• Jessica Cornelius

Solar Economics


If you are the average homeowner you use 500 kw-H of electricity per month. That is equal to burning a 1000 watt light bulb (1 kw) for 500 hours. If purchased from PG$E you will be paying $0.40 x 500 = $200. That is about $0.26 for the electricity and the rest for delivery (transmission) , d-comisioning costs for nuclear plants, costs of maintaining its grid and so on. If you take the electric part of your bill look at the total cost charged for electric and divide by the kw-H used and you will get the true cost per kw-H due to the time which you use that electricity. Peak rates are charged between 4PM and 9PM.


A 4KW solar array will produce 5,297 kw-H Using Arcata airport historical data.


You can purchase a 4KW basic line-tie solar system for $17,985 (less 26% FITC = $13,309). Assuming you expect the house to be occupied for 30 more years the system will have generated 5,297 x 30 = 158,910 kw-H.


By making your own electricity for 30 years you will have averaged your cost per KW as $13,309 divided by the KW produced of 158,910 = $0.083/kw-H.


Compare this to the cost of buying electricity from PG$E at just the current cost of $0.40/kw-H.

Over a time frame of 30 years you will have saved:

158,910 x (0.40 - .08) = 158,910 x .32 = $50,851


Consider you have $13,300 in a safe deposit certificate paying 1%. It will take 100 years to double your money.


Consider taking those funds and investing them in your own solar to generate power. As shown above it will take only:


Y = 50,851/13,309 = 3.82 years to double your money. Expressed in interest rate using the RULE OF 72 ; divide 72 by the years it takes to double your money to arrive at the equivalent interest rate. In this example 72/3.82 = 18.8% interest on your investment


And even if you protect yourself from power outages with a more expensive battery system it is still over 10% interest on your investment with power outage insurance.


Don’t forget you will be on the right side of history by not adding to the climate change problem about 30 x 5,297 x .58 = 922,168# of CO2 whether you own the house or not.


17 views0 comments