THE NEW AMERICAN DREAM IS OWNING YOUR ENERGY SYSTEM

Submitted by CES on Mon, 01/24/2011 - 10:30

Owning a home is a well-accepted American dream. Even after the mortgage crisis, home ownership in the US in 2009 still ranged from the lowest of 62.6% in the West to 71% in the Midwest. It is interesting that Americans feel so strongly the need to be a homeowner, and yet are so comfortable with having no equity in the means that make that home livable. For electricity is a staple, we need to have it readily available (a lesson that gets hammered in when you go without it for more than a day). Most of us simply take electricity for granted, dutifully writing our monthly check to the utility company, with nary a thought about our economic and environmental exposure. So let me show you why it makes sense to own a renewable energy system.

Let’s take a photovoltaic (PV) system in Seattle area as an example. A 4 kilowatt (kW) PV system would produce about 4,400 kilowatt hours (kWh) of electricity on an annual basis. This is about a third to a half of an average home’s electricity consumption. The installed cost of a PV system is about $6,500 to $10,000 per kW depending of the type of components. If we take the Silicon Energy-made modules and invertors, the cost will be at the upper end. The benefit is a $0.54 per kWh of Washington State Renewable Energy Production Incentives. Below is a rough calculation comparing owning vs. renting:

	Owning a PV System	Renting Electricity
Initial Investment	$40,000	Nil
Investment Tax Credit	30%	Nil
Annual WA Renewable Energy Production Incentives	$2,500	Nil
Netmetering (1st yr.)	$460	Nil
Electricity payout (1st yr.)	Nil	$460
Net Cash In/Out flow (1st yr.)	$1,350	($5,600)
Net Cash In/Out flow (30 yrs.)	$15,000	($20,000)
Environmental Benefits	Priceless	Adding 70MT carbon to the atmosphere

If you are still unconvinced, here are my top five reasons to act now:

1. The price of renewable energy systems, especially solar electric systems (photovoltaic) have come down sharply due to the weak economy.
2. The days of plentiful, cheap electricity are fast coming to an end. The price of electricity is forecasted to increase, especially in those regions where hydro power is maxed out.
3. Both NASA & NOAA report that 2010 was the wettest year on record, and tied 2005 as the hottest year. More and more scientists are confirming that human activities have contributed to the warming trend. Why not do something about it?
4. Washington State’s generous renewable energy production incentives are set to sunset in 2020. Why pass up on a great opportunity?
5. Even if you don’t have a proper site for solar, you can still get ownership benefits through Washington’s innovative Community Solar program.

I like to hear your comments.

Joe