solar Rate" net-metering program. This program offers people a "market rate" credit from their power bill for solar power generated by homes and sent into the grid, meaning people can go solar without having to go "off grid."
Most importantly, the economics of solar power now makes sense, even in Vermont. After consulting with experts at Northern Power, Yestermorrow Design/Build School, Solarbus.org and others, I've calculated the realistic "return on investment" Vermonters can expect. Here's a summary of the solar-economics:
With Vermont's average of 4.5 hours/day of "Full Sun" (including average number of cloudy days, winter's shorter days, etc.), a 2,000-watt solar system (that will cost around $15,000 to purchase/install), will generate 270 kilowatt hours per month.
Assuming that the cost of electricity will increase only 6 percent per year during the next 30 years, the 270 kw hours generated each month and "net-metered" will equate to an average annual savings of over $1,600 per year over those 30 years. That means over the course of the 30-year expected lifetime of the solar panels, the home will save over $49,000 from that $15,000 investment. That's a 30-year ROI of 231 percent which would please just about any investor, and a "breakeven point" of 16 years from the initial investment.
To see a detailed annual view of the cost/credits for a typical home under this scenario, visit my blog at http://carbonshredders.org/blog/4.
Because the solar panels can connect right to a home's power meter, there's no need for dozens of expensive batteries that need to be replaced every five years. And homes have the convenience of being able to use more power than they generate with their solar panels if they need to.
With all the homes out there carrying mortgage debts of hundreds of thousands of dollars, a $15,000 investment to save $49,000 seems pretty reasonable to me.When I had looked into solar in the past it seemed that the net-metering process was too complicated and didn't pay out fair value for power generated, etc., and dealing with batteries never quite made sense.
Thanks to your recent editorial about GMP's new program, there is at least one more home in the Mad River Valley that will be going solar as soon as possible.
Shred, Don't Dread!
Gaelan Brown, is an energy optimist and Blogger at www.carbonshredders.org, www.vtcommons.org. He lives in Fayston.
