In October, we arrived at Jim and Patty Carlson’s house near Sacramento to give them the lowdown on home solar installation technology and costs. We crunched all the numbers, including anticipated costs and payback periods, as well as what could be expected through the installation and interconnection with PG&E. Our proposal alternatives varied based on the different panel types and size of system, but were generally in line with the homeowners solar installation specifications.
We went into the details about the installation process, with quote sheets that included the total system costs minus federal and California incentives, as well as the rebates available from PG&E. The cost savings associated with solar panel installations have been widely reported, but it is no less fascinating when you see the savings and positive monthly cash flow the solar system produces written down. The cost of a $34,000 system to fully power a 1,600 square-foot home at 1200 kilowatt-hours of energy usage a month, came down to $21,000 after federal rebates.
In about 7 years they would have their solar investment paid back via the savings on utility bills, and a return on investment of nearly 18 percent over the lifetime of the solar system of 20 years or about $178,000 that would have otherwise went to the utility company.
The Carlson’s we excited when they learned how easy the process would be. With a $1,000 deposit, they would secure the $34,000 quote, begin the permit and drawing process that would show how the interconnection would happen. Within a 6 weeks, the solar panel installation was set to begin on the Sacramento area homeowners roof, and soon afterwards PG&E would would provide a bidirectional meter that would roll backwards when they are producing power and forward when they are consuming it.
However there is one more challenge many homeowners will need to overcome. Solar is expanding so quickly in the Sacramento and Northern California area that Pacific Gas & Electric Co. can’t keep up with the demand according to Steve Hart in an article for the Press Democrat. Getting new solar energy systems connected to PG&E’s power grid takes an average three to four weeks and sometimes as long as six weeks.
The solar movement appears to be growing despite the slow economy, which has made financing more difficult. Tax incentives and lower-cost technology are key to the growth, said Sue Kately of the California Solar Energy Industries Association. “We’ve been able to do jobs despite the recession,” she said.
For Gary Vuchinich of Cloverdale, the decision to go solar was easy. “We’ve been looking at this for years,” he said. Sun-drenched Cloverdale is the ideal location for solar, said Vuchinich, an emergency medical consultant. “The solar installation technology at this point is as good as it’s going be for a while.”
That is where Vuchinich story comes off the rails. It seems Garg had a problem getting the solar system hooked up to PG&E’s grid when it was completed. After hearing it could take six weeks, he went into action, contacting the PUC, his congressman and state assemblyman. As a result, PG&E connected his system to its meter in just over two weeks.
There have been other complaints about PG&E delays in connecting solar to its grid. PG&E is behind and working hard to catch up. PG&E wasn’t ready for a surge of hookup requests this year. It’s now taking an average three to four weeks, compared with a week or 10 days under normal conditions.
PG&E is making changes to address the problem, said company spokesperson Denny Boyles. “We’re looking at the process and adding some personnel to help,” he said. Homeowners aren’t the only ones tapping sun power and installing solar. Wineries, government agencies, technology companies and other businesses also are adding solar panels.
Meanwhile, the county’s first-of-its-kind renewable energy financing program is continuing to attract borrowers, despite concerns from the Federal Housing Finance Agency that it poses financial risks. SCEIP has financed 790 solar installation projects since it was launched in 2009, said spokeswoman Diane Lesko.
The county briefly halted the home solar finance program this past July when the federal agency adopted stricter lending rules for residential solar borrowers. Under the new guidelines, some property owners could have trouble refinancing a mortgage or selling a house. Commercial solar installations are not affected by the federal crackdown.
SCEIP has reopened it solar loan products, and the county is trying to resolve its differences with federal regulators. Still, solar loan participation is down about 40 percent from the first half of the year. Solar contractors and installers said the county financing program spurred business, and they hope the federal government will ease its restrictions.