January 2012

What You Need To Know When Shopping For a Home Solar System

By Scott Gordon
SVP, Sales, HelioPower

I consider myself among the lucky. I had the good fortune to land a job in solar sales way back in 2007. Back then, times were simpler. The majority of my customers paid for their systems with cash or HELOCS (home equity lines of credit). PPAs (power purchase agreements) and leases were the realm of multi-megawatt commercial and utility installations and nothing of the sort was available for residential consumers.

In the “earlier” days of solar savvy customers compared solar purchases by comparing price per watt. Price per what?

Price Per Watt
Price per watt simply tells you how many dollars you are spending to buy a “watt” of solar power. Think of it this way: if your home requires a 6 kilowatt (KW) solar power system (6000 watts) and you pay $42,000 to have one installed, you’ve paid $7/watt. If on the other hand, if you spent $12/watt the same system would’ve cost you a whopping $72,000! Yes, the same system! Today’s solar leasing products allow some dealers to mask dramatic price differences, such as these, behind “low monthly payments.”

The chart here illustrates the range of prices paid by customers in Southern California Edison (SCE) territory according to CSI (California Solar Initiative).  This data was compiled by a third party, RunOnSun in Pasadena, CA.

In 2007 charts like this weren’t publicly available, so homeowners really had no way to verify whether they were getting a bad, good, or great deal on a solar system unless they compared 4 to 6 bids. Still price/watt held an important place in the conversation between solar buyer and solar dealer. By 2009, “What’s your price/watt?” was often one of the first questions my customers would ask me. By then, price/watt was solar’s APR (annual percentage rate used to compare bank loans).  It’s how you knew you were getting a good deal after you settled on equipment and installation.

Today, the subject of price/watt has all but vanished from the dialog. Why? The advent of now readily available leasing and residential PPA programs allow for the selling of solar systems using ‘savings per month’ in place of price per watt. This approach allows unscrupulous dealers to mask high, some might say, outrageous prices from their customers. Does it matter what your paying if you’re saving money every month? Of course it does.

Don’t get me wrong. There are many reputable dealers who help their customers to go solar through leasing and PPAs, and there’s nothing inherently wrong with either choice, but when dealers mask high prices in leases, consumers end up holding the bag.

This type of thing may have already happened to you if you’ve ever leased a car. Savvy buyers know to negotiate the price of the car before they choose how to finance it and then check the contract numbers carefully to make sure there’s nothing funny going on. Naïve buyers walk into a car dealership and fall for the “What kinda payment are you looking for on this baby?” line. If that’s you, keep reading.

Today, we see the similar tactics infiltrating the solar industry. You go online, get a quote, and you get excited because the solar company you contacted can save you $50/month on your electric bill with their exciting new lease! So you call them up, they dispatch a salesman, and just like that you’ve gone solar. Does it really matter what you paid? After all, you’re saving $50/month, right?

Let’s say the system that saves you $50 cost you $12/watt. If you leased a 6KW system you’re on the hook for $72,000. That same system for $6/watt would’ve saved you $100/month and cost $36,000. Big difference! Which system would you lease? The savvy buyer would’ve asked how much the system cost; how much power they were getting; and compared multiple bids. Such a buyer would by enjoying both significantly higher savings and a much faster ROI (if he put money down).

Questions for Your Solar Contractor
As I mentioned, price/watt is solar’s APR. When considering solar for your home, you need to ask your solar contractor two questions:

1. What is the cost of the system?
2. How many watts am I getting for that cost?

After you have your answer, you take the cost; divide by watts; and just like that you’ve mastered the art of price/watt and are a master solar shopper (well almost, look for my upcoming article Solar Lease Red Flags to become an even savvier solar shopper).

With price/watt in hand, you now know whether you’re getting a good value or being taken to the cleaners. Savings per month is a great way to determine the impact solar will have on your bank account, but a terrible way to shop for it. Price per watt is the great equalizer. Now that you have the power of price/watt to guide your decision, you can shop more confidently for your new home solar  system.

You can reach Scott Gordon directly at SGordon@HelioPower.com.

The Maplewood Homes Community, a development of The Housing Authority of the County of San Bernardino (HACSB), has received this year’s Novogradac Journal of Tax Credits “Development of Distinction” award for outstanding achievement in the Renewable Energy category.  The project was designed and constructed by HelioPower, an integrated energy solutions company based in California.

The Developments of Distinction Awards were established as an annual event to recognize excellence and outstanding achievement in the development of tax credit projects using the low-income housing tax credit (LIHTC), historic tax credit (HTC), renewable energy tax credit (RETC), Section 1602 Exchange Program grant funds and/or tax credit projects using U.S. Department of Housing and Urban Development (HUD) program financing.

Past winners in the category include the Coastal Community Action Program of Aberdeen, Washington, and its Coastal Energy Project, a 6 megawatt wind development near the Washington coastline in Grayland, Washington.  Honorable mention in 2010 went to Make It Right – SOLAR, a subsidiary of the Make It Right Foundation, founded by actor Brad Pitt, which serves as a renewable energy developer focused on affordable housing. MIR-Solar has completed more than 40 residential solar panel installations in New Orleans’ historic Lower 9^th Ward.

