Solar power has hit Bill McEleney’s pocketbook – but in a good way.
Putting solar panels on his roof was an idea that “just rattled around” for years, says the Cranston, R.I., engineer, until he saw panel prices plummeting in December and decided to get off the fence.
He got a bid for a rooftop solar power system, but was delayed eight months. Still, that delay worked to his advantage as solar-electric prices continued to fall – eventually cutting the cost of his 3.8-kilowatt system by $4,000 (from $32,000 to $28,000), which allowed him to install a more powerful system.
But the deal was even sweeter overall. A newly revamped 30 percent federal tax credit means that Mr. McEleney’s total cash outlay will be only about $15,000, compared with the $32,000 he was quoted eight months ago, he says. He will still pay 15.7 cents per kilowatt-hour for any power he buys from his local power company, but his solar system will replace $750 of utility company power annually. The system will pay for itself in 15 to 20 years, while insulating him from rising utility rates.
“It’s a good deal and it’s maintenance-free; you just watch the meter go backward,” he says. “I’m even kind of rooting for [utility company] rates to rise now.”
Solar photovoltaic panels, which convert sunlight directly into electricity, have long enjoyed the dubious distinction of being the most costly form of renewable power. But now, with cheaper raw materials and a global production overcapacity, solar-panel companies are slashing prices.
It’s a tough time to be making solar panels – but a great time to be buying them: Prices have fallen 40 to 60 percent in the past year. With panels accounting for about half a system’s cost, the overall price tag has fallen by up to one-third – and is still dropping, says Travis Bradford, president of the Prometheus Institute, a renewable-energy think tank.
In California, he adds, solar rooftop power is now cheaper than buying electricity from utilities, when incentives are included.
Geoff Stenrick, who sells solar panels from his SimpleRay website in St. Paul, Minn., has been pitching “summer blowout” prices and “free shipping” on orders of more than $1,000. A 200-watt panel that was $987 is now $689. That’s $3.45 per watt, a 30 percent drop. Just a year ago, $6 to $7 per watt was typical.
“We are basically understaffed for the response we’re getting from customers,” Mr. Stenrick says. “The phone is jumping.”
While California’s generous incentives make it the nation’s solar-panel hotbed, cooler parts of the US are seeing a pickup, too.
“We’re now at that very important place where, with tax incentives, you can actually make an economic case for homeowners to put solar on their homes,” says Bill Kanzer, marketing director for Alteris Renewables, New England’s largest solar installer. “In these key markets solar is moving from the fringe and early adopters to more of the mainstream.”
Rising interest in solar residential electricity has as much to do with a national mind-set shift as anything else, some say.
“You’ve got a favorable political climate and about the best financial incentives I’ve ever seen,” says Richard Perez, publisher of Home Power magazine. “But the main reason is there’s just more public awareness. That’s the key.”
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