On the positive side, electricity prices will probably go up. On the negative side, the PV cells will likely deteriorate at a 0.5 to 1% rate[1]. At 0.5%/year, 30 years would be 86% original rating (not bad). At 1%/year, 30 years would be 74% original rating (still fairly effective).
[1] http://info.cat.org.uk/questions/pv/life-expectancy-solar-PV...
The utility bill savings more then compensate for the extra $60 in the monthly loan payment.
Most solar panels come with a 25 year warranty.
Edit: I'd love to put solar in my house. We have a rebate in my country as well, but I'm sure I can use the money better in the short term, and likely end up with a more efficient setup for less money if I wait. Until then, geyser blanket, install LED's in the most-used light fittings, install a small geyser under the kitchen sink so it doesn't draw the full pipe's water just to wash dishes.
When the paradigm is changing, investing is risky.
However, if you buy a system now and it's 10% cheaper in a year and you would have made say 3.5% on the investment [1] you'll be out 13.5% minus your electricity savings, and that's in 1 year. What about 4-5 years? Won't it be much cheaper then?
[1] I've made about 37% this year as a fairly active trader, so every cent means a margin of safety. No solar for me because I need the cash!
But when the costs converge this closely then small assumptions can tip the scale one way or the other - one % extra opportunity cost, a converter that needs replacing 5 years earlier, 10% less sunshine in one of the earlier years of the installation's lifespan, ... That said though, when you extrapolate costs of grid electricity of the last 10 years, and base your energy price scenario on that (instead of keeping up with inflation like I did), PV comes out ahead even when taking worst-case scenarios of all other variables.
Many people argue that because prices are falling so fast, it doesn't make sense to buy now. But IMO it's much more nuanced than that:
- As prices fall, so will subsidies. Already most subsidies are being phased out or decreased.
- There is a floor on the prices - in the short term that floor is just below grid parity, in the medium and longer term it will be production limits. I don't think it's rational to assume that prices will keep falling so fast.
Many words have been shed on this - I guess only time will tell. That said, like I posted elsewhere here, my parents are getting an ROI of 11% on their panels. That's mighty good for money that can be borrowed under mortgage, and 'green' == cheap mortgages for that matter. (that yield is only because of subsidies though, so it's not really a fair general case comparison).
Of course after a few years these situations will change and as more players enter the market (lured in by the high profits of the existing ones...), the downward trend will continue, without the anchoring to 'grid parity' that exists today.
How much of "rated power" does that warranty cover?
Suppose that the power output drops 20% by year 29, what will the warranty pay? How about if the output drops 15% by year 20?
It's unlikely that the warranty will pay full replacement value. Most warrantys cover pay value, which is likely to be fairly low for 20-30 year-old PV panels. And no, they won't fix if that costs more than the "value".
(Of course, this ignores the format differences; if sata goes out of style, it could actually cost me more to source a sata part. Of course, judging from how long PATA lasted in a largely backwards compatible format, I /probably/ wouldn't have to worry about that too much in the next 10 years, but it'd be a source of worry. I'd be much more comfortable promising you 2tb of storage of some type with some minimum performance level, and not specifying interface, or selling you network-accessible storage for the next ten years.)
Another huge problem with these calculations is the very small fraction of people who stay in one house for more than 10 years. Essentially you have to stay in the house for the entire payback period or you've lost out.
Personally I think the solar price will have to drop to the point where it is much lower than grid (with no subsidies), rather than just about equal. At that point, takeup will be much higher.
As far as moving goes, studies show that solar systems increase the value of a house by approximately the cost of the system. Of course, if solar system prices fall as expected, this premium would likely drop also.
And the economics are the same for a system where the cost is rolled into a loan during a home loan refinance, an option available to many people now.
Florida gets a lot of sun. I agree with you that a tracking array of new panels in Florida gives those numbers.
