Homesteading and Livestock

Self-reliance and sustainability in the 21st century.

Add to My MSN

Living Off-Grid: Our Solar Costs

12/5/2012 1:20:00 PM

Tags: off-grid living, Washington, Ed Essex

Our Solar Equipment

Solar costs have so many variables, it is difficult to put an exact number on the cost of solar power. It will vary greatly from household to household and state to state. There are currently federal tax credits to consider and some states also offer tax credits or deductions to install solar power.

Added to that, solar panels will last about 25 years, inverters 15–20 years and batteries anywhere from 10–15 years. The good news is that all three of those components are lasting longer all the time and the purchase cost is going down as more and more products flood the market and solar becomes more popular to consumers.

There are a lot of numbers out there in cost per kilowatt of every kind of power including solar. Many of the solar numbers being quoted are outdated so if you are doing your own research be careful of that. There is a general consensus that the costs are going down and will continue to do so.

Another problem you will run into is that the cost numbers that are published don’t include all of the costs. For example, Washington State has one of the lowest basic electrical rates in the country but by the time the state and local authorities get done tacking on their add-ons the price goes up considerably.

We decided to take a look at our own costs which we can identify now that we have been operating for two years, going on three.

Our system operates a modern 1500 SF house with attached garage, woodshed, and carport and a 1300 SF barn. We also have a well with a 240v pump. Our appliances are typical of most households.

Our initial cost installed was $22,000. The Federal Government offered a 30% full tax credit so we only had to pay $15,400 for the system.
 
I am going to assume the life expectancies of the main components per the following;
Panels – 25 years
Inverter – 20 years
Batteries 12 years

I’m using 20 years as my cost timeline because the panels and inverter will last that long. Maybe the inverter will be a couple of years short but the panels will last even longer so that would even out. It’s just an estimate and any one of these components could go over or under this valuation. Since the batteries only last 12 years give or take, I will prorate the next 8 years with todays replacement costs for a total of 20 years.

We also have to add the generator and fuel costs. We use our backup generator about 100–125 hours per year. To keep this article simple I’ve calculated that cost to be $538.00 per year.

Here is how the totals break down:

System cost for 20 years               $15,400
Battery Replacement 8 years      $ 4,200
Generator and Fuel                        $10,750

Grand Total for 20 Years                $30,350

That equals $1,517 per year or $126 per month or .68 per KWH (per what my system produces).
Where I came from we paid .20 per KWH for public power. Some areas of the country pay much more.

At this point it looks like I am paying a small fortune for solar power but the above information is not complete. If I am going to compare apples to apples I also have to include the cost of public power installation in our formula. It is stated above that I paid .20 per kWh for power where I used to live. That’s true. That is everything that is on the bill but the bill does NOT include costs to hook your power up to your house. The solar numbers quoted above do. Remember that my solar price included installation.

Our Solar Panels

If you live in the city next to a power pole, you might pay anywhere from a few hundred dollars on up to have your power connected but if you build your house further away from the power lines it can cost anywhere from  $8.00 to $14.00 per foot to get connected to the power lines. In my case it would have cost $8,500 IF my property were next to a road that had power lines on it. I just had an estimate done for a client that wants to build on 80 acres and his quotes ran from $17,000 to $25,000 to connect to the local power utility. Because I live so far from the nearest power line my actual costs would have been over $40,000 to bring power to this property.

If we use the example above of paying $.20 per kWh and then add the power connection fee to it, that would compute to another $.14kwh bringing the total to $.34kwh and $.62kwh for my client. All of a sudden, solar power looks to be much more competitive.

We can draw several conclusions from this pricing exercise by looking at the numbers above. It is cost effective to have solar power if you live in a sunny climate and don’t have to use a generator much. It is cost effective to have solar power if you build too far away from the power grid (the rule of thumb is ¼ mile). 

There is also one other factor to add to the equation. My price per KWh won’t go up for 20 years. I doubt you can say the same for those on public power. By that time my price of $.68 per KWh might be looking pretty good.

Ed and Laurie Essex live off grid in the Okanogan Highlands of Washington State where they operate their websites GoodIdeasForLife.com  and OffGridWorks.com



Related Content

Inspiration for Solar Projects

Scott Davis’ “Solar Projects, Big and Small” video offers inspiration for both solar energy enthusia...

Living Off Grid - An Average Summer Day

A typical day of activity on a modern homestead and off grid.

