Renewable energy is energy that is collected from renewable resources that are naturally replenished on a human timescale, these include solar, wind, hydro, tidal, geothermal, and biomass, to name a few. The Missouri property owner will typically utilize 1 to 4 systems on their property. Understanding your goals and motivations will help us guide you in designing the system that achieves the best system for your needs.
Solar Photovoltaic Energy
Terrell Electric, LLC is an advocate of renewable energy. The proper utilization of a solar photovoltaic system (Solar PV) is a wise investment for most property owners, but with all investments, it must be approached wisely and ethically.
An example, a person purchases a Solar PV system at around $3.00 per watt for Labor and Materials to attach that system to their roof. Most Solar PV Installers will sell you a 15 kiloWatt (KW) system which is15,000 watts at $3.00 per watt that’s $45,000.00. A loan for $45,000.00 at 2.5% Interest for a term of 10 years, with a $3.00 origination fee will cost you $424.21 per month. (this is only an example and rates may vary based upon individual credit score, interest rate, length of the loan, and origination fee). You will still likely be paying $60 to $90 per month to your utility company as well as the $424.21 for the length of the loan. There are really only 3 things to celebrate here 1) The $424.21 ends in 10 years, then your monthly bill will be reduced considerably, 2) Utility rates will only increase over time, and 3) You are decreasing your carbon footprint.
Now, what you have purchased and what you can expect. A 15kW system should generate 15,170 watts of DC energy which when converted to AC power will produce 2000 to 3000-kilowatt hours per month. The average household consumes around 1,562.5 kWh per month and at $0.08 per kWh, your monthly bill is about $125.00. I suspect you are seeing that you generate more than you use, so you should not have a bill. In part that is true, but you generate power during daylight hours, and you consume 60% of your electrical usage during nighttime hours. Therefore, being a little analytical, this is an estimated breakdown
|Daytime||625 kWh||2,500 kWh|
|Nighttime||937.50 kWh||0 kWh|
1,562.5 at $0.08 per kWh equals $125.00. According to Public Utility Regulatory Policies Act, utility companies are only required to purchase energy from providers at a wholesale rate, regardless of the means by which the energy is produced. The Intercontinental Exchange (ICE) shows that the utility rate for electricity at the high for 2022 was $200/mWh or $0.0002/watt or $0.02 per kWh. The accounting then looks like this: $75.00 to the utility company, $424.21 to the solar financer, and a credit for $50.00 for the month.
Clearly, in 10 years you will pay about $15,000.00 for electricity if only using the grid and if you go solar in 10 years you will spend $50,905.20. That is 339% more for solar than for utility power. So, your investment is a long-term projection.
The other disadvantage here is that during peak production periods the utility company under PURPA is buying electricity from you at wholesale rates of approximately $0.03 per kWh, then during non-peak production periods (night), you are buying electricity at $0.08 per kWh. Battery storage would allow you to use battery power from 4 PM to 11 PM daily and not use any grid power, then during the day while away at work, your solar array will charge your battery backup system.
At Terrell Electric, LLC we believe that a hybrid system would achieve more for less, creating a quicker return on investment and providing more daily rewards for going solar. According to the Department of Energy, nearly 43% of the average household’s electric bill is heating water and heating the house. For the average house at $125.00 per month consuming 1,562.5 kWh of power, this translates to $53.75 used to heat water and heat the home.
The reason solar makes sense is that we know electrical rates will only increase. Currently, in Missouri, the average cost per kWh is $0.1323 yet places like Alaska is $0.2254 per kWh and Connecticut is at $0.2162 per kWh. What this looks like in Missouri at $0.1323 for 1,562.5 kWh is a monthly cost of $206.72 and in Alaska, that same bill would be $352.19. The argument becomes, well it makes sense to use solar in those locations.
It makes sense to use solar in all locations, honestly. During the day houses on solar are not drawing from the grid, but at night all those homes draw from the grid and can easily overload a sub-station. A typical sub-station would be 20 MVA or 20,000 KVA, which is enough to serve 1,500 homes.
Now, if during the day homes are creating power to the grid, industry nearby can draw from that power permitting a substation to serve say 2,700 customers as it will serve commercial clients during the day and homes in the evening. This permits PUD’s to serve more customers with lower infrastructure costs and less impact on the environment and the community. This is an extraordinarily difficult balancing act though, coupled with Federal Solar Tax Credits to homeowners it is a great incentive to place solar on your roof.