A San Franciscan talks about getting off the grid….
From January through November of 2004, my system has generated 4,400 kilowatt hours of electricity. During this period, my home has drawn 2,200 kilowatt hours from the public grid (for total consumption of 6,600 kilowatt hours). My system is currently generating roughly 65 to 70% of the electricity my house consumes. The system reduces the cost of my electricity even more because it lowers my home’s average consumption enough to get me into the lowest pricing tier ($0.13/kWh versus $0.19 to $0.25/kWh). So what electricity I do pull from the grid is now billed at the cheapest rate.
This is an important point, especially if you draw 500 kilowatt-hours per month or more (as most modern homes do). If your utility company uses a tiered rate structure, it is likely that the majority of your power is billed at high above-baseline rates that can be two to three times the baseline rate. The power generated by the PV system will offset the most expensive grid-supplied electricity first. So even if your system generates only a modest share of the home’s power, say 35 to 50%, it can reduce your electric bill by substantially more than this.
The bottom line: in phase one, I reduced my home’s electrical energy footprint by 65 to 70% in kilowatt-hours and by 80 to 85% in dollar terms (because of being knocked down into the lowest $/kWh pricing tier). The system is currently generating about $1200/year of electricity. Not bad, and since the array will last 30 years or more, it will more than pay for itself, even if the cost of energy remains flat (though it is more likely to increase as competition for finite fossil energy supplies increases).
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In addition to the direct return on investment, the systems provide several additional direct and indirect benefits, including:
- Increase in home value: each $1 in utility bill reduction is estimated to increase home value by $20. Therefore, the energy production systems increase the value of my home by about $34,000, yielding an immediate 50% return on investment.
- Stable, long-term energy costs: because it produces most of its power, my home is largely protected against increases in energy costs. As energy costs increase, the math becomes even more favorable toward renewable energy systems.
- Protection against property incursions: local zoning rules often prohibit neighboring property owners from building anything that will cast a shadow on rooftop solar installations. This is a helpful protection in urban environments, as it prevents someone from building a “McMansion” next door to your home, which helps to protect your home’s appearance and value.