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Allentown Examiner, October 2005

Common Energy Efficiency Problems in the Home

1. How Does a Solar Electric System Work?

· Photovoltaic Panels collect sunlight and convert it to electricity (DC).

· Inverters condition DC electricity for use by the home or business (AC).

· Your home or business runs normally, with much lower electricity bills.

· Excess solar electricity is sold to the local utility…your meter runs backwards!

· As your system generates electricity, you automatically accrue renewable energy certificates, which can be sold on the open market (in New Jersey with SREC Program).

A typical 200 watt solar panel, is about 5’ x 3’, and weighs about 40 lbs.

2. What makes a good Solar Electric Site?

a south facing or flat roof with at least 350 sq. ft. of open space **
an exterior roof membrane with at least 10 years of life remaining
little or no shade from 9 am until 3 pm
few or no roof based obstacles that may cause shading (i.e. chimney, ventilation pipes)
an up to date electrical system (some systems may require a service upgrade to support the added power that a PV system will generate)

** Systems may also be pole or ground mounted in a field (see “photos” for examples)

3. How much power does a Solar Electric System generate?

Based on values obtained from the NJ Clean Power Estimator, and assuming a northern NJ or southern NY location, due south exposures and no shade from 9 am until 3 pm, a photovoltaic system is estimated to generate electricity as follows:

· A 10 kW system typically generates about 11,500 kWh/year.

· 5 kW system typically generates about 5,500 kWh/year.

4. What about Solar Renewable Energy Certificates (SRECs)?

New York State does not currently have an SREC program.

In New Jersey:

The following answer was taken from New Jersey’s Clean Energy Program™ website on November 14, 2005, and is subject to change.

New Jersey SREC Program - SREC stands for Solar Renewable Energy Certificate and is a tradable certificate that represents all the clean energy benefits of electricity generated from a solar electric system. Each time a solar electric system generates 1000kWh (1MWh) of electricity, an SREC is issued which can then be sold or traded separately from the power. This makes it easy for individuals and businesses to finance and invest in clean, emission free solar power.

Systems generating 11,500 kWh per year will accrue 11.5 SRECs. Should one sell these SRECs for $600 each, recent market values, the total cash value is $6900 (11.5 * 600). Please see the New Jersey SREC Program for details.

5. How much does a Solar Electric System cost?

The answer to this question is based on several pieces of information:

- installed cost
- state incentive (in the form of a cash, and/or tax credit)
- local incentive (in the form of a property tax abatement)
- federal incentive (in the form of a tax credit and rapid depreciation)

Commercial PV systems typically cost as low as $7 per watt.

Federal, State and Local Incentives

Federal Incentives:

** Only your tax professional can tell you how incentives will impact the final cost of your system.

New York:

** Only your tax professional can tell you how incentives will impact the final cost of your system.

New Jersey:

** Only your tax professional can tell you how incentives will impact the final cost of your system.

6. How long does it take to break even?

First, keep in mind that PV systems are investments...they produce clean electricity for decades. As utility costs go up, your system, and the power it generates, becomes more valuable. In NJ, the sales of SRECs can produce significant income each year.

The answer to this question can be quite complex due to the many federal, state and local incentives. Break even points typically run from 4 years to 8 years. Every situation is different. We provide a break even analysis with our proposals. Only your tax professional can tell you how incentives may impact your system's cost.

** The cost of electricity has historically risen at a rate of about 3% per year. In many areas in the northeast, electric rates have increased much as 23% in recent years. As rates increase, PV systems become more valuable, resulting in a reduced amount of time to break even and increased property values.

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