Solar Energy

From The San Diego Union Tribune, May 31, 2009, staff writer Onell R. Soto:  "Power to the people. One Block Off the Grid uses community activism to build networks of solar energy systems so homeowners can get volume discounts. "

Excerpts, for full article click here.

The renovation, the insulation and the new kitchen all helped, but Meg Goldfeather couldn't get her 1926 University Heights bungalow to save enough power.

She can't stand looking at her three-digit utility bills, knowing she could generate her own electricity using solar panels on her roof.

But cost has been an obstacle. So when Goldfeather's electrician suggested she look at something called One Block Off the Grid, she was interested.

“The minute I read it, I thought, this is absolutely it,” Goldfeather said. “Community effort, lower price.”

One Block Off the Grid, or 1bog.org, is a campaign that groups together people interested in buying solar power so they can get volume discounts. It is run by Virgance, a San Francisco company that uses activism campaigns to bring about social change while also making money.

After requesting proposals from local solar installers (in San Diego), Virgance enlisted groSolar and HelioPower, two companies whose prices – $6.09 a watt – impress longtime advocates of the technology.

“I might have to sign up,” said Bill Powers, an electrical engineer who is looking to expand his own solar energy system. He said many of the region's power problems, such as reliability and prices, would be alleviated if more people put the systems on their roofs.

Per watt, these installations would be less expensive than the massive systems installed on warehouse roofs just two years ago, in part because solar panel prices are dropping, Powers said.
The campaign now under way comes as a worldwide economic slump pushes solar panel prices down and government subsidies make systems more affordable.

A typical household system provides about 3,000 to 5,000 watts at peak production. Its size is determined by how much power a household uses in a month, with the goal being to replace the most expensive electricity.

Residential systems typically cost $7 to $9 per watt, said Irene Stillings, executive director of the Center for Sustainable Energy, which tracks state rebates for such installations.

By Scott Gordon, Director of Sales, HelioPower

If there were a most commonly asked question contest in the solar business, this question would win hands down: “How long will it take for my solar system to pay for itself?” (Incidentally the second most asked question is: “I have an XXX square foot house, how many solar panels do I need?”).

As you can imagine neither question is particularly easy to answer and both depend on the individual circumstances. If we start with the second question first, the answer is: “The number of panels you require, Mr. Customer, depends upon your 12 month electrical usage history, how your roof is configured, and the type of panels you choose to install.” In other words, without knowing the particulars of a customer’s situation, it’s impossible to answer what on the surface seems like a simple question.

Answering the first question (concerning solar payback) is more complicated because we need to establish a definition of ‘payback’ before we can adequately get to the nuts and bolts answer the customer is seeking.

Then we need to apply customer specific financials to make a final determination. In my experience as both a solar customer and salesman, I believe that there are three ways to think about a solar power system’s payback:

1. ROI – (Return on Investment) – This is what most customers think about. ROI determines how many years of energy savings are required for the solar power system to pay for itself.
2. IRR – (Internal Rate of Return) – Least considered payback methodology, IRR compares a solar ‘investment’ return to other conservative investment returns like interest paid by savings accounts, treasury bills & other bonds, certificates of deposit, etc.
3. Cash Flow – Can financing be obtained that generates positive cash flow for the customer? In other words, will the finance payment be less than the current electric bill? This is truly the Holy Grail.

Using my own solar power system as an example, I’ll address all three of these payback methodologies.

Gordon Residence, solar power in Laguna Beach, CA

1. ROI – My system (installed in February 2007) has an eight year ROI. It will take eight years of energy savings (compounded at 6.7% annually) before my system pays for itself.
2. IRR – That same system provides me with an IRR of 12%. I’m currently paying 4.2% on the money I borrowed to finance the system, so my ‘net return’ is 7.8% (way better than my savings, CDs, or bonds are paying me and certainly better than the 24 month return on my stock portfolio!).

3. Cash Flow – Most importantly, I’ve been cash flow positive from the FIRST MONTH. How? I swapped a $150-200/month electric bill for a $150/month Home Equity payment. Unlike my electric bill, the $150 HELOC payment was entirely tax deductable since it is 100% interest paid toward a qualifying home improvement.
Over the last two years, I’ve paid off a significant portion of the principle (which lowers the monthly payment) and had some luck on the interest rate front. Today, I am $110/month cash flow positive, yet my solar panel system won’t “pay for itself” for another six years!! Funny, because it’s paid me every single month since I installed it in 2007. As you can see, solar payback is truly a matter of perspective.

