3kW Grid Tied Solar PV: Watts and Warts.

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629 posts

Ultimate Geek

#1176007 14-Nov-2014 17:49

freemark: Just don't get into the industry anywhere near sales :)
Any industry in fact..imagine telling the guy who wants a new Porsche what he should be doing with his money instead.
But some people just want Solar PV, whatever the equation. Good on them.
Btw I have qualified my model here from the start IMO.

Wow, that's a really good reflection on the sales industry. Tell the customer what they want to hear and disregard anything else? Try running your model using a 3% cost of capital (assuming they have no mortgage). Doesn't look so good now does it? Then look at 6% (if they do have a mortgage) and it makes it terrible. Remembering that this assumes you use 100% of the power before it leaves your premises. Any injection to the grid and at the new rates you are even worse off. I have even used your 0.5% yearly output degradation suggested below.

freemark: And I'm interested in why you don't think 2% per year increase in retail electricity prices is in any way out of order. Some PV crowds use a figure of 3%, and a possibly more accurate .5% annual output drop...

I just think that trying to forecast the price of anything 10 let alone 30 years into the future is impossible. There is a very high chance there will be a step change at some time within the next 30 years of power generation that will make the investment a dead duck (distribution companies like the catchphrase "stranded asset"). But in saying that I do acknowledge it is probably the best thing you can do if you do want to try and analyse full life cycle payback.

Sorry if you are taking my scrutiny as a personal attack, it is not intended. Coming from a scientific background I am looking at it in a rather black and white way and I know not everyone thinks like that. But from a purely numbers perspective I just can't see how you can disregard the cost of capital when you are I just don't agree with the way you are analysing the investment decision.

freemark

103 posts

Master Geek

#1176060 14-Nov-2014 19:02

Ok, I'll advise them to leave the $15k in the bank. They could get a really good rate, say 6%. So that's after tax max $700 interest per year (which they can apply to the power bill). After 10 years worth of inflation the $15k has less purchasing power (15%?) while their power bills have gone up 10%.
So I'll continue to offer in good faith a solution that suits some people, you can apply your model to maybe a little wind, hydro, thermal or geothermal plant, and we'll see who get's their bills down.
Cheers

Porboynz

110 posts

Master Geek

#1176061 14-Nov-2014 19:04

Well I think both points of view have been well explored. Apart from the mega rich running spa and swimming pools in their air conditioned mansions perhaps dairy farmers are natural customers of solar PV as they need to keep a vat of milk chilled all day ready for the tanker pickup. The hotter the day the more refrigeration they need. I wonder what the power consumption is on average? Plus they need a lot of hot water. Hang on, now that I think about it I am describing the mega rich again.

richms

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#1176064 14-Nov-2014 19:14

I will get enough PV on the shed to cover my base load because that makes sense. Means I can do all the pool filtering during the day and possibly buy a second hot water cylinder to divert power too if there is an excess.

That does rely on a pool company actually getting back to me about doing the resurfacing.

Richard rich.ms

k1wi

484 posts

Ultimate Geek

#1176164 15-Nov-2014 05:12

freemark: Ok, I'll advise them to leave the $15k in the bank. They could get a really good rate, say 6%. So that's after tax max $700 interest per year (which they can apply to the power bill).

It's $700 in the first year, but increasingly more every year after that, and you still have the principle sum at the end of the 30 years.

The difficulty is that just like the wholesale price of power, which varies by minute and by region, or the supply cost of large producers (which varies by season and plant), there is not global price/KwH for solar that fits all individuals.

From a purely financial standpoint, you would probably be best to advise them to keep the 15k in the bank (or invest) and then purchase the solar setup in a couple of years time, when at current trends that 15k would buy twice the array that they could today. But then we're not financial advisers! I have said before in this thread, the biggest impediment to the uptake of solar power in the short term is the plummeting price of solar panels. Of course, in the long run it is the current rate of falling prices that is likely to lead to an upswing in uptake.

If extolling the financial benefits then there is an obligation to use the most complete/accurate model for calculating the total pecuniary costs, one that is flexible to take into account the client's unique factors. A model that took into account wholesale prices 30 years out should realistically consist of a range of scenarios. Personally I'd be pretty hesitant to model much more than a couple of years out maximum. There is way too much variance and too many what ifs - what if Labour had gotten into power and driven down the price through NZPower? What if national demand falls enough that the only grid power required is cheap hydro? What if emission taxes or fossil fuel prices push whole sale prices up at a much greater rate than present?

