Solar Power. Talk to me.

malchior · Post by **malchior** » Fri Jun 27, 2014 1:57 pm

I'm still waiting on a site visit for my system - I was warned that I was pretty far back in the pipeline though. In the meantime I'm trying to get a quote on my roof - I knew it needed to be done when I bought the house so I am trying to get it before the system goes in. What I don't get with contractors is how a $8000-9000 job can just fall off their radar. I'm chasing 3 different ones for quotes and they all said 'this is a straightforward 1-day job'. Cool...price it out and let's just do it.

Zaxxon · Post by **Zaxxon** » Fri Jun 27, 2014 2:25 pm

RunningMn9 wrote:I don't understand why it would depress the value of the house when selling though. Having a 9.2 KW solar system on the roof that provides at least 75% of the electrical power to the house, at a rate that is significantly below what the utility is charging, that seems like a win for the buyer. Plus, if they want, they can in effect buy the solar system during the sale. If that's the route they want to go, then the value of the house is increased by whatever value would normally be added by having a 9.2 KW system on the roof, and I pay off the lease as part of the sale (well, technically I prepay all of the remaining payments - the lease company will still be responsible for maintaining and repairing the system for the remainder of the lease).

Well, if you pay off the lease and leave before using that electricity, then you're lowering your ROI. But what I was referring to is the fact that not all buyers want to deal with taking over a lease. If I was buying your place it sure wouldn't be a turnoff, but for a subset of buyers (Murica, fuck yeah!) it is. I wasn't sure whether this bias is a thing that exists, but in Denver it is, based on a Colorado Energy Office study of the actual market here that interviewed agents about their buyers'/sellers' experiences.

malchior wrote:I'm still waiting on a site visit for my system - I was warned that I was pretty far back in the pipeline though. In the meantime I'm trying to get a quote on my roof - I knew it needed to be done when I bought the house so I am trying to get it before the system goes in. What I don't get with contractors is how a $8000-9000 job can just fall off their radar. I'm chasing 3 different ones for quotes and they all said 'this is a straightforward 1-day job'. Cool...price it out and let's just do it.

That's nuts.

RunningMn9 · Post by **RunningMn9** » Fri Jun 27, 2014 2:37 pm

Zaxxon wrote:Well, if you pay off the lease and leave before using that electricity, then you're lowering your ROI. But what I was referring to is the fact that not all buyers want to deal with taking over a lease. If I was buying your place it sure wouldn't be a turnoff, but for a subset of buyers (Murica, fuck yeah!) it is. I wasn't sure whether this bias is a thing that exists, but in Denver it is, based on a Colorado Energy Office study of the actual market here that interviewed agents about their buyers'/sellers' experiences.

First - in this scenario, *I* am not paying off the lease. The buyer is paying off the lease because the value of the home is now being increased by the giant solar system on the roof. My ROI is maintained principally because I didn't put any money up for the system. There are no costs that I have to recoup.

Second - I can certainly understand that it would be a turnoff for some buyers. That only matters to me if it's a turnoff to ALL buyers. And even then, because the system is leased - I am far more likely to keep that in mind when I am house buying - and I can simply look for a house that meets the requirements for me to simply take the system with me.

But like I said - I'm not moving ever again.

Zaxxon · Post by **Zaxxon** » Fri Jun 27, 2014 2:59 pm

RunningMn9 wrote:
Zaxxon wrote:Well, if you pay off the lease and leave before using that electricity, then you're lowering your ROI. But what I was referring to is the fact that not all buyers want to deal with taking over a lease. If I was buying your place it sure wouldn't be a turnoff, but for a subset of buyers (Murica, fuck yeah!) it is. I wasn't sure whether this bias is a thing that exists, but in Denver it is, based on a Colorado Energy Office study of the actual market here that interviewed agents about their buyers'/sellers' experiences.
First - in this scenario, *I* am not paying off the lease. The buyer is paying off the lease because the value of the home is now being increased by the giant solar system on the roof. My ROI is maintained principally because I didn't put any money up for the system. There are no costs that I have to recoup.

