Green Energy (Solar PV): A Cost or a Value?

[DBoon]

I don't think ny will pay for excess production.

NY does pay for excess production - I'd have to take a look at my old electric bills to remember what it was, but it was about 20% below the generation price, so it must be some "avoided cost" rate, not retail generation rate.

 

[EatenByLimestone]

I had no idea. At least it's something.

 

[TommieValdez]

Focusing primarily on economic payback for Green Energy ignores a very important principal of what motivates people to act: People act more on what they value than on what something costs.

In a recent post I provided a financial analysis which showed that Solar PV manufactured in solar panels factory is not a cost but pays from an economic perspective. Solar Electric - 6.5 kw system The economic payback is long term. In fact, I may not live long enough to experience the economic payback, but I expect if my house is sold, the price of the house will reflect an earlier payback because the new owner will continue to receive the economic benefits. Some argue that payback must be much shorter, perhaps in the 3-7 year range, to motivate people to install solar PV. This argument is based on solely considering solar PV a short term cost and ignores long term investment return.

But an even greater fallacy is that cost is less a motivation for human action than is perceived value.

Who buys a car for economic payback, furniture, or even a house? or who has children for an economic payback (cost per child about $250,000), or goes on vacation, or does a myriad of other things for economic payback? All of these things are true costs with no economic payback. Life is lived for things we value, not for what they cost. And for the things we value, people willingly pay a huge cost with no monetary payback whatsoever.

Solar PV has high value (and it also pays back). I think solar PV as a value already has become part of the culture in some states (California) where homes are devalued if they do not have solar PV. My house may not have a "Great Room" or state of the art kitchen, both probably highly valued by a home purchaser, buy I do have solar PV which just sits there and pays me for that privilege while likely erasing my electric bill for the rest of my life. That frees me to put my money towards other things which cost and which I value, like a vacation in Costa Rica, for example; or my wife's new (used) Toyota Avalon, so we can take our driving vacations in added comfort. None of these pay me for that privilege.

It is very hard decision to make.. Personally I am not huge fan of solar power as it is bit expensive with little efficiency.. Hope things could turn around in future..

 

[jebatty]

I think an expense is more appropriately something that is associated with a consumable, and often a consumable that requires substantial additional money just to use what is consumed. A car or truck, for example. I'm not saying that the purchaser does not perceive value in the consumable.

I look at PV as an investment, yes money was paid out but it produces a 5% tax free return. Of course, maintenance cost over time is unknown, but lifespan has a good track record to payback inflation adjusted net present value and then more on top of that. Although I perceive value in the PV, the fact is that it also is returning real monetary value.

As to efficiency, a traditional coal fired generation plant operates at about 34% efficiency. PV is at about 20% maximum right now, my PV panels are at little over 16%. That efficiency comes without the social and environmental costs of burning coal. If coal (or probably even NG) had to pay the social and environmental costs associated with their use, the real efficiency likely would be much less and may approach PV. So, I don't see little efficiency in PV. What bothers me, though, is that I'm contributing my funds to relieve the public of the social costs of fossil fuel energy. That's something the utilities should be doing rather than having the public subsidize them by bearing the cost/harm from the social and environmental costs of their fossil fuel use.

 

[eclecticcottage]

I had no idea. At least it's something.

Right now there are pretty decent tax credits. We have a company scheduled to come out and do some shade and site evalution later this month. For our usage a system quote was about 12K before rebates/credits and about 3,500 after. We use so little though, that if they put a minimum maintanance fee on PV grid tied systems it wouldn't really pay back well for us. Right now we average between 250-400 kWh and usually closer to the 250.

 

[CaptSpiff]

... What bothers me, though, is that I'm contributing my funds to relieve the public of the social costs of fossil fuel energy. That's something the utilities should be doing rather than having the public subsidize them by bearing the cost/harm from the social and environmental costs of their fossil fuel use.

J: This site has hooked me with the great discussions on PV & EV, and RE in general. But what I learned outside this site is that the Utilities will do anything asked by their Regulators as long as they can work it into their 10% return. They also have a symbiotic relationship with the Regulators (read the State Govt) where the Utilities willingly play the Bad Cop role.

What that means to me is that they will never "bear the cost/harm". Those costs are paid by you and me and the "poor souls/saps" who don't/can't partake in the Govt sponsored incentive programs. In the end it's always us.

 

[Where2]

My utility has installed three solar plants of their own. I'm just cutting out the cost markup, middle man fees and dividend payments to shareholders by getting 66% of my energy straight from the same source (the sun). Today, my roof collected 5kWh more than my house has used...not bad considering my A/C is still on.