With the recent removal of the cap on the residential tax credit (Federal), IRR in some utilities is approaching 20%. Warren Buffet became a billionaire by averaging a 20% return over the course of his investing career. Bernie Madoff defrauded investors of billions by promising a 12% return.

A solar power system will provide you with a guaranteed conservative Buffett-like return, without making off with your money in Madoffesque fashion. Your exact return will ultimately be determined by your utility’s rebate level; your appetite for tax credits; and net system price.

If you can achieve positive cash flow with solar, your return from either/and ROI or IRR standpoint become less important. Cash is king, and the more of it you keep every month, the better off you’ll be in the long run. However you decide to calculate the payback on your solar panel system, remember, like any attractive investment, there is a cost to wait. Rebates are ticking down and utility rates keep going up. Every month you delay could cost you hundreds of dollars. Now that’s food for thought.

Tyler Michael is HelioPower’s resident expert for the application of solar in new home construction.  This week he is participating in the Urban Land Institute’s (ULI) Green Building Expo, a forum for sustainable building technologies, in San Diego.  The Green Building Expo is part of the ULI’s Smart Growth awards program and will be staged May 14 starting at 5:30 in the venerable Wonderhaus downtown.

The ULI provides leadership in the responsible use of land, and in creating and sustaining thriving communities worldwide. According to their website, as “the ‘go to’ land use organization for real estate issues in our region, the ULI San Diego/Tijuana District Council facilitates the open exchange of ideas among industry leaders, practitioners and policy makers.”

We asked Tyler about his interest in this region.

E. Tyler, are there special motivations that inspire you to be part of this San Diego Green Building Expo?
T. As a HelioPower specialist in solar for new construction, this event and the people and concepts that I encounter there are critical to my own growth and to my ability to contribute.

I believe that in San Diego/Tijuana we truly share a single urban landscape that is divided by a political line only.  We are in the same region with the same beauty and the same challenges.

We are interdependent in resources and in the conservation of those resources.  In my lifetime, I’ve seen Tijuana transform from just another “border town” to a thriving center of international commerce and I’ve seen San Diego transform from a quiet Navy town to a national force in research and technology. It seems only natural that we become an international leader in sustainability as well.

E. What in your background motivates your interest?
T. After moving to Chula Vista in 1952 and growing up within 7 miles of the Mexican border, I developed a real affinity for the bi-national mindset.

In my late teens, I became a true bi-lingual after studying Spanish for 8 years and hosting 26 Argentine foreign exchange students with others in my high school.

I’ve lived in Spain, Argentina, Ecuador, and nearly 14 years in Mexico. My time in Mexico and the lasting friendships I developed there have brought me a first hand awareness of the serious environmental sustainability practices being put into practice there.  My career in solar for new construction in San Diego has broadened my perspective on sustainability in general and in green building methods in particular.

E. Do you have a vision for the area?
T. The resources we share tie our destinies together. Recognition of those who have dedicated themselves to the careful preservation of those resources is both inspiring and necessary to bring forth the future leaders in this field who are poised to make their contribution.

For more information on the event, click here.

Wall Street Journal reporting April 24, 2009…Defying a global trend of weak solar demand, owners of homes and businesses in California installed a record 78 megawatts of solar panels in the first quarter of 2009, the California Public Utilities Commission said Friday.

While solar-panel prices have fallen 25% or more, on average, due to a global slowdown in demand, rooftop solar panels remain in high demand in California, the world's third-largest solar market, the CPUC data show.

The strength of California's solar market is due largely to generous state incentives, coupled with federal tax credits that greatly reduce the cost of installation and the fact that California has among the highest utility rates in the nation, making self-generated solar power competitive with conventional utility power, especially for large users.

The state is spending $3.3 billion to install 3,000 megawatts of solar panels over 10 years.

In a quarterly report on a solar rebate program it administers, the CPUC cited a recent change in the federal tax code that allows homeowners a larger tax credit for solar installations as a factor driving strength in that market.

Solar rebate applications filed with the CPUC in the first quarter hit a new quarterly record for capacity, at 52 megawatts, since the program started in January 2007, while the number of applications was down compared with the fourth quarter, the CPUC said.

To date, customers of utilities owned by PG&E Corp. (PCG), Edison International (EIX) and Sempra Energy (SRE) have installed 211 megawatts of new rooftop solar generation since 2007, the CPUC said. Statewide, California generates more than 500 megawatts of power from solar panels, the agency said.

The intent of the Legislature is that AB 811 should be used to finance the installation of distributed generation renewable energy sources or energy efficiency improvements that are permanently fixed to residential, commercial, industrial, or other real property.