However, like pretty much anything, solar is more than purely pecuniary. The consumer determines their subjective benefits - a good, honest, salesman can accurately understand the customer and advise them on these subjective benefits and how they are likely to apply to them. I do imagine you are one of these guys so I'm probably preaching to the converted here.

Personally, if I had the 15,000, or even $5,000 to do solar I would, even if the financials didn't add up and for pretty much the same reasons as Porboynz. I am more than a little jealous of those that are able to! At best I have been able to really focus on reducing my household demand to 1.8KwH/day (excluding heating, which is gas here).

The analyst in me is absolutely captivated with how the electricity sector is going to shake out over the next thirty years. I consider myself lucky to be living in such a dynamic period, even if it makes it far more complicated for anyone with skin in the game. 2010-2040 is going to leave the 'reform years' of the 80s, 90s and 2000s looking positively static.

Porboynz

110 posts

Master Geek

#1176400 15-Nov-2014 18:30

1.8kWh per day is simply amazing. Don't you have PBTech/Harvey Norman/Jaycars etc where you live? I'm thinking no dishwasher, no wifi, no TV and nothing on standby, gas hot water, gas stove and oven and heating, LED lights, no freezer and a very efficient fridge and a huge amount of self control. My vacuum cleaner uses more than that. I am in awe.

1.8kWh per day is 54kWh in a 30 day month and assuming $0.28 per unit on the low user plan that's $15.12/m plus $0.38 per day low user lines fee another $11.40/m for a magnificent total $26.52 power bill. Imagine if you did have 1kW of PV on your roof, you could go crazy and iron your tea towels or something.

With a base load of 500W 24 x 7 my minimum is 360kWh per month compared with your 54kWh.

Officially Astonished.

k1wi

484 posts

Ultimate Geek

#1176604 16-Nov-2014 05:33

Heh, your assessment is pretty accurate.

We only have 2 light fittings without LEDs/CFLs and turning them on is beyond a last resort for me, less so for the wife but I do my best to discourage their use. We actually have a 200w projector for watching TV, which along with our fridge, this computer and our espresso machine probably account for a combined 80-85%. Having gas for heating and water is of course the main reducer, but even then I try and be as efficient with those as possible. We get a little bump in usage using window fans in summer. Actually, even though we're in a 3 bedroomer, not having kids is probably the biggest help.

We do have a vacuum but it's only used for one 3x4m rug - the rest of the floors are wooden ;)

SepticSceptic

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#1182091 24-Nov-2014 12:42

In the realm of alternative energy sources, an interesting side-note would be to investigate the decrease in owner-oocupied homes, and the rise of the transient, or permanent / almost permanent rental class. As the owner-occupier level falls, heading towards 50% or less in the foreseeable future, transients will not be in a position to install any kind of alternative energy solution.

My crystal ball shows a steady levelling off in the number of fixed solar, or other alternative energy sources pretty soon, unless the PV costs and storage technology makes a significant downwards tumble, at least in the order of a magnitude.

Or they become portable / semi portable. Then the building codes would have to allow some sort of plug in technology, irrespective of generating source. Thorium reactors anyone ? :-)

Porboynz

110 posts

Master Geek

#1182228 24-Nov-2014 16:24

SepticSceptic: In the realm of alternative energy sources, an interesting side-note would be to investigate the decrease in owner-oocupied homes, and the rise of the transient, or permanent / almost permanent rental class. As the owner-occupier level falls, heading towards 50% or less in the foreseeable future, transients will not be in a position to install any kind of alternative energy solution.

My crystal ball shows a steady levelling off in the number of fixed solar, or other alternative energy sources pretty soon, unless the PV costs and storage technology makes a significant downwards tumble, at least in the order of a magnitude.

Or they become portable / semi portable. Then the building codes would have to allow some sort of plug in technology, irrespective of generating source. Thorium reactors anyone ? :-)

I think the market is naturally limited to owner occupiers that plan on staying put for 10 years or more. My observation of rental accommodation is that even if the landlord provides a smoke detector the tenant will often not replace the battery, so imagine managing a solar situation.

richms

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#1182235 24-Nov-2014 16:48

With low buy back rates there is zero point putting solar onto a property that you dont live in.

