Eco Investor June 2018


My Long Switch to Solar

By Victor Bivell

After many years of planning, I finally flicked the switch and installed a roof top solar energy system. It's a 4.55 kilowatt system and so far it's working well and producing enough energy so that there are numerous times during the day when it makes more energy than we use and we contribute renewable energy to the grid.

The system is an important step in my long term plan to totaly electrify our domestic energy useage. In 2014 I installed a solar hot water system with electric boosting. In 2016 I took the house off the gas grid, and in the coming years I aim to electrify our car energy and take our cars off the petrol grid. Although I am happy to stay on the electricity grid, electrifying everything allows me to go the next step and be able to produce solar electricity to reduce our total energy costs and our carbon footprint.

When I say the photovoltaic system was a long time in the planning, I mean that I first got a quote for a system in 2011. It is interesting to see how much the technology and pricing have changed since then.

The 2011 quote was from AGL for a 1.9 kW system that comprised ten 190 Watt Suntech panels and an SMA DC inverter. These came to $4,550, but a tilt frame to get a northerly aspect increased the cost to $5,750 and a nett meter increased it to $6,610. That's $3.48 per Watt.

In 2014 I got a quote from a specialist installer for a 3kW system comprising twelve 250 Watt Yingli panels and six APS micro inverters. This was an east-west system and included a bidirectional meter. The total cost was $6,555 or $2.18 per Watt.

It was worth waiting as the system I now have is 4.55 kW with fourteen 325 Watt LG panels and 14 Enphase micro inverters. It has an east-west configuration with six panels facing east and eight panels facing west. Before installing the system I switched my retailer to Powershop, which is owned by ASX listed Meridian Energy, and they installed a free bidirectional meter. Solaray Energy, which says it is one of the largest and leading independent installers of residential solar energy and Enphase systems, supplied the system for a final cost of $7,870 or $1.73 per Watt. That's half the per Watt cost from 2011 even with micro inverters.

The systems and numbers show just how big and genuine have been the much talked about improvements over recent years in solar technology and the cost reductions for residential solar.

Nonetheless, $7,870 is a big investment, and it is even bigger if we add in the Federal Government's investment of $2,997 in small scale technology certificates which brings the real price to $10,867.

What sort of energy production do I get for this money, what is my expected return on investment, and what is the payback period?

To work out how much power a solar energy system in Sydney will produce you multiply the wattage of the system by 3.9. So my 4.55 kW system could produce an annual average of 17.7 kW hours per day. However, it's an east-west system so there is a 10 to 15 per cent decline in production. If we say 12.5 per cent then my daily average is 15.5 kW hours. There is also some late afternoon shading in the period before and after the winter solstice when the sun is low in the north. I don't know how much that will affect total production, but it shouldn't be too painful. I'm told the panels should do better than 3.9 so let's stick with 15.5 kW hours for this example. But to be clear, if our system averages 15 kW hours per day over a year I will be happy with it.

This was attractive as our average daily useage in recent years has been between 13.3 and 14.9 kW hours, so I expect that over a year we will be modest but net contributors of energy and renewable energy to the grid. That would be nice.

If we look at it on an annual basis, 15.5 kW hours per day is 5,657 kW hours per year. According to our electricity bills we used 5,436 kW hours in the year to May 2017. So our production should about match our consumption, but we will still have electricity bills as the money we get for power we send to the grid is a bit less than half what we pay for power from the grid.

The writer’s solar energy system, and the first day of generation as seen by the Enphase micro-inverters. The pale blue is energy generation, the dark blue is energy exported to the grid. The pale orange is energy self consumption, the bright orange is energy imported from the grid. The energy imported after 4 o’clock is mostly electric solar hot water boosting followed at 6.30 by cooking.

Another benefit of switching to Powershop is that they have one of the best feed in tariff rates. They pay 12.8 cents per kilowatt hour, which helped to make the payback numbers look attractive. We buy power at 27 cents per kilowatt hour, which is on the cheaper side.