AB 811 authorizes a property owner, upon written consent of an authorized city official, to purchase directly the related equipment and materials for the installation of distributed generation renewable energy sources or energy efficiency improvements and to contract directly for the installation of those sources or improvements. 

Funding options include using the general fund, issuing municipal bonds, partnering with a utility to get financing or setting up private financing.  

Palm Desert and Berkeley led the legislative charge to put AB 811 in place, and have now enabled hundreds of properties to be outfitted with energy efficiency and renewable energy systems including solar. The “Berkeley First” program was launched Nov. 07. Their pilot program is fully subscribed at $1.5 million.  The Palm Desert Energy Independence program is now in its third round of financing, having installed $7.5 million in energy efficiency and solar photovoltaic systems in their town.  

The Sonoma County Energy Independence program has completed a feasibility study and is planning on offering a $40 million program, which will also include water conservation systems.

San Diego is working on a “Solar Roof Program.” The pilot project will focus on 150 to 300 homes, and 1 technology – solar photovoltaic. Success for the pilot is deemed to be completing the financing cycle, collecting 150-200 loan packages, and aggregating those smaller loans into larger packages that can be sold off on the municipal bond market. Encinitas, Napa and Redlands are all in the exploration phase of AB 811 programs.

Cities like Anaheim and Santa Monica have solar supportive programs already in place.  Santa Monica promotes solar adoption through its Solar Santa Monica program.  Solar installation firms bid for program, and guarantee “group” pricing.  HelioPower is a installer for this program.   

All across California residents and property owners are working with their elected officials to find new and innovative ways to increase the use of sun to power our electricity needs. 

For further information and a review of the legislation, click here. Support AB 811 adoption in your town! 

This April 22 is the 39^th anniversary of Earth Day.  HelioPower, founded in 2001 with a dedication to bring solar to as many rooftops as possible, will participate in several CA and Nevada events. The HelioPower energy consultants will help homeowners and commercial property owners understand how solar power can help put more “green” in their pockets and do their part for the planet.

A bit of Earth Day history…

“First celebrated in 1970, Earth Day was spearheaded by a grassroots movement to shake up the political establishment and raise environmental awareness. Although planners had neither time nor resources to effectively organize the event, it took place across the nation with amazing results. An estimated 20 million demonstrators and thousand of schools and local communities participated.  The Earth Day founder, former U.S. Senator Gaylord Nelson, remembers, ‘That was the remarkable thing about Earth Day. It organized itself.’ That first Earth Day led to the creation of the United States Environmental Protection Agency and the passage of the Clean Air, Clean Water and Endangered Species Act.

The amazing energy associated with Earth Day propelled the movement forward, and in 1990 Earth Day went global, reminding us of our interconnectedness and mobilizing 200 million people in 41 countries, lifting environmental issues onto the world stage.  Today, huge climate changes impact everyone; the opportunity to raise awareness seems more important than ever.  Earth Day celebrations have a huge potential to impact change as more than a billion people participate in Earth Day each year.”

Source:  Claudia Abbott, “lastword,” a column in SOM Magazine

Dedicated HelioPower solar consultants will be at the following events.  Please join us in celebrating this 39^th Earth Day – 2009!

Tahoe / Reno

Tahoe Truckee Earth Day, Saturday, April 18, The Village at Squaw Valley

20/20 Earth Vision: Reno Earth Day Celebration, April 19, Idlewild Park,

Orange County, CA

Eco Fair 09, April 22, Cypress, CA

Earth Day Celebration at The Ecology Center, April 25, San Juan Capistrano

Coachella Valley, CA

Party for the Planet, April 25, The Living Desert

San Fernando Valley, CA

Earthfest Carnival 2009, April 25, St. Cyril of Jerusalem School

Residential solar panel installation in Encinitas, CA by HelioPower

Generous state and utility rebates and now the new Federal Incentive Tax Credit for renewable energy can lift up to 50% off the price of a solar power system for your home or business.  It has never been a better time to invest in a solar electricity system, thus greatly reducing or eliminating your electric bill altogether!

A solar electric or panel system sits atop your roof and generates electricity from the sun!  You use very limited amounts of electricity from your utility company. 

New Federal Tax Credits for buying a Solar Power System just increased to 30% with no cap for either residential or commercial systems. When you combine these AMT exempt Federal Tax Credits with State Rebates, you can save nearly 50% on a new system!

In these volatile economic times we continue to be faced with escalating electricity costs. When you invest in a solar power system your budget is insulated from continued electricity rate hikes. For example, starting in January 2009 SCE will increase your rates by 25% to 30% as a result of higher natural gas and transmission costs. This marks the third rate increase in just four years!