If there was some way of distributed net metering that I could have power going into the grid at the rental, out of the grid at my house and only pay a small charge per kwh to move that power between the 2, then it would start to look attractive, but with needing to pay a second lines charge and only getting peanuts per kwh its not viable unless its going onto the same power account that the tennants are using power from. And good luck getting them to pay more to you because they will pay less for power if they choose to use it right.

Richard rich.ms

SepticSceptic

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#1182262 24-Nov-2014 17:11

richms: With low buy back rates there is zero point putting solar onto a property that you dont live in.

That's the thing - the whole alternative energy movement falls down when you exclude 50% of residences. Alternative energy penetration will never exceed 50% ( and falling) of potential residential customers.

And not just PV - any kind of alternative energy.

With some tenants, you get a good buy in, for for the majority, pah ... they can't even cope with smoke detectors.

Mark

1653 posts

Uber Geek

#1182291 24-Nov-2014 17:50

Porboynz: 1.8kWh per day is simply amazing. Don't you have PBTech/Harvey Norman/Jaycars etc where you live? I'm thinking no dishwasher, no wifi, no TV and nothing on standby, gas hot water, gas stove and oven and heating, LED lights, no freezer and a very efficient fridge and a huge amount of self control. My vacuum cleaner uses more than that. I am in awe.

1.8kWh per day is 54kWh in a 30 day month and assuming $0.28 per unit on the low user plan that's $15.12/m plus $0.38 per day low user lines fee another $11.40/m for a magnificent total $26.52 power bill. Imagine if you did have 1kW of PV on your roof, you could go crazy and iron your tea towels or something.

With a base load of 500W 24 x 7 my minimum is 360kWh per month compared with your 54kWh.

Officially Astonished.

1.8KWh a day is scarily frugal! :-)

I've a tenant who uses 5KWh a day which I thought was impressive!

I've a house the complete opposite, wife and kids churn through power despite my best efforts of installing low power devices and lighting.

Last 30 days the house used 630kWh
Solar+battery provided 336kWh of that
And I exported 185kWh

For me the savings of power via solar is almost secondary to me having a house all powered up despite what the weather does to the local grid :-) And we've had quite a few outages this year.

richms

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#1182345 24-Nov-2014 19:25

SepticSceptic:

That's the thing - the whole alternative energy movement falls down when you exclude 50% of residences. Alternative energy penetration will never exceed 50% ( and falling) of potential residential customers.

And not just PV - any kind of alternative energy.

Actually it works better since there will still be people to sell power to in the daylight hours.

Richard rich.ms

timmmay

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#1190115 7-Dec-2014 12:32

Interesting article here on slashdot - basically says mount your solar panels so it delivers the most power at the time you need it, not the most power overall. This is probably true if you don't have storage and have a low buyback rate for excess capacity.

Porboynz

110 posts

Master Geek

#1248046 27-Feb-2015 20:07

Well today the letter from Meridian arrived advising a reduction in export tariff rates. While I was expecting it I still found the wording a laughable corporate spin exercise. Reproduced below for your general mirth:

The rates we pay you for your electricity generation are decreasing

We’ve recently reviewed the buyback rates we pay to customers who export their own electricity and

sell it back to us.

From 1 July 2015, your new buyback rates (excluding GST) will be:

7 cents per kWh in summer (1 October to 30 April)

10 cents per kWh in winter (1 May to 30 September).

Why are you changing the buyback rate?

The new rates are more closely aligned with prices we pay on the wholesale market. For more

information, visit meridian.co.nz/buybackrates

Why is the rate lower in summer when we export more?

When it’s warm and sunny there is generally a surplus of energy available. As a result the wholesale

price of electricity is lower on average in the summer months.

The different rates for summer and winter aim to encourage customers to export electricity in winter

when there is higher demand for electricity.

Questions about this letter?

Visit meridianenergy.co.nz/buybackrates

Email our Small-Scale Renewable Generation Team at service@meridian.co.nz

Call us on 0800 118 228 between 7.30am and 5.30pm Monday to Friday (excluding public

holidays).

Yours sincerely,

Jason McDonald

Head of Sales and Marketing

What a business they run, they buy for $0.07 per kWh and sell for $0.28 per kWh, such efficiency. I never expected the $0.25 per kWh to last but I had expected a more reasonable figure around the $0.18 mark as an encouragement to Renewable Energy and greenhouse gas. Foolish me, corporate profit is the driver ultimately. It does make you think about voting for the Greens, what future do our children have in a world of limited resources?

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