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Originally Posted by redpoint5
My bill shows a fixed cost of $11/mo, and assume it's the same for you ($10 is close enough too). Subtract that out of your yearly cost, and divide it by 5840 kWh consumed, and you end up with $0.15/kWh, which is quite a bit higher than 11 cents.
Anyhow, assuming your 11 cent per kWh and an annual electrical production of 5769 kWh, that is $635, not $900. 15 year payback.
If your actual rate is $0.15/kWh, that is $877/yr. Almost 11 year payback.
So my assumptions weren't way off from what you're saying.
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My rounding does move the numbers a bit. It was more of a back-of-the-napkin calculation.
10 or 15 year payback - at that point the projections are based on things we can't know today. What we do know is that today solar easily pays back the cost within the life of the system. So long term there is a savings and it is a hedge against future rate inflation.
Quote:
Originally Posted by redpoint5
Taking the average rate of return of the stock market of 7%, the money invested rather than put into solar would have doubled in 11 years. Due to compounding interest, there is no catching up with the savings from solar unless electricity prices skyrocket for some reason.
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The average rate of return on the stock market is 7%
The average annual increase in electricity rates is 4%
So now we are down to 3%. The stock market returns are taxed at a capital gains rate of 15-20%. Money saved on electricity is tax fee. So that is another 1 to 1.5%. At that point the question is do you want to lock in a fixed rate of return or roll the dice to get another 1 - 1.5 percent?
I get what you are saying about opportunity cost. That is why we didn't do the install this year. We decided we wanted to pick up a rental house so we are saving the down payment this year. Solar is only getting cheaper and we want to have cash in hand - ready to buy - when the next recession hits.
Quote:
Originally Posted by redpoint5
I like solar, but the PNW isn't a great place for it. If I lived in HI and paid $0.33/kWh, I'd have gone solar long ago. Heck, if I lived in Phoenix, I'd probably go for it.
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I agree, the PNW isn't a great place for solar. It is only a good place for it.