Solar sums

Are you interested in switching to solar hot water and/or power? My UQ colleague Tim Coelli (mainly in the vineyard and holiday business these days, but still an adjunct professor) has done the sums, and says they come out looking pretty good for the package as a whole. Of course that depends on location, costs, available subsidies and so on. Tim has produced a spreadsheet so you can work it out for yourself.

18 thoughts on “Solar sums

  1. Can’t comment on Tim’s sums for solar HW, but if they’re anything like my concurrence and experience with his sums on solar power, they should be pretty good too. Here’s my experience with installation of a 2.1kw system over a year ago under the first regime. Paid $22k for the installed system and another $652.30 for ETSA’s feed-in meter less the Govt’s $8k subsidy and $1.5k in RECs leaving a private cost of $13152.30 to find. Now if we’re talking about the extra social up front costs here it’s not that $9.5k because we need to net out the GST, namely the $2k I paid on the system and the $59.30 on the meter leaving a net social up front cost of $7440.30. The purists among us might then have to add in an estimate of the Govt/ETSA/Truenergy admin for facilitating all this. Don’t dismiss that lightly, because after 3 attempts by AGL to get my final bill right before availing myself of Truenergy’s extra 20c/kwhr greening on top of the mandatory 44c/kwhr buyback, 9 months after settling up AGL, all I have is a bemusing letter from Truenergy explaining how they’re still in consultations with ETSA/the State regulator, etc to work out just what they’re going to bill me. They assure me they’ll get back to me by November and not to worry as they can’t charge me for more than 12 months and will offer amenable terms if it’s all a bit of a struggle. Take your time fellers, I know all about the time use of money, albeit I reckon I’m just about power bill free by the regular inspection and documentation of ‘our’ new meter. For your info the system was intalled 16/5/08 and the meter now reads gross useage 5822kwhrs with 2044kwhrs fed back, the former a mix of 9c-18c offpeak/peak and the latter now earning 64c tax free.

    Privately you can see why I jumped at such quant largesse and why Tim’s figures concur, although there’s that small matter of the upfront cost hurdle for you all to enjoy, as well as the fallacy of composition should you all do so. Hence Minister Garrett’s sudden change of heart when private enterprise could get you a 1.1Kw system for no private cost to you but some form filling. As to the real savings in CO2, we all need to appreciate that the 12 X 175 watt panels came from China and the Fronius inverter from Germany and the sundry accoutrements from who knows where, as well as the carbon footprints of the salesman and installers, etc. That’s not easy to estimate but not inconsiderable i’d suggest. As well on a cold, rainy overcast day that approximately $20,500 worth of real resources will be knocking out a measly 150-200 watts of power while the lads at Playford Power Station shovel Leigh Creek burnable dirt furiously while I crank up the reverse cycle. As for struggletown sharing the load I’ll leave it you true Greens everywhere to imagine.

  2. I’m actually more interested in the carbon sums. There’s no question that solar hot water makes sense, any way you cut it, unless you’re unfortunate enough to have a badly orientated terrace house.

    On solar however, it looks to me like its environmentally better to buy Green energy (if you get the highest grade, not one of the marketing scams) than to buy the panels for your roof. I’m not convinced of this, and would welcome feedback from those with more knowledge, but that’s how it seemed to me when I took a look.

  3. The key point is that both PV and solar HWS may not suit many households. Therefore government policies should not push them aggressively as an energy saving panacea which means the really big solutions must lie elsewhere. That is saving 80% of CO2 by 2050.

    Interestingly a non-solar device in the form of a compressed gas water heater is now eligible for solar rebates. That suggest that even bigger fudging of RECs lies ahead to meet targets. Several States have generous feed-in tariffs on PV surplus electricity. I suggest some years hence someone does an analysis to see if it has achieved its aims, noting that Spain and Germany now want to phase them out.

    As a general observation I’d say solar helps somewhat but requires some of the players to have lazy capital burning a hole in their pocket. It needs the bulk of energy supply to come from elsewhere to smooth out its vagaries.

  4. I have made “back of the envelope” estimates of the cost today to save one kg of CO2 by different means which will they might not be accurate are probably OK in relative terms.

    It is about 17 cents for Photo Voltaics, 7 cents for solar hot water, 1 cent for geothermal energy, 2 cents for wind energy, 4 cents for solar thermal and about 1/2 cent by saving energy.

  5. @observa
    Well I live in a very cloudy part of Australia and most of my net metering was at 16.5c/kwh. I got 2kw of PV in 2005 and the fact that my electricity bill is in credit I attribute more to general energy frugality than PV. For example I have a timer on my 80L electric HWS. In my opinion those lucky enough to get feed-in tariffs enjoy both
    a) social status from a bling bling roof
    b) a subsidy from the poor.

    As to Leigh Ck coal it could be pointed out that Playford B power station at Pt Augusta is more decrepit than Victoria’s Hazelwood. Coal from the desert could be a bit drier which must help. Of course a few kilometres away yellowcake is loaded onto the Darwin railway for northern hemisphere customers. They must be grateful Aussies don’t want any for themselves.

  6. Thanks to John for this posting – I have already had some nice emails from people who have used my SolarSums calculator after reading your post.

    The comments made so far are good and point to the fact that governments need to think carefully about the costs and benefits (private and social) of their entire climate change program – because the average consumer is unlikely to have the time/skills to research this aspect in depth.

    The calculator that I have produced is very narrow in its focus – it looks at private costs and benefits at the household level.

    The aim is to provide households with some help in making these calculations, because ultimately, if governments plan to deal with climate change using price signals (which as an economist I applaud) then the average consumer needs to be able to access sufficient information to be able to do these sums.

    So it is a very small contribution, but I hope it helps a bit.

  7. I found a few errors; it seems to overstate the value of energy savings from PV.

    For me, with the OPHW turning into 20% onpeak, and Sydney’s energy costs it saves me a whole $100/year for solar hot water, which is far from worth it (that’s before the cost of the money to buy it).

    And my wife works from home, so we’d consume all of the power produced by a 2kW PV system so no selling value there.

    As I understand it, if I sell the RECs then someone else gets to produce CO? in my place. Is that not right?

  8. If you have downloaded a copy of the SolarSums calculator this week please check that it is Version 1.1(beta).

    An old version was accidently loaded for a few hours on recent days because my webmaster (me) had a technical issue (struggling with file management in a canned website building tool…).

    Also, I am getting some excellent emails with some nice ideas – if this continues I might set up a discussion board so that we can exchange ideas.

  9. does anyone have a source for the “climatic zone multiplier” for different cities in Australia? I know that Brisbane gets quite a bit more incident sunlight than Melbourne.

  10. My experience with a 1 kw grid connected system was that it was installed nice and quickly (this was before the rush, before the 08 budget), but Jemena took a year and a day to install the meter. Once it finally got on we started getting slightly better bills from Origin. Then, just a few weeks ago, they said oops, look what we’ve done, in fact we owe you lots of money, here, the next two bills are on us.

    Which is nice, but since they didn’t explain their workings and I don’t really know how to read my meter properly, leaves me bemused, but not amused.

  11. My previous comment probably was more negative than I intended, or came out that way.

    I appreciate the time put into this tool, and I’m far from sure the things I’ve found are errors, or just different ways of modelling the systems.

    As Tim pointed out to me, the solar hot water is not as bad as I thought, since you can put the booster onto off-peak too. It’s still a loss-making deal, though, because off-peak power is so very cheap (it’s about 1/4 the on-peak rate).

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