Additionally, a solar electric system will increase the value of your home or business. A recent study from the Appraisal Institute demonstrated that the selling price of homes increased by $20.73 for every $1.00 of decrease in annual utility bills. Using this math, a solar electric system often pays for itself the day it’s installed.

Call the HelioPower sales team at 1-87-SOLAR-888 to get a free on site analysis and customized quote for your rooftop solar power system. 

Marc Gunther, Senior Writer at Fortune Magazine, logged today's media article, "Why clean energy is still a good bet."

Despite falling oil prices and the credit crunch, green technology investors remain bullish.

Here is an excerpt from his excellent article, for the full piece click here.

Chico, CA retail building installation by HelioPower

(Fortune) — Some people are saying that the clean energy revolution is over, before it has even begun. "Alternative energy suddenly faces headwinds," declared The New York Times. "Winds shift for renewable energy as oil price sinks, money gets tight," reports The Wall Street Journal. "Will the Economic Crash Take Down Our Hopes for Clean Energy?" asks Alternet.

There's no doubt that recent developments cast a cloud over the renewable energy business. The capital markets have turned risk-averse, making financing for alternative energy hard to come by. Declining oil prices make it harder for cleaner transportation fuels to compete with gasoline. In a slumping economy, the government will be reluctant to pass climate change legislation that will raise gas and electricity rates.

Never mind – there are compelling reasons, even now, to believe that the U.S. is on the verge of a dramatic shift, away from a economy dependent on cheap fossil fuels and towards cleaner, greener, more efficient ways of doing business.

Recently, I spoke with three leading venture capitalists who focus on clean tech: William E. "Wilber" James of Rockport Capital, Alan Salzman of VantagePoint Venture Partners, and Paul Maeder of Highland Capital Partners. Needless to say, they are biased – they are invested, personally and professionally, in renewable energy and other clean technologies.

But they all see powerful forces driving the U.S. economy towards a more sustainable way of doing business in the long run. Those drivers include the science of climate change, rising global demand for a limited supply of fossil fuels, and growing political support for clean energy.

Residential Ground Mounted Solar Power system in Temecula, CA by HelioPower

In concert with the solar industry’s biggest U.S. event, Solar Power International 08, HelioEMS, Energy Management Solutions, and HelioPower have announced a joint promotion to assist California customers.  The promotion, which runs through the end of the year, involves both energy savings technologies and a $500 discount on any residential or commercial solar panel system installation.  Solar Power International 08 takes place in San Diego, October 13-17, 2008.

Energy evaluation and reduction is the initial step any company should take to improve energy efficiency.  All commercial clients who sign up for a solar power system during this promotion and/or at the show will receive a complimentary energy on site walk through of their facility with a HelioEMS team member. 

From HelioPower, residential and commercial clients who contract for a solar power system will receive a $500 discount off their system price and a check for $500 on any referrals they send that result in a new solar panel system being installed.

“This promotion could not have come at a better time,” said Steve LoRusso, Vice President of Sales at HelioPower.  “With the extension of the 30% Federal Income Tax Credit now in place and with the removal of the $2,000 cap from residential tax credits, that easily makes what was a good investment in solar an absolutely great investment!  With utility rates going up like a rocket, we just can’t wait to show our new customers why they need to take a look at what could be their best investment in a decade.  Even if you looked at solar previously, you need to re-visit this investment, as solar is now 30% more lucrative!”

The solar investment tax credit provisions in H.R. 1424, the Emergency Economic Stabilization Act of 2008, passed last week include:

• Extension for 8 years of the 30-percent tax credit for both residential and commercial solar installations
• Elimination of the $2,000 monetary cap for residential solar electric installations, creating a true 30-percent tax credit (effective for property placed in service after December 31, 2008)
• Allowance for Alternative Minimum Tax (AMT) filers, both businesses and individuals, to take the credit

These credits are in addition to local state, city and utility based rebates that vary according to each region. 

“We’re delighted to partner with HelioPower to insure commercial clients are utilizing energy efficiently, prior to investing in a solar photovoltaic (PV) system,” said TR Bietsch, Managing Director of HelioEMS, Energy Management Solutions. “An energy walk-through of their facility enables us to assist customers right away with ideas and suggestions to save money on their electric bill.” 

Keeton Construction, Temecula, CA by HelioPower

From the PR Newswire today, 9.15.08: "If Congress Passes Bill, 440,000 permanent jobs will be supported by the U.S. solar energy industry by 2016."