What I'm saying is the value of your home will not rise as much if there is a lease on the system. If you pay it off and thereby your home value rises, you still took that hit--either you're paying for the lease in exchange for home value, or you're transferring the lease and getting less home value (because the buyer is paying the remainder of the lease as opposed to moving into a home with a paid-off system). Or you get a buyer who loves the system, wants to pay you a premium for it, and you have it all. My point is simply that in my market, at least, there's a demonstrable negative impact from a lease, and you are more likely to have to pay off the lease or take a hit on home value compared to your risk if you owned the system outright in the first place.

Second - I can certainly understand that it would be a turnoff for some buyers. That only matters to me if it's a turnoff to ALL buyers. And even then, because the system is leased - I am far more likely to keep that in mind when I am house buying - and I can simply look for a house that meets the requirements for me to simply take the system with me.

But like I said - I'm not moving ever again.

Well, you should care even if it's not all buyers, as reducing the competition/interest for your place can reduce your ultimate selling price or extend time on market. And unless you move in the next few years, you're not likely to want to take the system with you. That's used as a selling point for leases, but 1) your system will be worse than new systems at that time, which will also cost less, and 2) are you going to move to a home that has the same characteristics as yours so that your existing system is appropriately sized? It's unlikely, and if so, why are you moving? Will your new buyer who didn't want the system also be paying for the roof repairs after you yank the system off?

Since you're not moving, this is all moot. I respond mainly in case others are reading. For you specifically, it sounds to me like a lease is the better option.

RunningMn9 · Post by **RunningMn9** » Fri Jun 27, 2014 3:13 pm

Zaxxon wrote:What I'm saying is the value of your home will not rise as much if there is a lease on the system.

Absolutely. The value of the home should rise (to a much smaller degree) because electricity in my house will be much cheaper than the electricity of surrounding houses, but that's likely not a terribly large increase. I would guess that at most, it might help (or hinder) a tie between my house and a similar house without it.

Zaxxon wrote:If you pay it off and thereby your home value rises, you still took that hit

I'll repeat this one more time. I'm not paying it off. The sale price of the house is going to get bumped by the amount it takes to pre-pay the remainder of the lease. If it costs $10,000 to pay off the lease, and that's the route that the buyer wants to go, then the sale price of the house goes up $10,000. For the buyer, this isn't a bad deal. They are going to pre-pay the lease as part of their mortgage, but are going to save about $36,000 in electricity costs. Or they can assume the payments, leave their mortgage (and the purchase price) as is, and enjoy the remaining $23,000 in overall savings that the system will provide.

I'm not suggesting that right now - in your market (and maybe many more, up to all markets), having a solar lease creates a complication that might impact the ability to sell your house, or affect the value. That's not unexpected because solar leasing is a new thing, and people hate new things. Within a few years though, I expect it to be a much more common thing, and once (if) common opinion is established that solar leasing saves you money (even if it doesn't save you as much money as a fully owned system), I expect that to change.

Say in 10 years I have to move. I will have 10 years of data (month-by-month) demonstrating the value of the system.

At least that's what I tell myself.

Zaxxon · Post by **Zaxxon** » Fri Jun 27, 2014 3:19 pm

RunningMn9 wrote:I'll repeat this one more time. I'm not paying it off. The sale price of the house is going to get bumped by the amount it takes to pre-pay the remainder of the lease. If it costs $10,000 to pay off the lease, and that's the route that the buyer wants to go, then the sale price of the house goes up $10,000. For the buyer, this isn't a bad deal. They are going to pre-pay the lease as part of their mortgage, but are going to save about $36,000 in electricity costs. Or they can assume the payments, leave their mortgage (and the purchase price) as is, and enjoy the remaining $23,000 in overall savings that the system will provide.

Ah, I see the problem. You're thinking about home buying as though it's a rational process. Noted.

I'm not suggesting that right now - in your market (and maybe many more, up to all markets), having a solar lease creates a complication that might impact the ability to sell your house, or affect the value. That's not unexpected because solar leasing is a new thing, and people hate new things. Within a few years though, I expect it to be a much more common thing, and once (if) common opinion is established that solar leasing saves you money (even if it doesn't save you as much money as a fully owned system), I expect that to change.