Maplewood Homes, an almost 70 year old affordable housing site with 296 units in the city of San Bernardino, California, is being honored for

View of Rooftops with Solar Panels installed by HelioPower at Maplewood Homes

HACSB’s use of the U.S. renewable energy 1603 tax credit. The Housing Authority’s collaborated with HelioPower to apply the credit and California Solar Initiative grant money to reduce the community’s energy costs, create jobs, educate tenants, and foster an environmentally green community.

In 2010, the HACSB received a $1.84 million grant from Southern California Edison’s Multifamily Affordable Solar Housing (MASH) Track 2 program – the largest program grant awarded. The Housing Authority worked with HelioPower to design, develop, engineer, and construct a 302 kilowatt solar photovoltaic facility, a system that is among the largest and most innovative roof mounted solar projects in San Bernardino. The project consisted of 1,288 solar panels atop 100 units. 85% of its production will benefit residents directly and 15% will offset common area energy load, with the savings directed to help fund on-site employment. The solar facility will offset over 1500 kilowatt hours (kWh) per unit annually, reducing resident’s energy bills on average by 30% or $166/unit/year.

HACSB is monetizing the savings from the green energy generated on the common area meters and channeling those funds into the green job

HelioPower solar crew at Maplewood Homes, San Bernardino, CA

training programs now underway. HelioPower trained and hired two residents and one community member giving them the opportunity to learn a new trade and gain solar industry expertise. HelioPower also conducted workshops for residents of Maplewood Homes about the benefits of solar and energy efficiency, how it works, what it means for them, and other tips on reducing wasteful energy and water consumption.

“This project is the first of many that the Housing Authority is pursuing to show commitment to implementing green initiatives to increase sustainability and save energy, and provide on-going employment opportunities for its residents in the growing green-building industry,” states Susan Benner, HACSB’s President/CEO.

The renewable energy honorable mention 2011 winner was the BioFuels Energy LLC project, which took a wasted, environmentally damaging resource, in this case methane gas being flared at the City of San Diego Point Loma Wastewater Treatment Facility, and built a system to convert it to renewable energy.

“Each year we gather to honor the best and the brightest in the tax credit industry, and each year I’m amazed at the caliber of so many deserving projects; this year’s winners truly are members of an elite group,” said Michael J. Novogradac, managing partner of Novogradac & Company LLP. “It is heartening that there are so many deserving housing, historic and renewable energy tax credit developments being built to serve residents in need and, more broadly, serve communities in which they are located. I congratulate this year’s winners and invite all with a housing, historic and renewable energy development to enter next year.”

Full descriptions of the 13 projects winning Developments of Distinction Awards are available at http://www.novoco.com/low_income_housing/dod_awards/2011/index.php.  A video presentation of the renewable energy winners is available at http://www.novoco.com/low_income_housing/dod_awards/2011/renewable_energy.php.

Source:  EcoOutfitters.net
Reporter:  Dawn Allcot

Final post in this series on Smart Meters and Solar by EcoOutfitters featuring Scott Gordon, Vice President of  Residential Sales for HelioPower.

In this, the final of our four-part series on smart meters and solar PV arrays (start here), we’re going to address one of three dangers HelioPower CEO Scott Gordon revealed to us about smart meters: How they are infringing on our privacy.

We’re going to assume that no one reading this is doing anything illegal in their homes that they want to hide. But Americans view privacy as one of our basic rights. While the right to privacy is not expressly outlined in the U.S. Constitution, the fourth amendment does guarantee us “privacy of the person and possessions as against unreasonable searches.”

Of course, our founding fathers never could have envisioned digital meters that can record and share every detail of our electric usage. (Mostly because they didn’t envision electricity!) But this is exactly what smart meters do. Why does the electric company want that information? On the surface, the utilities claim that they’re collecting this data in order to make us smarter consumers and conservationists. Armed with the knowledge of when, where, and how we use electricity, we are better able to reduce our usage and lower our electric bills.

In reality, there is a lot more they can do with the information. As Gordon explains: “Every time you use an electrical device, it draws a specific amount of power, different from other devices. The smart meter sees your life and the way you use electricity in 15-minute increments. It can see how many loads of laundry you do each week, when you’re home, when you leave, if you work from home, if you have a pool, how many refrigerators you have … I can literally build a profile of you and your life.”

Laws prohibit the electric company from sharing this information without your permission. But what if they offered you 20 percent off your bill to permit them to share the information with marketing partners? “Many people, in this economy, would take them up on it,” Gordon notes.

If you thought targeted Facebook ads were scary in a sort of “Big Brother is watching” sense, imagine this type of marketing going on across your home, through mail, email, cell phone — any avenue advertisers choose to reach you.

Protect Your Privacy with Solar
When you’re connected to a home solar PV array, your solar system is the only power signature the smart meter can read. All your other devices draw their power from the solar system. “Everything else is literally hiding behind a smokescreen that is your solar system,” Gordon explains.

For years, Gordon said, the driving factor behind installing a solar array has been to save money. “Saving the environment and being eco-conscious is nice, but for the most part, people are concerned about lowering their electric bills.”

Now, smart meters introduce a whole new reason to go solar. For 10 to 16 hours of the day, depending on the time of year, your solar PV array is supporting your right to privacy. (Read more in HelioPower’s 10 Things About Smart Meters and Solar.)