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Who Buys Solar?

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Who is buying solar in Central Ohio these days?

Homeowners and farmers are going solar in growing numbers, for good reasons. For homeowners, solar puts their rooftop to work supplying clean energy for the home. Carefully-installed solar panels produce surprising amounts of electricity in Central Ohio and throughout the state. A quality solar installer will mount the right number of panels, in the right location, correctly tied into your home electric panel and your utility meter. With Net-metering, your utility will credit you on your bill for every kilowatt-hour of solar power you put back onto the grid, in effect, sharing it with your neighbors. This can shave your monthly bill down from, say, $125 per month to below $10 per month. The amount you no longer pay the utility is your solar investment, and once the system is paid down, you are making free electricity.

For many of us, these technical points and financial analysis model are of less interest than the opportunity to take control of our power and make a positive step toward a cleaner, more sustainable planet. No matter which comes first — the financials or the environmental commitment — solar makes sense across the board.

With utility rates rising, an investment today in a solar electric system offers predictable long-term energy costs and a strong hedge against energy rate inflation. A homeowner can often see a 7-9% internal rate of return on their solar investment, a far better return than many investments currently offer. And the higher and faster your electric bill rates rise, the higher the IRR and the faster your return on investment.

Farmers are also buying into solar in a big way lately. Why is that? Our experience has been that farmers, as businesspeople, tend to plan on a longer cycle than many other kinds of businesses. They plan years in advance, and they understand how major investments in equipment can multiply profit potentials. Among the long-term costs farmers seek to manage are their energy costs, which can be high with energy-intensive tasks as milk pumping, refrigeration, grain drying and grinding, barn lighting and fans. Solar can eliminate the volatility of energy costs; for farmers, who deal with volatility in many aspects of their operations, eliminating one area of uncertainty is worth more than money. Peace of mind is priceless.

Solar Panels as Lucrative Retirement Planning

Today’s life expectancy in America is eight years longer than it was in 1970. That’s eight more years to enjoy retirement; and eight more years of savings to put away. In a challenging economy, there are various factors that can threaten a comfortable retirement, such as declining property values and interest rates, higher living and health care expenses, and a lower percentage of employer contributions. A well-planned retirement strategy is crucial.

Stuart Ritter, vice president of T. Rowe Price Investment Services, says it can be difficult to stay on budget while trying to make a lump sum last 30 years, especially in the first years of retirement. “That’s why we encourage people to think of it more in terms of income [stream], and not as a balance,” he tells USA Today.

One source that can be used to generate steady revenue — a source we can rely on for millions of years—is sunshine. More people are discovering that by purchasing their own solar panels and harnessing the sun’s energy to produce their own power, it’s possible to collect a paycheck without lifting a finger.

On the Rooftop

Orange County, Calif. residents Wendy Moonier and her husband Fidel Garza were brainstorming how to manage their money for retirement. After the mortgage was paid off, the electricity bill would remain — and increase as the years progressed. With a roof that needed replacing and the attractive California solar rebates, it was the ideal time to go solar. Moonier and Garza purchased a 30-panel solar photovoltaic (PV) rooftop system from Southern California Edison. They’re saving several thousand dollars each year on electricity and expect their system to pay for itself in 15 years. “It’s the best investment we’ve ever made on our home,” Moonier reveals. “When I saw how well this works, I thought everybody should have this … It’s the only thing we’ve done on our home where we’ve seen an immediate return.”

Newt and Inez Stevens, a couple in their 80s, utilize the sun in multiple capacities. Living in a retirement community in Phoenix, Ariz., the Stevens use solar PV and solar thermal panels to charge their electric vehicle, heat 90 percent of their hot water and power half of their duplex. “For us, solar was a practical solution,” Newt tells The Daily Green. “Our primary motivation was economic … And if we produce more than we use, the power company will pay us the difference. We’re seeing a better return on our investment than anything I can get at the banks or stock market.”

Community-Owned Solar

Installing solar on your home or business may not be practical. Community-owned solar allows anyone with a utility bill to own solar panels, offset their electric bill, and collect income for the clean energy they produce. “It seems the cost of electricity has only and is only going up, as well as how much electricity we need,” said Jim McDaniels of Colorado Springs, Colo. “I wanted to reduce my electricity cost and help the environment at the same time. I wanted to plan for my future.”

McDaniels began researching online, reading newspaper articles and posting questions on solar energy forums when he discovered community solar developer Clean Energy Collective. He purchased 25 solar electric panels in the Colorado Springs Community Solar Array with a 10-year loan, offsetting 120 percent of his electricity use (the maximum percentage that Colorado Springs allows). “I decided it was a great deal so I went with the maximum and surplus months,” McDaniels said. After his projected 13-year payback period, he’ll receive free electricity, earning an estimated $160,000. “The savings should give me a better chance at an affordable retirement,” McDaniels said.

Do-It-Yourself

For the hands-on, ambitious type like Rich Herr, a retired electrical engineer, constructing a solar system from scratch was the most appealing option. “For the money I put in it, the return on [the solar system] is better than the return I get on my 401(k),” Herr said. “I’m not getting money in my hand, that’s just money I don’t have to pay.”

(Re-posted from Renewable Energy World, Emily Hois, February 17, 2014)