Calling All DIY'ers....What is Your Cost of Production?

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  • DanS26
    Solar Fanatic
    • Dec 2011
    • 976

    Calling All DIY'ers....What is Your Cost of Production?

    I'd really like to know how low some of you really handy DIY'ers can go with their grid tied solar installations. But I'm only interested in only one metric..."cost of production".

    This is how its calculated:

    1. Determine your net cash outlay for equipment and outside labor. Net includes any offsetting rebates and incentives you received in cash from local, state or federal entities. But on the other hand include future maintenance costs and inverter replacements over a 25 year period.

    2. Determine your total kWh production over a 25 year period. You can do this by using the PV Watts tool. Derate your system by .0071% a year for panel efficiency loss (ie ~3/4 of one percent).

    3. 1. divided by 2. equals "cost of production" in cents per kWh.

    Great metric everyone should know about their system. For you guys that finance or lease, the calculations are a little more involved since you have to use present value analysis, but it can be done.

    What say you......
  • J.P.M.
    Solar Fanatic
    • Aug 2013
    • 14939

    #2
    Originally posted by DanS26
    I'd really like to know how low some of you really handy DIY'ers can go with their grid tied solar installations. But I'm only interested in only one metric..."cost of production".

    This is how its calculated:

    1. Determine your net cash outlay for equipment and outside labor. Net includes any offsetting rebates and incentives you received in cash from local, state or federal entities. But on the other hand include future maintenance costs and inverter replacements over a 25 year period.

    2. Determine your total kWh production over a 25 year period. You can do this by using the PV Watts tool.

    3. 1. divided by 2. equals "cost of production" in cents per kWh.

    Great metric everyone should know about their system. For you guys that finance or lease, the calculations are a little more involved since you have to use present value analysis, but it can be done.

    What say you......
    Does # 2 above include year/year anticipated/actual production decline due to panel/system aging ?

    Comment

    • DanS26
      Solar Fanatic
      • Dec 2011
      • 976

      #3
      Originally posted by J.P.M.
      Does # 2 above include year/year anticipated/actual production decline due to panel/system aging ?
      Yes, lets say .0071% a year derate.

      Comment

      • sensij
        Solar Fanatic
        • Sep 2014
        • 5074

        #4
        Maybe you mean 0.7%? I agree this can be a useful calculation, and my own much less succinct explanation of it can be found in a thread a month or two ago (probably not worth linking here). What are you hoping to learn? Why limit it to DIY? Perhaps if you go first with an example of the calculations on your own system, it will encourage more responses.
        CS6P-260P/SE3000 - http://tiny.cc/ed5ozx

        Comment

        • DanS26
          Solar Fanatic
          • Dec 2011
          • 976

          #5
          Originally posted by sensij
          Maybe you mean 0.7%? I agree this can be a useful calculation, and my own much less succinct explanation of it can be found in a thread a month or two ago (probably not worth linking here). What are you hoping to learn? Why limit it to DIY? Perhaps if you go first with an example of the calculations on your own system, it will encourage more responses.
          Well yes, it a derate of 3/4 of one percent per year.

          I want to learn how close we are coming to parity with fossil fuel generation. Here in the Midwest the big coal plants produce at ~2.5 to 3.0 cents per kWh. But then they have to transport it to their customers and add administration charges, etc. So to make a profit they add demand charges, etc and sell their production at around 6.5 to 7.5 cents a kWh.

          If a DIY'er can build a system and produce at around 6.5 to 7.0 cents a kWh then they are competitive.

          I produce at 5.8 cents a kWh. I did all the work myself. That is the reason I addressed the DIY'ers. At least in the midwest, if you have to pay someone to put in a solar system, you cannot compete with the big coal powered plants. Now if you are in states with these big solar incentives like CA and NJ then it really is not market comparable. IMHO, in the long run it's all going to come down to the low cost producers, just like most industries.

          I built my system two years ago and I know panel, inverter, mounting cost have come down since then. So, I'm just wondering how costs compare now.

          Comment

          • Sunking
            Solar Fanatic
            • Feb 2010
            • 23301

            #6
            What do you do when there is no sun, winter comes, and night falls?
            MSEE, PE

            Comment

            • sdold
              Moderator
              • Jun 2014
              • 1430

              #7
              5.3 cents

              Comment

              • DanS26
                Solar Fanatic
                • Dec 2011
                • 976

                #8
                Originally posted by Sunking
                What do you do when there is no sun, winter comes, and night falls?
                Right now I use the grid as my battery bank and I pay $37 a month for that privilege.

                The best minds in the world are working on a solution so I don't have to rely on the grid for that capability. I sincerely hope they are quick about it. Go Elon and all your minions........