For people in other parts of the country and without trackers I find this site that has monthly solar radiation numbers to be useful for estimating output.
http://rredc.nrel.gov/solar/calculators/PVWATTS/version1/
Looking around I see that a 4500W system, no installation, no tracking, runs about $20,000.
http://www.infinigi.com/4500w-solar-grid-tie-system-20-sanyo...
http://www.sunelec.com/comparisons_of_grid_tie_systems_price...
Optimal tilt just refers to the tilt the panels are installed at, no tracking.
Total hardware costs are currently about $1.75 watt for panels, inverter and hardware. Fed Tax rebate is 30%.
The federal DOE site calculator for the same 4.5kWh fixed tilt plant gives 4580 kWh/yr for Portland (http://rredc.nrel.gov/solar/calculators/PVWATTS/version1/US/...), ranging from 142 kWh/mo in December to 578kWh/mo in July. What accounts for the discrepancy between the two calculations?
(I do think you're right about the confusion and exploitation of the difference between peak power and average power.)
5 hr * 4.5 kw * 30 days/month = 675 kwh/month
http://rredc.nrel.gov/solar/calculators/PVWATTS/version1/US/...
It might become reasonable in Seattle at some point, depending on the costs of installing a system with tracking. One should also factor in that peak output decreases over the life of the panels in figuring out lifetime cost/benefit, and not just look at output numbers from the first year.
It's important to establish what specific area we are talking about in these discussions and what particular sorts of systems we mean and their actual complete costs. Not everyone lives in Florida or Hawaii and my understanding is that tracking systems are quite rare and have their own issues. I've only seen one tracking system myself, it was at a school installation that was done in a field. I have not yet seen them on rooftop installs. There is little information about them but often estimates include numbers assuming tracking.
Given the rate solar PV panel prices are falling, however, PV in Seattle-type climates (and in Germany like the OP discusses) may be economic much sooner than many people expect.
This is not strictly correct, tracking does help as the numbers from the DOE calculator show. However, the cost of purchasing, installing, and maintaining a tracking system will cancel out some, or possibly all of the gain. How much so is not clear.
In this case, a 4500Wp fixed angle installation, which appears to be available for around $12,000 not including installation or installation brackets generates 4364kWh per year in Seattle, saving the homeowner $279.30 in annual electric costs given the alleged 6.4¢/kwH rate in Seattle (which seems very low to me). This is equivalent to a 2.3% return on the investment, with, unlike in savings, the principal is non-recoverable and expires after 25 years as the panels reach their end of life.
The numbers are better for other cities true. The DOE calculator gives 5491 kWh/yr for a 4500Wp fixed angle installation in Hawaii, with 18.1 cent electricity. Over a year, the electricity value is $993.87, an 8.2% annual return, but again, with the principle not returned and the investment expiring after 25 years.
The sad thing is that First Solar's thin film panels hit $1/watt a few years ago, but you are unable to buy them in the US due to Solar City getting an exclusive and deciding to only leasing them at nowhere $1/watt.
That's not how it works unfortunately. Most of the cost of a utility are fixed. If more people are using PV then the fixed cost get divided over a smaller number of kWh and the cost of the remaining non-PV kWh goes up. Since peak usage in most countries is when it's dark the utility will not be able to reduce its fixed cost until someone finds a way to store energy in an economical way. The utility will simply have to stop paying for electricity delivered back to the grid because they will no longer be able to afford it (the only reason they do that now is politically motivated).
Citation needed.
http://www.srpnet.com/prices/home/tou.aspx
Looks to me like most of the peak hours are when the sun's out; especially in the areas where PV panels work best.
Solyndra is an early casualty, since their business model depended on PV panel prices to fall much more slowly.
The economics of home based solar electricity depends on three numbers, the panel price, the local retail electric rate, and the interest rate of the loan for the system. Right now, in much of the US, you can see that a PV system makes sense for new construction. A simple example:
In a nutshell, this is grid parity, right now in 2011. And the owner of such a system does not need to worry about utilities increasing their rates over the years.