Secret to me, until now: Time of Use Rates
The adventures of installing rooftop solar panels on an existing home
There is much to learn! Like Time of Use rates.
Since I posted “Part One” I have had my roof inspected by the solar provider. One cracked tile was found, which they will replace, and they report “the felt is good.” They took photos of all aspects of the roof. I suppose I should get a copy of those. [Advice: ask for anything special as soon as possible, preferably before signing the contract. I requested photos after the fact and was ignored.]
They say they will be providing a 25-year warranty on my roof. That protects against leaks from the points at which they attach their panels to my roof.
Meanwhile I’ve been refining the numbers on my spreadsheet. Savings each month will vary according to how much solar is used and how much is taken from the grid. It is not simply the total generated minus the total used, because I only get a credit of 75% retail from the utility. (This varies greatly from place to place.) So the more I use solar instead of the grid, the less I pay. I can calculate a maximum savings (all solar used, none sent to the grid) and a minimum (no solar used, all sent to the grid). For projections, I’ll use a figure midway between those two points.
Solar is not a substitute for conservation.
Solar panels on your roof does not mean you should use electricity with abandon. In fact, you should be conserving energy whether or not you go solar. You may find you save so much money by conserving that adding solar panels is unnecessary or not cost-effective. You need to compare the cost of solar versus your energy use AFTER employing conservation measures, not before.
Change all your non-LED light bulbs.
LEDs use about 1/10 the amount of electricity as old-fashioned incandescent bulbs. They last much longer, and the payback on replacing old bulbs is only a year or two. Your local utility may even provide some new light bulbs for free.
Turn off outdoor lighting during the day.
You can use LED light bulbs that turn themselves on when it’s dark. Be sure to get the dark yellow ones that don’t screw up the insects and birds. Ordinary LED bulbs may be screwed into sockets that are only on in the dark. Your local utility may provide some of these for free or at a substanial discount.
Use smart outlets.
Many appliances use electricity even when they are off. Shut them down as much as you can. For instance, kitchen appliances may be plugged into smart outlets that automatically turn themselves off overnight or during peak hours when electricity rates are higher.
Seal doors and windows.
Plug up the cracks that allow cooled or heated air to escape.
Replace old appliances.
Refrigerators, dryers, hot water heaters and air conditioners that are over 10 years old are probably wasting energy. Your local utility may provide replacements for free or a substanial discount.
Install a “smart” thermostat.
Something like the “Nest” can reduce your electic usage by identifying times when you can be cooler or warmer. You can set it up to “pre-cool” your house on hot summer days, so you use less energy during peak times. Your local utility may provide a smart thermostat for free or a substanial discount.
Time of Use Rates
My research led me to something called “Time of Use Rates“. This is a plan that might provide savings to almost anyone, but especially for those with solar panels and a bit of discipline. Or it might be a total loser for those who’d rather not think about how/when they use energy. I’m going to give it a try, and I’m told I can cancel after 12 months and get a refund for any overage. All I had to do was notify NV Energy that I’d like to try those rates.
Basically they charge more (3 times as much, about $0.35/kWh!) for energy from the grid 1pm-7pm during summer weekdays. At all other times (nights, weekends, wintertime) I pay about half the standard rate, $0.06/kWh. Sounds like if I’m willing to sweat a little during the summer weekday afternoons, I can cool things off at night while saving money, perhaps 25-30% of my bill even without solar.
While I pay lower rates during non-peak hours, I also get paid less for solar fed to the grid. That means the credit I accrue in the wintertime (in Nevada) yields less for me to apply against high electricity costs in summertime, when I’m using my air conditioning a lot. I think it will work out if I can strictly limit use of air conditioning during the daytime peaks. Then I’ll be gathering high credits for my excess solar, and paying for all the heavy usage at night. My hope is to avoid paying anything for electricity, which might save hundreds of dollars in summer months. That might be more difficult without TOU rates.
Shift your usage!
In summer, TOU rates from 1pm-7pm (depending on your utility) may be outrageous. Avoid using appliances and air conditioning during peak. Dinnertime should be after peak to avoid using cooking appliances during peak. No dishwasher, washer, dryer etc. Pre-cool the house down to 75° or lower during the hour or two before peak, then turn the thermostat up to 81° or higher until non-peak rates. Today it was 106°. From 1pm to 4pm the inside temperature drifted up from 75 to 81 and the aircon kicked back on. It didn’t take much to keep it below 81 from 4 to 7. Once beyond the peak time, set cooling for comfort all night.
In wintertime, when TOU rates are low all day long, shift appliance usage to the time when your solar panels are producing the most, 10am-3pm. For instance, start your dishwasher at 10am. Start laundry at noon. If baking in an electric oven, start that before 2pm.
Of course your peak rate times may differ from mine, but the basic concepts apply.
At this time it looks like TOU rates might cut $30-60 off my monthly bill, but may be even more beneficial once I switch on the solar.
My solar rep never mentioned “Time of Use”, probably because it might reduce my existing electric bills, thus reducing the cost-effectiveness of installing solar panels. When I asked him about it, he replied, “I think that is a great idea for everyone who has a solar system on their roof.”
In California, solar users who employ “net metering” to sell power to the grid must also adhere to “Time of Use” rates. There’s an article at Energy Sage but I can’t vouch for its accuracy, nor the comments.
Compare solar to what your electric bill should be, not what it is.
If you reduce your electric usage through conservation, you will need a smaller, less expensive solar panel setup. This affects costs and payback.
If you lower your bills by adopting better rate plans, it may be more difficult to justify investment in solar.
Don’t skimp on capacity.
Your objective is to produce as much electricity each year as you use. If your system produces too much, you’ve paid for capacity that has a relatively poor payback. Too little and you wind up shoveling too much cash back to the utility. Given the basic costs of designing and installing the system, don’t skimp on capacity.
Some solar contractors may low-ball your system capacity in order to provide an attractive price. 80% of use seems to be their sweet spot, but this is detrimental to your long-term payback.
Get an inverter that matches your panels’ capacity
The “inverter” is one of the more expensive parts of the system. It converts the DC power from your panels into AC power for your home (or to sell to the grid.) If you have 7.2kWp capacity in your panels, you don’t want an inverter limited to 5.6kWp. You want a more capable, more expensive inverter that is matched to your panels, including perhaps a few extra kWp if you decide later to expand.
Rough Draft of my spreadsheet. Click “Assumptions” tab after opening.