                Comment

                • DanS26
                  Solar Fanatic
                  • Dec 2011
                  • 976

                  #9
                  We have have a few posts on this site, especially from knowledgeable individuals, that tell newbies that solar is a bad investment. That is true if you go about it without a good understanding of the costs and returns.

                  I'd like to tell the true DIY'ers that solar is viable.

                  If you have to pay someone to do the research and implementation of what you want to do, solar wise, then yes it can be a bad investment and a waste of your money. If you have to depend on the government to make your project a reality then wait and wait and wait........

                  I'm convinced that there are a lot of handy guys out there that can do it. It is not rocket science, but you do have to educate yourself and understand electrical theory and especially the NEC code.

                  I know the trade guys do not like DIY'ers and their unions lobby the state legislatures for privileges. I can understand that, there is a lot of hack work out there. But really all these barriers do nothing but create additional costs to the solar industry.

                  I see a lot of DIY guys come on this site and get discouraged. Just because a project is complicated does not mean you should be intimidated by it. My advice is if you can turn a torque wrench, read a multimeter, drive a nail, scale a ladder, shoot a line, set a level, understand the NEC, then you can build your own solar system and get it approved from your local POCO and AHJ.

                  Comment

                  • Sunking
                    Solar Fanatic
                    • Feb 2010
                    • 23301

                    #10
                    Originally posted by DanS26
                    The best minds in the world are working on a solution so I don't have to rely on the grid for that capability. I sincerely hope they are quick about it. Go Elon and all your minions........
                    130 years of waiting so far without much improvement.
                    MSEE, PE

                    Comment

                    • CA_Tom
                      Member
                      • Oct 2014
                      • 87

                      #11
                      Originally posted by DanS26
                      I'd really like to know how low some of you really handy DIY'ers can go with their grid tied solar installations. But I'm only interested in only one metric..."cost of production".

                      This is how its calculated:

                      1. Determine your net cash outlay for equipment and outside labor. Net includes any offsetting rebates and incentives you received in cash from local, state or federal entities. But on the other hand include future maintenance costs and inverter replacements over a 25 year period.
                      I think this makes the figures misleading.
                      My un-subsidized initial cost will be ~$18,200.
                      My net outlay will be ~$4100 ($6100 if I include $2K for maintenance over 25 years)

                      2. Determine your total kWh production over a 25 year period. You can do this by using the PV Watts tool. Derate your system by .0071% a year for panel efficiency loss (ie ~3/4 of one percent).

                      3. 1. divided by 2. equals "cost of production" in cents per kWh.

                      Great metric everyone should know about their system. For you guys that finance or lease, the calculations are a little more involved since you have to use present value analysis, but it can be done.

                      What say you......
                      Power generation is estimated to be ~10300 kwh/year

                      So $6100/235604kwh = $0.0259/kwh

                      Lower if I have better power than estimated. (I'm trying to be slightly pessimistic)

                      Higher if I have equipment failures (inverter, panel, power-edge optimizers, etc.)

                      Comment

                      • sdold
                        Moderator
                        • Jun 2014
                        • 1430

                        #12
                        Why is your net cost so low? Does your city or county have incentives? I only have the federal 30%

                        Comment

                        • DanS26
                          Solar Fanatic
                          • Dec 2011
                          • 976

                          #13
                          Originally posted by CA_Tom
                          I think this makes the figures misleading.
                          My un-subsidized initial cost will be ~$18,200.
                          My net outlay will be ~$4100 ($6100 if I include $2K for maintenance over 25 years)



                          Power generation is estimated to be ~10300 kwh/year

                          So $6100/235604kwh = $0.0259/kwh

                          Lower if I have better power than estimated. (I'm trying to be slightly pessimistic)

                          Higher if I have equipment failures (inverter, panel, power-edge optimizers, etc.)
                          Where are you getting $14,000 of subsidies? I know this is CA but really?

                          Comment

                          • DanS26
                            Solar Fanatic
                            • Dec 2011
                            • 976

                            #14
                            Originally posted by Sunking
                            130 years of waiting so far without much improvement.
                            I could be wrong, but my gut tells me the wait is not much longer.

                            Comment

                            • CA_Tom
                              Member
                              • Oct 2014
                              • 87

                              #15
                              Originally posted by DanS26
                              Where are you getting $14,000 of subsidies? I know this is CA but really?
                              Yes really.

                              From the electrical utility provider I get a rebate of $1.75 / "AC watt" (PTC wattage x inverter efficiency)
                              Wattage will be derated for shading as well.

                              And 30% off the remaining amount (Federal income tax credit that most people are already familiar with.)

                              With those, I expect it to be ~4 years for this to be a net gain to the household.

                              Rebate was approved in the past month - so I need to get the install done before too long. (I think it's a 1 year window)

                              Comment

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