I hope the headline for this blog entry attracts some attention — because I’m frustrated about all the headlines on how solar is coming down in price.
Solar is coming down in price — BUT solar rebates are dropping, typically faster than the price of solar itself. That’s what’s happened here in Colorado in Xcel Energy territory.
This means from a consumer perspective, it seems as if solar prices are going UP! And, from a practical, out-of-pocket cost, perspective, they are!
I signed a contract with REC Residntial Solar (now part of SunRun) for our 5.59 kW home solar system here in Aurora, Colo. in August 2009.
At the time, Xcel — pushed by the Colorado Renewable Energy Ballot Initiative passed in 2007, which required big utilities produce 20 percent of their electricity via renewable energy by 2020 — was offering a direct rebate of $3.50 per watt of solar installed. This rebate, combined with a 30 percent Federal Tax Credit AND a $500 City of Aurora tax credit, brought down our out-of-pocket expenses for our system to $8,000, or $1.43 per watt — installed!
Four and a half years later, for personal reasons, I am seriously thinking of putting our home — with the solar system — up for sale, and looking for a new home to buy.
I love solar, though — and it might be the ONLY thing that keeps me in a house with not so great memories, that’s now in neighborhood dominated by two houses of constantly partying teens, is too far away from work for my tastes, and is now11 miles away from the school my two kids now attend.
Solar might keep me here at 4000 S. Atchison Way, or really, substantially higher out-of-pocket home solar costs than 5 years ago, might keep me here because I likely will not be able to afford to put a comparable system on a new home in 2015.
Yes, per watt un-subsidized solar costs — PRE-rebate/REC credit, etc. — have dropped for solar over the past 5 years. However, they’re now likely too high for me to purchase a system for a new home outright. I’d be forced to lease, which, after nearly five years of solar ownership — and one year of having a 2014 Nissan LEAF be fueled 100 percent by my home solar system.
I’d also like to eventually add a home battery storage system to a home solar system, and I have a feeling a solar lease would preclude this (though, I’m not sure).
So, there you have it, from a real-world, individual consumer perspective, home solar is more expensive to buy than it was five years ago!
To me, this indicates home solar still has a long way to go to become truly mainstream. It also means solar leasing has likely been a primary force behind continuing solar growth in Colorado, and elsewhere. Without leasing, you have to adjust your mindset to “pay your electric bill forward now to save in the (distant) future.” That’s a difficult mindset for most consumers to assume (for example, my soon-to-be ex-wife never could wrap her head around it).
However, the pay your electric bill forward to save in the long run mindset is a lot easier to have when you’re looking at a $8,000 out-of-pocket outlay than when you’re looking at a $21,000 outlay.