How Much Will it Cost Me?!?

Embedded Costs:

The price of a photovoltaic system is reflective of the trading price of modules, the availability and shipping distance of the modules, the size of the order, and the type of system being installed.

The price of PV modules had been decreasing since the 1970’s when they started to become commercially available.  Recently, however, a combined tug-of-war between consumers purchasing solar panels and microchips has put an unprecedented stress on the polysilicon supply, which is crucial to current solar panel production.  Prices have been fluctuating for the past few years with the lowest prices occurring in the summer months of 2004.

Prices of PV are usually referred to in $/Watt, or “Dollars per Watt.”  This is similar to thinking in oil as “Dollars per barrel” as they are both monetary representations of a known amount of energy.  A typical household could install a 3 kW system (that’s 3000 Watts) to offset a substantial proportion of their electricity demand. 

Recovered Costs:

A small installation, such as 3 kW, would cost about $10/Watt to install.  This price includes the cost of the solar panels, which is single-handedly responsible for this drastic price jump from $8/Watt, which up until this past winter has been the going rate for an installation. 

BUT!!!

Don’t despair, there is a lot of help from the federal and state governments to help drive down these costs.  DSIREUSA.org keeps an up to date database of all of the state and federal incentive, and provides detailed eligibility and timing information about the programs.

Let’s look at the actual cost to you for a system of this specification:
This example is for a residential system in New YorkState, different incentive programs exist for each state, and according to the type of installation, see www.dsireusa.org for more information.

Federal Incentives:

• 30% Personal Tax Credit ($2,000 cap)

State Incentives:

• 25% Personal Tax Credit ($3,750 cap)
• $4.00 - $4.50/Watt Rebate
• 15-yr Property Tax Exemption
• Solar Sales Tax Exemption
• Energy $mart Loan (reduces interest rate by 4%!)

After applying the monetary incentives the initial investment is reduced from $30,000 by over 40% to $12,225.

Applying this net cost to the available Energy $mart Loan program results in monthly payments of around $124.

This is your price for the energy that the system produces. This price will not change; it is not susceptible to the same forces that control current electricity costs.  The effect of this to you is that you can now fully rely on knowing the price of your energy; you are removing yourself from the volatilities and uncertainties of energy markets. 

What’s more, in ten years, you don’t pay this anymore!!!!

That is far less than half of the lifetime of your solar electric system.  From this point on, you’re essentially making money!!!

It actually is a little bit better than that even.  Consider the fact that every kWh of electricity that your new solar electric system produces is one kWh that you don’t have to buy from the utility company. 

Here's what it looks like:

This mortgage is paid in full after 10 yrs. The result in our example is equivalent to an average monthly income from the system after ten years.