Say in 10 years I have to move. I will have 10 years of data (month-by-month) demonstrating the value of the system.

At least that's what I tell myself.

I agree with all of this, and hope that you're proven right. In my case, I am likely to move in the next several years and that move may be a cross-country one in which I will be gunning for a short time on market. I therefore place a priority on things that have an outright positive, non-complicating impact on that process.

When does your installer anticipate firing up your system?

Side note: can I get just one day without a goddamn thunderstorm this week?

RunningMn9 · Post by **RunningMn9** » Fri Jun 27, 2014 4:19 pm

Zaxxon wrote:In my case, I am likely to move in the next several years

Shouldn't that have made you not shovel a pile of money into someone else's hands?

Zaxxon wrote:When does your installer anticipate firing up your system?

That will depend on the speed with which my County permitting machine can spring into action. Hopefully by December.

(the original estimate was 60 to 90 days, but it can be faster if the County operates like they are supposed to when it comes to permits and inspections).

Zaxxon · Post by **Zaxxon** » Fri Jun 27, 2014 4:21 pm

RunningMn9 wrote:
Zaxxon wrote:In my case, I am likely to move in the next several years
Shouldn't that have made you not shovel a pile of money into someone else's hands?

I shouldn't say 'likely', but rather 'there's a decent chance.' And no, this is why I put so much effort into ROI timeframe. I'm confident I'll at least break even by the time we may move, and that's really all I care about. My primary motivation was to drop my household's use of fossil fuels.

Zaxxon wrote:When does your installer anticipate firing up your system?
That will depend on the speed with which my County permitting machine can spring into action. Hopefully by December.

Ha. I hope that's a joke.

RunningMn9 · Post by **RunningMn9** » Fri Jun 27, 2014 4:22 pm

Zaxxon wrote:Ha. I hope that's a joke.

I already amended it to add the smiley and their actual estimate. Things do not move rapidly in NJ when permits and inspections are involved. Ask Smoove_B about his fireplace some time.

Zaxxon · Post by **Zaxxon** » Fri Jun 27, 2014 4:25 pm

tiny ogre · Post by **tiny ogre** » Wed Jul 02, 2014 1:06 pm

Gonna have to give up my monthly gumball now.

Zaxxon · Post by **Zaxxon** » Wed Jul 02, 2014 1:32 pm

That is awesome.

Yesterday we had our first net-negative usage day. I wasn't expecting to see that on our small system, so I was pretty ecstatic.

Lnorigb · Post by **Lnorigb** » Wed Jul 02, 2014 10:26 pm

Actually that bill is pretty high.

for the past 6 months we've been in the negative.

Zaxxon · Post by **Zaxxon** » Tue Jul 22, 2014 7:25 pm

Today I got my first power bill including solar. About $80 in electricity savings plus $20 in RECs.

RunningMn9 · Post by **RunningMn9** » Wed Jul 23, 2014 8:47 am

Zaxxon wrote:Today I got my first power bill including solar. About $80 in electricity savings plus $20 in RECs.

Nice. We are still mired in NJ permit hell.

Zaxxon · Post by **Zaxxon** » Wed Jul 23, 2014 8:49 am

malchior · Post by **malchior** » Wed Jul 23, 2014 9:10 am

Same here - delaying to get the roof done then permit hell.

RunningMn9 · Post by **RunningMn9** » Wed Sep 17, 2014 12:53 pm

RunningMn9 wrote:Nice. We are still mired in NJ permit hell.

We have cleared NJ permit hell!!

Panels are being installed tomorrow. Electrical hookup will probably be next summer.

The installer believes that the power company will either be there tomorrow to do things all in one shot, or will be there next week. I'll believe that when I see it.