Finishing the 'Barndominium': Final Stages of a 3-Year Project

We started our adventure of building a barndominium on our Texas property while still in Australia. ...

Visitors and Company

Ed and Laurie struggle with making time for visitors while dealing with all of the daily business an...

Content Tools




Post a comment below.

 

BrianEdwar
2/26/2014 9:33:01 AM
Solar power facilities are actually cheaper to create than fossil fuel and other plants.I was able to save thousands of dollars on my solar panel kit and installation by using mysolarinstaller.com. By entering my zip code, I got free quotes from the best solar installers in my area. I hear they serve all of North America so if your looking to go solar, I advise you check them out. Here's their link: www.mysolarinstaller.com

t brandt
12/12/2012 11:29:45 AM
Agreed. As in Nature, businesses that can't compete should be allowed to go extinct.... But the "tax breaks " you listed above only add up to ~$0.6 billion while the fed govt, biggest parasite of all, spent $1,200 billion more than it took in during each of the past 4 yrs and projects to repeat it again for the next four yrs....Actually, taxes on corporations is double taxation because the profits are taxed again when they're payed out as dividends....We have a spending problem, not a taxation problem. The same Liberals who cry for sustainability in our environmental matters seem to forget all about it when it comes to govt spending.

Ed Essex
12/11/2012 9:49:43 PM
Dean, I responded in detail yesterday but I don't see my post today so I will repeat it here. I have 8 each 215 watt panels. 12 each 2 volt Solar One batteries wired for a 24 volt system. The batteries are rated at 1160 Amp Hours. I also have a 4000 Watt Xantrex inverter and an Apollo T-80 HV Charge Controller.

Stephanie Tautkus
12/10/2012 11:15:07 PM
Talking about parasites Here is a little info: Here is a list of the top 10 corporate deadbeats and slackers : From the office of Bernie Sanders VT 1) Exxon Mobil made $19 billion in profits in 2009. Exxon not only paid no federal income taxes, it actually received a $156 million rebate from the IRS, according to its SEC filings. 2) Bank of America received a $1.9 billion tax refund from the IRS last year, although it made $4.4 billion in profits and received a bailout from the Federal Reserve and the Treasury Department of nearly $1 trillion. 3) Over the past five years, while General Electric made $26 billion in profits in the United States, it received a $4.1 billion refund from the IRS. 4) Chevron received a $19 million refund from the IRS last year after it made $10 billion in profits in 2009. 5) Boeing, which received a $30 billion contract from the Pentagon to build 179 airborne tankers, got a $124 million refund from the IRS last year. 6) Valero Energy, the 25th largest company in America with $68 billion in sales last year received a $157 million tax refund check from the IRS and, over the past three years, it received a $134 million tax break from the oil and gas manufacturing tax deduction. 7) Goldman Sachs in 2008 only paid 1.1 percent of its income in taxes even though it earned a profit of $2.3 billion and received an almost $800 billion from the Federal Reserve and U.S. Treasury Department. 8) Citigroup last year made more than $4 billion in profits but paid no federal income taxes. It received a $2.5 trillion bailout from the Federal Reserve and U.S. Treasury. 9) ConocoPhillips, the fifth largest oil company in the United States, made $16 billion in profits from 2007 through 2009, but received $451 million in tax breaks through the oil and gas manufacturing deduction. 10) Over the past five years, Carnival Cruise Lines made more than $11 billion in profits, but its federal income tax rate during those years was just 1.1 percent.

Dean Scott
12/10/2012 9:38:34 PM
Could you include the size of your panels and battery bank?

t brandt
12/10/2012 4:08:19 PM
A parasite lives off the efforts of another without giving anything in return. Taxpayers in no way benefit when someone uses a govt grant to finance his own chosen lifestyle. The emphasis should be on 'self" in the concept of "self-sufficiency." Those self proclaimed do-gooders who buy the Chevy Volt, for instance, spend $60 G of their own, but the taxpayer payed another $190,000 to give them that opportunity to satisfy their misguided consciences. The science simply doesn't support the concept that fossil fuel is ruining the planet, so use of "alternate energy" boils down to a problem of economics, not ecology...The author of the article is disingenuous when he tells us how cheap PV can be when he relies on the govt assist & ignores cost of capital in his figures....While I'm not exactly one of the Doomsday Prepper nut jobs, I do see a high probability that the Roman Empire is about to fall once again and chaos will ensue. Those who can adapt to self sufficiency will have a better chance to survive. and therefore otherwise applaud the author's choices.

