In the past, we’ve talked about passive solar and solar hot water technologies as ways to capture the sun’s rays and put them to good use. We’re very aggressively using passive solar, but opted against using solar hot water as we won’t use enough hot water to justify the system.
But the type of solar technology that’s causing the most excitement in the media today is called “Photovoltaics,” panels that convert solar energy into electric power that can be used on the site, or sold back to the power company. In planning our building, we installed conduits to run wiring from the roof to the garden level if we ever added solar panels, but we didn’t add the solar panels themselves.
Today, we’ll look at “why” a building that is so aggressively designed to be energy efficient and environmentally friendly doesn’t have photovoltaic panels installed on its roof---and what you can do to change that.
But first, two bits of background:
- If there is one overriding principle that I have learned through the process of designing and building this building, it is that smart building starts with the premise that no two buildings are alike. Every site is different, every use is different, every neighborhood is different—and these factors interact in a myriad of ways. Figuring out the smartest use of technology is a case-by-case effort. But that’s where the efficiencies come in.
- We wanted to build a building that would cause other people to re-think the way we build buildings in the community and adopt green building technologies. To do that, the building had to make not only environmental and energy sense—it had to make economic sense as well. We declared early on in the process that the building had to be economically defensible both as a reflection of our commitment to financial stewardship, and as a way to encourage others to follow our lead.
Given these two principles, our threshold for installing new technology in the building was that it had to demonstrate a payback of ten years or less as opposed to the alternative. So far, for our building, at our site, photovoltaic energy generation hasn’t demonstrated that payback.
Since photovoltaic energy is so environmentally friendly, this has been a deep source of frustration to the design team, but it’s a point on which we won’t waiver. Our analysis of the economics of using solar panels suggests that it would take about 60 years to recoup the investment. Again, that’s for our building and our use. Unlike private homeowners who are installing solar panels, for instance, The Community Foundation can’t avail itself of tax credits to offset the cost (we don’t pay income taxes).
Still, we know there are a lot of passionate solar advocates out there. So here’s our offer: Prove us wrong.
We’re using in our assumptions a rate of $0992/kWh for the energy we purchase from Met Ed. In addition, we’re paying $.00378/ kWh for the Renewable Energy Credits (RECs) for wind power. Both of these numbers can be used in calculating our cost. You should assume that building occupancy will commence (for these purposes) on
We acknowledge that the lifting of rate caps will have an effect on electric prices. For our assumptions, we assume that the cost/kWh will increase by 35% to $.13392 effective
2 comments:
In my experience you will need to combine several financial strategies to bring your payback below 10 years. Straight payback on avoided energy savings alone will be very long.
First you will likely need some type of grant funding. Possible sources are:
Commonwealth Financing Authority
http://www.newpa.com/find-and-apply-for-funding/alternative-energy-funding/index.aspx
PA DEP Energy Harvest and PA Energy Development Authority. Both are closed for this year but will likely open again next year.
Mon, Jun 29, 2009
PA CONSERVATIONS WORKS! UPDATE
On June 27, the Pennsylvania Bulletin Notice announced the availability of guidelines for the new PA Conservation Works! program. These guidelines are currently being finalized and will be available the week of July 6. Please check back to this site for updates. The Department of Environmental Protection will begin accepting applications for the program July 17.
It does not appear that you would be eligible for the PA Sunshine Program.
Later this year Met-Ed will likley be offering some subsidies. Check with the folks who are preparing their plan for Act 129 implementation. Programs should role out early next year.
Another possibility would include exploring whether you can sell your RECs. This has LEED implications, in order to qualify for EAc6 Green Power you would need to buy 200% of the RECs sold to earn this point.
You system may be too small but there are companies who install PV systems and can take the tax credits and various incentives and then lease the PV power to you with a long term contract. One such firm is:
http://www.sunedison.com/commercial--solar-energy-power-investment-credits.php
There are a couple of other firms I have seen that provide this service for residential systems but they operate in California.
To obtain a reasonable payback you will need to cobble together one or more of these subsidies to get the payback where you want it to be. A straight up pruchase, as you have found out, is still not economically viable.
Marcus:
Thanks for the input. Very helpful advice. One of the things this process has reminded me of is how 'unlevel' the playing field is. If we ever tried to find all of the federal, state and local subisidies for carbon-based fuel, we'd never succeed. They're so integrated into the tax code, transportation policy etc. that you can't identify them.
If we weren't hiding the cost of carbon based energy, some of these alternatives would surely look better.
Kevin
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