Zaxxon · Post by **Zaxxon** » Wed Sep 17, 2014 12:54 pm

Sweet. Good luck. FWIW, my installer prepared me for the worst from the power co, and then they finished their end within a week of install.

naednek · Post by **naednek** » Thu Oct 09, 2014 12:00 pm

So what do you think of this option that was announced by solarcity?

http://www.sacbee.com/2014/10/08/677102 ... ogram.html

Zaxxon · Post by **Zaxxon** » Thu Oct 09, 2014 12:08 pm

I'd need to see the details to form a solid opinion, but at first blush the option to have a 30-year loan that ends with ownership of the system rather than a lease is a mild improvement to the options that were previously available. I imagine that's a lot of interest being charged over a term that long, but folks tend to focus on the monthly payment which is likely to be lower than the power bill was.

naednek · Post by **naednek** » Thu Oct 09, 2014 12:16 pm

the article mentioned 4.5%, and the loan could be paid off faster if you produce more energy or the old fashion way, put more money in.

Zaxxon · Post by **Zaxxon** » Thu Oct 09, 2014 12:20 pm

Wow, that's higher than I'd expect. At 4.5% over 30 years, that would mean $20,600 in interest on a typical $25,000 system loan with a $127/mo payment. I would imagine most people would instead opt for a refi or other equity loan at much lower rate, but I am a bad judge of the financial moves of the populace at large. I'm sure SolarCity knows what they're doing.

naednek · Post by **naednek** » Thu Oct 09, 2014 12:31 pm

They also mention this...

A balloon payment of 30% of total system cost is due on June 1st the year after installation, regardless of the amount claimed in the tax credit.

I'm not to sure what that means...

I'm just wondering which financing option is better. I have a friend who sales this stuff, and it might be better to go through him... They do the leasing PPA model

dbt1949 · Post by **dbt1949** » Thu Oct 09, 2014 12:37 pm

My stepson got a couple of broken solar panels given to him. (damaged in a hail storm.)
He says they'll put out enough juice to run the battery lights in his travel trailer.
We'll never know tho as he won't do anything himself and can't afford for someone to do it for him.

Odin · Post by **Odin** » Thu Oct 09, 2014 12:41 pm

I've gotten two or three phonecalls from companies selling solar arrays lately. It must be the new thing. If I were to install one, I think I'd be more likely to go local than with some call-center muppet from India who calls me on the phone and pretends his name is "James." The first ones who called, I actually made an appointment because they wouldn't just send me info in the mail. Then they called back (somebody with a North American accent this time) to confirm and also to get my birthdate to do a "soft credit check." I told them I didn't want a credit check at this time, I just wanted the info that their sales person was supposed to bring with him. That didn't work for them, so we were at an impasse and I canceled.

The next guy who called, I pretended I already had a solar array on the roof. He told me he was looking at my roof on Google Maps and that I had no such array. I said it must be an old picture. He started to argue with me, then got the message and hung up.

I'm trying to decide what to say to the next one. Perhaps, "I don't use electricity." That might be funny.

dbt1949 · Post by **dbt1949** » Thu Oct 09, 2014 12:43 pm

Tell them you went geothermal instead.

Zaxxon · Post by **Zaxxon** » Thu Oct 09, 2014 12:46 pm

Naednek, that probably refers to the 30% fed tax credit. Sounds like the buyer gets that and then pays it as a large lump payment on the loan.

RunningMn9 · Post by **RunningMn9** » Thu Oct 09, 2014 1:20 pm

Zaxxon wrote:Naednek, that probably refers to the 30% fed tax credit. Sounds like the buyer gets that and then pays it as a large lump payment on the loan.

When I was looking at buying the system, that was the expectation on their end. You take the loan out for the full amount, and then basically when you get the tax refund, you give that to them and refi the loan.

As for my case, I have cleared permit hell. In NJ, that is followed by Phase 2 - also know as inspection hell.

Already failed the rough inspection, because the plans weren't available when the inspector randomly showed up. That was since corrected, and yesterday they showed up to do the final install. After about an hour of prep work, the head contractor guy called to find out why I didn't get the shingles on my roof fixed. I was like "come again?". They can't install the panels until the shingles are replaced (about 10 were blown off by Hurricane Sandy a few years ago, but I totally forgot about it because you couldn't get any roofers for like a year after that event for a small job like that). Luckily I have a roofing guy, and he was willing to come check it out on a moments notice, and he had one of his guys come out this morning to replace them. The solar guys are supposed to come back today or tomorrow to finish putting the panels up (I guess they did everything yesterday except fixing the panels up there, so it should be quick).

