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by Regina Anne Kelly f you were to stop people on the street and ask them to name states known for strong growth in solar-electric system installations, chances are that few would mention New Jersey. But the state has some of the most favorable residential and commercial solar incentives in the nation. Here's how a New Jersey couple put solar electricity to work for them— at home and on their rental properties.

In 2006, the total number of residential and small business grid-tied solar-electric systems in New Jersey topped 1,500. This was an exponential increase from just five years earlier, when there were only six installed in the state. The impetus for this amazing change? New Jersey's incentive-based clean energy program, which was launched in 2001.

Strong financial incentives enticed Peter and Tanya Ptak to invest in three solar-electric systems. In 2005, they installed a system on their Red Bank home and, because New Jersey's solar support was so sweet, decided to have two more systems installed on their rental properties in 2006.

PV's Appeal

The Ptaks wanted to put an end to their electric bills and support clean energy in a state that generates almost half its electricity by burning coal. Then they discovered that New Jersey's Clean Energy Program (NJCEP) could allow even a family with an average income to afford an investment in solar electricity.

Especially enticing was the short economic payback period for PV systems under NJCEP's program. "Many people here pay [their utility] $200 per month for electricity," says Peter. "When do they finish paying that off? Never!" In contrast, investing in a solar-electric system can be likened to paying electricity bills several years in advance, and at a fixed rate. With New Jersey's attractive renewable energy incentives, the Ptaks calculated that a properly sized PV system that would meet all their electricity needs could pay for itself within seven to ten years. After that, all the electricity it produces is not only free, but surplus electricity generated means that the system will be earning them money.

When the Ptaks installed their first system, they received a one-time rebate of 70% of the system's total cost. New Jersey also issues Solar Renewable Energy Certificates (SRECs)—financial credits granted by the state's public utility commission. Owners of systems that produce energy from renewable sources receive credits for the clean energy their systems generate—credits they can then sell to electricity suppliers to help them meet the state's renewable portfolio standard.

Another important financial incentive is net metering, by which utilities credit owners of grid-tied PV systems at the retail rate for any electricity their systems produce, until their cumulative electricity use is offset. In New Jersey, annualized net metering zeroes a customer's account at the end of a 12-month cycle, based on the system's initial commissioning date. This allows surplus energy generated during sunnier months to be banked, and the credits applied against utility electricity used during seasons when the PV system produces less energy. At the anniversary date, any surplus energy credit generated beyond what the home or business has consumed is purchased by the utility at their "avoided cost" rate (usually about 25% to 30% of the retail rate per kilowatt-hour), and a check is issued to the customer.

The up-front incentives, coupled with solar energy certificates, a solid net-metering program, and the prospect of generating pollution-free power, appealed to the Ptaks. They were consuming approximately 6,800 KWH of electricity per year, and spending up to $90 per month on electricity for lighting, localized space heating, and appliances. Investing in PV systems to power both their home and rental buildings would be good for the environment—and their pocketbooks.

Solar Savings

Sea Bright Solar, a PV system design and installation company, provided the Ptaks with an estimate for a batteryless 5.44 kilowatt (KW) solar-electric system that would offset all their home's annual electricity usage. The Ptaks took advantage of Sea Bright's payment program of floating the rebate, a common practice among New Jersey installers that allows customers to divide the after-rebate cost into installments. To ease any impact on their budget, they divvied the total cost into three payments: a deposit, a payment upon equipment delivery, and a final payment after the system passed local electrical and building inspections.

Since the system's installation in 2005, besides eliminating their electricity bill and saving them $780 in their first year, it has earned the Ptaks $1,000 through SREC sales. In 2006, on the system's first anniversary, they also received a $65 check from Jersey Central Power & Light for the surplus energy their system generated.

The Ptaks predict additional "future" savings beyond their utility bills and SRECs if they ever decide to sell their home. According to a report funded by the U.S. Environmental Protection Agency and the Department of Housing and Urban Development, every dollar saved in utility bills the first year that a PV system is installed represents a $20 increase in property value. Based on this estimate, the Ptaks' PV system's first-year savings would translate into a property value increase of $15,600—well above their initial investment of about $13,000. Not factoring in the increase in property value, their financial break-even point to recoup the system's initial cost will only be about eight years.

After installing PV on their residence, the Ptaks also installed solar-electric systems on their rental properties.

After installing PV on their residence, the Ptaks also installed solar-electric systems on their rental properties.

Renewable Rentals

Their home PV system's many benefits inspired Peter and Tanya to consider solar electricity for their two rental homes, across the street from their house. After some serious number-crunching, they realized installing PV systems on the two rentals would make them eligible for a combined rebate of more than $50,000. Plus, they'd own the SREC production of their rental properties' systems, estimated to generate about $2,500 in annual income. Installing the systems as a business venture also meant the Ptaks could take a 30% federal investment tax credit.

It was too good to pass up. In the fall of 2006, the Ptaks had a 5.27 KW system installed on one three-bedroom, single-family rental property and a 4.59 KW system installed on their other Cape Cod-style rental home, as part of a Solar Energy International PV design and installation class. Three primary criteria determined the size of each system: the area of the available south-facing roof, the Ptaks' desire to eliminate as

Two Power-One Aurora inverters synchronize the solar-electric system's output with the utility grid.
Note: All numbers are rated, manufacturers' specifications, or nominal unless otherwise specified.

much of the buildings' grid electricity use as possible, and a unique rebate policy that considers two adjacent properties with the same owner to be eligible for one combined rebate. Under the current NJCEP solar rebate schedule, the greatest rebate is available on systems that are no greater than 10 KW. To maximize the rebate, Sea Bright Solar's system design fully utilized the available roof space on both houses, for a combined system size of 9.86 KW—just under the maximum.

"Before installing the PV systems, I found that our renters had a tendency to use—if not waste—more energy than we, as homeowners, did," says Peter. Housemates typically would split the electric bill evenly, resulting in lower individual costs—with little incentive to conserve energy. Peter and Tanya were interested in encouraging more energy conservation, while passing the solar savings on to their tenants. They charge their tenants about 90% of the utility value for the solar-generated electricity, while the tenants are responsible for paying any utility balance beyond what the PV system generates. "Charging a slightly reduced rate for electricity makes it more enticing for them to rent," says Peter. "This keeps the properties rented longer, which keeps our profit margin higher over the years."

PracticaL PV PayofF

The Ptaks are passionate about the practical benefits of tapping into the sun for electricity. They now have a minimal to nonexistent electric bill and annually receive a check for any surplus electricity their systems generate. They are also proud to have effectively reduced their "carbon footprint," environmental pollution, and other associated impacts of burning fossil fuels. Their home's PV system alone saves about 9,100 pounds of carbon dioxide, 32 pounds of nitrogen oxide,

Tech Specs (PTAk Residence)

Overview

System type: Batteryless, grid-tie solar-electric Location: Red Bank, New Jersey Solar resource: 4.7 average daily peak sun-hours Production: 540 AC KWH per month, average Utility electricity offset annually: 100%

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Solar Panel Basics

Solar Panel Basics

Global warming is a huge problem which will significantly affect every country in the world. Many people all over the world are trying to do whatever they can to help combat the effects of global warming. One of the ways that people can fight global warming is to reduce their dependence on non-renewable energy sources like oil and petroleum based products.

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