Wendell Van Deren
12/10/2012 1:05:09 AM
No the actual parasites of this world are the ones who are unwilling to try to improve this world and those that won't work. When the automobile was first invented it was one of the most impractical inventions ever made there were no gas stations and few roads that could accommodate it. We will develop new ways of doing things or we will end up someday without transportation or electricity and most people these days are too whimpy to live that way.

League Bowler
12/9/2012 7:26:44 PM
Your cost of Replacment Parts may or may not go up in the years ahead, if they do your cost per watt will be more ..... Just saying otherwise nice informative piece!

Ed Essex
12/8/2012 6:02:41 PM
Your comment helps to remind me how much I appreciate all of those who blog and share their success's and failures so that others might learn and benefit from their experiences; all the while knowing that there will always be some that have to be critical or even rude at times.

t brandt
12/7/2012 11:45:45 PM
a) Taking advantage of the 30% tax credit has you parasitizing the American taxpayer Thanks.....(b) That $22000 you put out up front, had it been invested at a conservative 5% interest, would have brought in another $31,000 profit over the 25 yr lifetime of your solar system. Add that lost interest to your costs. ..But then, you are so far off grid, costs of running lines to the grid would be prohibitive. That's the only case where solar makes sense.... You could have considered a wood gas powered generator.

Ed Essex
12/7/2012 1:06:01 AM
Thanks Bruce, I learned a few things myself. The current information out there is not all inclusive of all costs so you really have to do your homework and consider everything. One of the biggest things i discovered in my research is that the published rates state by state per KWh are not accurate. They are quoting raw power costs only. Look at your power bill. There are a lot of add ons besides the initial cost of power. If you use the published power rates to compare to solar it is apples and oranges. Our actual power bill in my last house was triple what the published KWh rates are so beware what numbers you are using to decide whether it is better to go with public power or solar. if you don't understand what I am saying here look at your phone bill. It is the same way. The total bill is way more than the initial phone charge from the service provider.

Bruce McElmurray
12/6/2012 3:04:56 PM
Thank you for posting this as it got me to thinking what my costs are living on the grid. When we built we compared systems and solar was more than twice as much as being on grid but now prices have come down making it more cost available. By being on the grid we paid $6,200 to run our electric underground to our house. The co-op made it easy with two loans of which we received our electricity free on the first loan. We now pay around $65.00 a month. We heat with a wood stove and cook with propane. We have come to know the employees of the co-op and enjoy their company. When our power goes out it would be nice to be off grid however. Your point of current costs for installation is a factor to consider. We just happened to hook up at the right time and costs have grown over the years. Our break even point has been reached many years ago. I suspect that more and more people will go to solar in the future as costs and benefits come down. We did not go with solar because of the high cost at the time and we would just now be at the break even point whereas we reached that point in three years with the electric co-op. When we decided to go on the grid solar was not as maintenance free as it is now. Good article that got me to thinking what living on the grid costs.







Subscribe Today - Pay Now & Save 66% Off the Cover Price

First Name: *
Last Name: *
Address: *
City: *
State/Province: *
Zip/Postal Code:*
Country:
Email:*
(* indicates a required item)
Canadian subs: 1 year, (includes postage & GST). Foreign subs: 1 year, . U.S. funds.
Canadian Subscribers - Click Here
Non US and Canadian Subscribers - Click Here

Lighten the Strain on the Earth and Your Budget

MOTHER EARTH NEWS is the guide to living — as one reader stated — “with little money and abundant happiness.” Every issue is an invaluable guide to leading a more sustainable life, covering ideas from fighting rising energy costs and protecting the environment to avoiding unnecessary spending on processed food. You’ll find tips for slashing heating bills; growing fresh, natural produce at home; and more. MOTHER EARTH NEWS helps you cut costs without sacrificing modern luxuries.

At MOTHER EARTH NEWS, we are dedicated to conserving our planet’s natural resources while helping you conserve your financial resources. That’s why we want you to save money and trees by subscribing through our earth-friendly automatic renewal savings plan. By paying with a credit card, you save an additional $5 and get 6 issues of MOTHER EARTH NEWS for only $12.00 (USA only).

You may also use the Bill Me option and pay $17.00 for 6 issues.