Then more inspections including the electrical inspection which will fail because I modified my panel in an un-approved way (my generator is wired directly into the panel but is not protected by an interlock switch, which is verboten). THEN we wait for the power company to change out the meter and flip the switch. So basically, 2016.

Zaxxon · Post by **Zaxxon** » Thu Oct 09, 2014 6:20 pm

Hopefully the sun hasn't gone nova by the time you're leeching power.

RunningMn9 · Post by **RunningMn9** » Thu Oct 09, 2014 9:13 pm

Zaxxon wrote:Hopefully the sun hasn't gone nova by the time you're leeching power.

So I get home today and look up at my roof to admire my fancy new shingles. They look a lot like missing shingles. WTF?

Zaxxon · Post by **Zaxxon** » Thu Oct 09, 2014 9:15 pm

One day closer to nova...

em2nought · Post by **em2nought** » Thu Oct 09, 2014 10:23 pm

Can't see putting solar over and "old" "damaged" roof. Seems like something one would regret at some point. Are your shingles stapled or nailed?

RunningMn9 · Post by **RunningMn9** » Thu Oct 09, 2014 11:25 pm

em2nought wrote:Can't see putting solar over and "old" "damaged" roof. Seems like something one would regret at some point. Are your shingles stapled or nailed?

The roof isn't particularly old or damaged. There were some shingles removed in a hurricane (maybe 10 on the whole roof). I totally understand getting them replaced before putting the panels up.

I totally don't understand them climbing up on my roof and replacing some tiles but now all of them - especially the most obvious ones.

RunningMn9 · Post by **RunningMn9** » Fri Oct 10, 2014 11:49 am

In the light of morn', I discovered that the new shingles are apparently completely non-reflective. So they appear invisible at night when you shine a flashlight on them. All shingles are repaired.

Unfortunately the solar guys are now delayed until Monday.

Zaxxon · Post by **Zaxxon** » Fri Oct 17, 2014 1:35 pm

September's electricity bill - $9.55. I could get used to this.

Biyobi · Post by **Biyobi** » Fri Oct 17, 2014 1:51 pm

Zaxxon wrote:September's electricity bill - $9.55. I could get used to this.

Winter is coming.

Seriously though, congrats on that. Living in SoCal where electricity is really expensive a $10 power bill is near mythical.

Zaxxon · Post by **Zaxxon** » Fri Oct 17, 2014 2:03 pm

I have a gas-powered furnace, so winter will remain low. Somewhat paradoxically, summer is still my worst season from a power cost standpoint, as the AC usage rises by more than the panel production.

RunningMn9 · Post by **RunningMn9** » Fri Oct 17, 2014 3:15 pm

Zaxxon wrote:I have a gas-powered furnace, so winter will remain low. Somewhat paradoxically, summer is still my worst season from a power cost standpoint, as the AC usage rises by more than the panel production.

We are getting closer. Roof is repaired. All solar panels are installed. Allegedly there is an electrician there today installing the inverter (or whatever electriciany things need to be installed). From there we await inspections and we wait for JCP&L to swap the meter and flip the switch. Then I will be able to convert photons into glorious electricity.

stessier · Post by **stessier** » Fri Oct 17, 2014 8:52 pm

RunningMn9 wrote:
Zaxxon wrote:I have a gas-powered furnace, so winter will remain low. Somewhat paradoxically, summer is still my worst season from a power cost standpoint, as the AC usage rises by more than the panel production.
We are getting closer. Roof is repaired. All solar panels are installed. Allegedly there is an electrician there today installing the inverter (or whatever electriciany things need to be installed). From there we await inspections and we wait for JCP&L to swap the meter and flip the switch. Then I will be able to convert photons into glorious electricity.

And thus begins what will one day be called The Thirty Year Rainstorm.

It's cool to follow along and see what it takes to get something like this up and running.