A few weeks ago, we received a comment on our Facebook page (have you “liked” us?) that seems to sum up what a lot of people think about solar at home—that it would be great because of the environmental and energy security benefits, but who can afford it? While it still is an investment in a home, today’s lowered costs have broadened the appeal of installing a photovoltaic system. In fact, a recent study conducted in California found that 62 percent of new residential solar systems are being installed on middle-income homes. Many of the homeowners we have helped go solar reflect this trend as well.
For a variety of reasons the cost of photovoltaic panels has dropped over the last year or so, and as a result the average system costs have come down a lot, too. Today, the average upfront investment after incentives is around $15,000. Factoring in the avoided cost of utilities for the next 25 years, which have historically increased at approximately 5 percent per year, gives a clearer idea of when a system will “pay for itself.” In many cases, it works out to fewer than ten years, which gives homeowners fifteen years or more to enjoy free solar energy.
Some have compared the purchase of a solar array with that of a car. There are some similarities, but one huge difference—once the array is paid off, the owner will still have many years of worry-free use. With a car, you will continue to pay increasingly for maintenance long after you own it. Since most solar systems are warranted for 25 years and provide residual value from avoided costs of energy among other financial benefits, solar is low risk and a great return on investment. And, with rising costs of electricity, it’s worth looking into…now.
First of all, we have to commend President Obama for even mentioning solar energy in Tuesday’s State of the Union speech. Considering that the post-Solyndra political landscape for solar is anything but friendly (read my take in the op-ed I wrote for The Washington Post), it can only be good news that the President isn’t backing down on clean energy. He’s still on board, and for that, we’re certainly grateful. In his address, he asked Congress to establish a “clean energy standard” for the nation’s utility companies. Given that this kind of standard is already on the books in most industrialized nations, it’s not an outlandish idea, and one that would certainly benefit renewable energy.
However, what is unclear is exactly what would count as clean. Most likely, nuclear, natural gas and maybe even cleaner coal plants would qualify, which would dilute the positive effects on greenhouse gas emissions that an increase in renewable energy would provide. We would urge lawmakers to consider giving renewables (solar, wind and geothermal) a significant advantage in any legislation regarding clean energy.
Another point that we were happy to see made was that the time has come to end taxpayer subsidies to oil companies. The oil and gas industry still enjoys these incentives long after the need for them has passed. As President Obama urged, it’s time to “doubledown on a clean energy industry that never has been more promising.” An analysis in 2009 by the Union of Concerned Scientists found that we could create 300,000 new jobs if the US produces just 25 percent of the nation’s electricity with renewables by 2025. This kind of job growth just is not present in the oil industry.
One thing the President made clear; it is time to invest in solar energy. He won’t back down, and neither should we.
- Tony Clifford, Standard Solar CEO
The National Press Club Newsmakers Committee hosted this morning a panel of U.S. solar industry leaders to discuss the importance of the Treasury Department’s 1603 Grant Program.
Shayle Kann of GTM Research unveiled results from the quarterly “U.S. Solar Market Insight” report, which detailed the U.S. solar industry’s growth through Q3, 2011 – the best quarter ever for the U.S. solar industry. Rhone Resch, president and CEO of the Solar Energy Industry Association; Tony Clifford, chief executive officer of Standard Solar and Joe Desmond, SVP, BrightSource Energy participated in the panel discussion which was hosted and moderated by Bracewell Giuliani energy expert Frank Maisano who is a member of the club’s Newsmakers Committee.