With these numbers we can work out the return and payback. To keep it simple let's assume we both produce and consume say 5,600 kW hours per year. If we bought that amount it would cost $1,512. If we sold that amount we would receive $716. The key to improving the return is to maximize the use of our own power, our solar self consumption.

Both Powershop and Enphase provide great 24/7 data - Powershop on total and daily useage in half hour intervals, and Enphase on daily production in quarter hour intervals plus total daily consumption and net energy exported to the grid.

We have had the system for only just over a week and our daily consumption varies, but it looks like we are currently self consuming about 5 kW hours per day. That is saving us $1.35 per day. I'm not sure how well we can use that number for a whole year, especially as we will try to increase it, but let's use that for now.

The writer’s family electricity usage in half hour intervals as provided by Powershop. The two black squares on 9 May are when the solar energy system was turned on at 3pm. Black means there was no importing from the grid and power was exported. The bright yellow starting at 4pm is the electric hot water booster drawing power from the grid, followed by evening cooking, lights, sometimes heating, etc. This is a winter pattern when electricity useage is high. A diverter will reduce the yellow.

On an annual basis, these numbers give us $492 saved through self consumption, and $490 earned though sales to the grid. That puts us $982 ahead each year. We paid $7,870 so that is a payback period of eight years.

I'm happy with that.

But the story doesn't end there. Apart from increasing solar self consumption, there are two other moves I want to make that will further improve the economics.

I am looking into getting a solar diverter, and perhaps next year or the year after I want to get an electric car.

A diverter will divert excess solar energy into our electric boosted solar hot water tank. The diverter I am considering will only divert energy while the solar energy system is producing electricity and only after all other self useage has been met. In this way it can supplement the solar tube collectors and give us more hot water by the end of the day, so we need less boosting. I am told that the diverter can make a significant difference to the temperature of our hot water at the end of the day and this would result in good savings that would boost our return on the solar energy system and its payback period.

Any excess solar energy would then be sold to the grid. This is most likely in summer when the hot water in the tank can reach the necessary 58oC at which point it does not require boosting.

The writer’s export of electricity to the grid in half hour intervals from when the system started on 9 May to 31 May. Black is no export. Yellow and white are high exports.

The main value of a diverter would be in the cooler months of April to September when the tank always needs boosting, often significantly. Last year during this period electric boosting ranged from 170 to 269 kW hours per month. Boosting is by far our biggest electrical expense.

The diverter I am considering costs about $1,700 so that would bring the total system cost to $9,570. But every kilowatt hour we save in hot water boosting is worth 27 cents. That's 14.2 cents more than if we sold it to the grid.

I have wanted an electric car for a long time and next year should see some suitable models come on the market. As much as I could dream about a Tesla, a Nissan Leaf or equivalent city runaround would be fine.

This would enable us to start work on getting our family off the petrol grid, and begin to bite into our biggest energy spend, which is petrol. We have two cars and spend about $3,500 to $4,000 a year on petrol. An electric car could seriously reduce that number.

This is the key reason I did not get an energy storage system with the solar energy system. I thought why pay $5,000 to $10,000 to get a battery when I can put that money towards an electric car and get a very much bigger battery.

It is early days but so far it seems that if I charge the car during the day on the standard power point trickle charge then this would be normal solar self consumption. Power from our solar energy system would first go to the car and any other domestic use, then to the diverter, and then to the grid.

At a practical level, in most cases trickle charge would be fine for us as we are in the inner city and most of our trips are very short, say 5 to 10 kilometres. It should be a case of just topping up the battery. For the first years I'll keep the second, petrol car for the long trips and work out how to make it unnecessary. There is also the possibility of using the car battery to help run the house, and I'll look into that more when buying the car.

Individually and together, a diverter and an electric car have the potential to greatly increase our solar self consumption and maximize the return from our solar energy system.

My suggestion to anyone who can is to electrify everything, get off the gas grid, get off the petrol grid, and make your own clean solar energy. Along with all the other benefits, I'm finding it's a sure way to make a sunny day even better.







Search Eco Investor