Why solar, why now, and why stay on the grid?

One year ago, our family installed a 5 kW solar power generation system on our roof. We used a bit of our long-term savings to do it, but we felt it was worth it. It’s worked really well for us, and we’re well on our way to recovering the investment cost in 12-16 years, thanks in part to 30% federal and 10% state tax incentives, which lowered the cost of the system by 40% as soon as we got our tax refunds.

But why did we do it, and why did we do it then? Everybody seems to want to know what it means about me and Kristin. So, here are our reasons, as best as I can report them.

  1. In the short term, we wanted to reduce our family’s carbon footprint. We have three children, who will become adults in 10-15 years. I hope they’ll live another 60 or 70 years after that, and I hope they’ll also have children. What will our world–their world–be like during their lifetimes? I don’t like to imagine them living in a harsh environment, with desperate people struggling–and competing–to live. I feel that I owe my family a world that’s in reasonable shape, and if I have to make sacrifices to do that, I’m willing to do it.
  2. Switching our home to solar power is one of the surer ways to reduce our carbon footprint. There are lots of other options, but none of them seem certain, and most depend on complicated mechanisms that could easily go wrong. We considered socially conscious investing a while back when we were starting as a family, and it quickly became clear to us that the financial markets are so complicated that our ability to influence the world’s energy choices by directing our own investments was incredibly weak and only loosely connected to reality. Reducing our demand for unclean energy from our local grid is pretty direct. I researched how our provider generates its energy, and enough of it is “dirty” (coal and other fossil fuels, much of it not using “clean” techniques) that not using it makes a difference.
  3. In the long term, we wanted to send a message to our local power company encouraging them to switch the grid to clean power sources sooner rather than later. They’re losing more than $1000 in sales to us every year because we’re not using their power. But our home solar generation system will only last about 20-25 years. When it needs to be replaced, we (or the future owners of our home) will reassess where the grid is getting its power, and if it’s clean enough, we’ll gladly switch back. If they want to regain our business, the way to do it is to offer cleaner power. I’m certain that the power companies are watching home solar use closely and that they aren’t missing this message.

As you can see, we aren’t trying to make money by generating our own power. We paid $18 to our local power company this year because we intentionally built our system to just barely get us enough power to offset what we still use from the grid at nighttime and on cloudy days. The grid is only willing to pay us about 30% of what we pay them for equal amounts of power. I doubt that anyone is getting rich selling home solar power to the power companies!

We also aren’t doing it to be more independent from utilities. Quite the opposite, in fact. We deliberately built a system that would stay on the grid and participate in the energy market along with everyone else. Each day, we generate about the same amount of power as our household typically uses in a 24-hour period. But not every day, and not continuously. We have no storage in our system. When we generate more than we’re currently using, the power company pays us for the excess. When we use more than we’re currently generating, we pay the power company for what we need. When the grid shuts down for any reason, our system also shuts down and any power we generate is lost. But in this way, we stay in the power company’s face: they know exactly how much we’re generating and using, and they know how much revenue they’re losing to us. If we went fully off-grid, they could guess at what we might use, but they wouldn’t know for sure. Our situation sends a clear signal to them: you can get $1000/yr of business back, but only if you can give us clean power.

Oh sure, there are a lot of other, less important, issues that we considered when making the decision to go solar, to do it now, and to stay on the grid.

  1. I think it’s likely that power costs from utilities will go up–at least temporarily–as they switch their infrastructure from fossil fuels to renewable sources like solar, wind, hydro, and fusion.
  2. Having said that, I also think it’s too risky to make a long-term gamble that power costs will go up. We could have let someone else put panels on our roof and maintain them, paying them a fixed price for our power instead of the power company. (Products for doing this are all over the market right now.) But that would lock us into a fixed price for 20 years, and it would be disappointing if grid costs went down instead of up.
  3. Solar cell technology has improved dramatically over the last few decades, but it seems to be leveling out now. I’m sure that solar cells will be better and cheaper next year than they were last year, but not enough that I’ll feel like I got ripped off or should have waited another year.
  4. Battery technology, which is critical for off-grid systems, is still improving rapidly. If we bought a storage system now, it would probably be obsolete in just a few years. (It was only a few months after we bought our system that Tesla announced its Powerwall battery systems, which look like the leading edge of a new generation of power storage systems for homes. That alone validated our decision to wait.) We may or may not add storage to our system in the next 5-10 years, depending on how the technology and marketplace evolves. Nothing we’ve done prevents us from doing that in the future.
  5. The high desert conditions in Albuquerque are brutal on roofs! It’s very sunny and dry here. We’re a mile high in elevation, and the sunlight on our roofs is intense. We replace roofs more often here than in other parts of the country because of sun weathering. Solar panels shade the roof, protecting it from the sun, while converting that punishing energy into something useful. I love the Judo-like move of “turning my enemy’s power to my own uses.”
  6. Many of the devices we use today: computers, tablets, phones, LED lamps, etc. require DC power. The grid delivers AC power because it allows efficient energy transmission over long distances. Solar panels generate DC power, and we currently convert it to AC for use in our homes. Unfortunately, when AC is converted to DC, we lose a chunk of it to waste heat. I’ve begun hearing proposals that the power grid should be decentralized. One reason is that it would allow local neighborhoods to use highly efficient (but expensive) AC-to-DC converters and distribute DC power locally. But if we were generating DC solar power locally instead of importing AC, we wouldn’t have to convert it at all. Getting onto the “locally generated DC power” bandwagon now just makes sense.