Energy costs keep rising. Is solar electric power the affordable alternative Louisiana homeowners have been waiting for?
By Denise Trowbridge, New Orleans CityLife, January 2005
Jeff Shaw looks forward to the day his electricity bill arrives each month. He's always anxious to see how much it costs him to power his two-story, 3,200-square-foot home. Shaw's bill for October 2004 — a month of record heat when he ran two air-conditioning units almost constantly — was only $80. “I'm convinced my neighbors are paying at least $150 more than I am,” he says.
Shaw's bill is low because he is a Louisiana energy pioneer. He installed solar panels in his backyard that produce enough electricity to power up to four rooms of his house. His system, which can produce 2,500 watts and consists of four 120-watt Solerex panels and 16 batteries, cost $5,000. “The expense was easy to justify,” Shaw says. “I wanted to save about $100 a month on my electric bill by using a combination of traditional electricity and solar power.”
He succeeded, and the system paid for itself in only four years. Now that his initial investment has been recouped, Shaw can sit back and enjoy the money he is saving on his utility bill.
Most Louisiana homeowners, however, aren't so lucky. Electric bills often fill them with dread, especially during the long hot, heavily air-conditioned summers when bills can easily top $300.
There's no relief in sight either.
Energy isn't getting any cheaper. The price per gallon of gasoline along the Gulf Coast, according to the U.S. Department of Energy, is 47.9 cents higher now than at this time last year. Utility bills nationwide have experienced modest increases as well. The U.S. Energy Information Administration reports residential electric bills were 2.5 percent higher in August 2004 than in August 2003 and 4.8 percent higher in November 2003 than in November 2002.
These rising energy costs are fueling interest in solar power. “With oil and gas prices going up every day, people are looking for an alternative,” says Jeremie Branton, owner of Freedom Power, a solar energy consulting and installation business located in Thibodaux. “Solar is appealing because the technology is getting cheaper while the price of traditional power continues to rise.”
“I expect interest in solar power to grow as utility bills rise,” says Shaw, who founded the Louisiana Solar Energy Society and owns Louisiana Home Power, a Baton Rouge-based solar installation company. “In the past six months I've gotten a lot more inquiries, all from people who want to reduce their utility bills. They are afraid their electric bill will get out of control.”
The good news is Louisiana is a pretty good spot for solar power; the state averages 4 to 5 hours a day of direct sunlight, making it one of the best places in the United States, besides California and the Southwest, for generating solar electricity.
And thanks to net metering, going solar in Louisiana is cheaper and easier than it has ever been before.
The Cost of Going Solar
Shaw likens solar power systems to cars — they come in a lot of shapes and sizes with a wide range of options and price tags. Depending on the output, a residential solar power system can cost as little as $500 or as much as $20,000. “Most people think you have to spend $30,000 to put in a solar system, but it isn't true,” he says.
A portable system that generates enough electricity to power a computer can cost as little as $150. “All you need is a 5-watt solar panel, a $50 battery from Wal-Mart and a $50 inverter from Auto Zone,” Shaw says, stressing it is easier than most people think to incorporate solar power into everyday life.
A system large enough to power everything in a home can cost $20,000 or more. “A system that large can take about 17 years to pay for itself,” Branton says. The high price has turned a lot of folks off to solar power. “Some people run when they hear how long it takes to make their money back.”
But the price tag can be deceiving. Smaller systems used in conjunction with traditional utility service can be cost-effective in reducing monthly energy bills. For instance, a homeowner can run the refrigerator and a few outlets on solar power while running the rest of the house on the utility grid. Or, they can install a system that can solar power several rooms. Net metering is a new option that helps Louisiana homeowners do just that.
A net-meter solar power system is virtually maintenance free and powers a home using a combination of photovoltaic solar panels and traditional electricity. When the solar panels produce more electricity than the home is using, it feeds the power back into the utility grid. When this happens, the electric meter actually rolls backward. When the home is using more electricity than the solar panels are producing, it draws electricity from the grid. “It's a great way to reduce your energy bills,” Shaw says.
The downside is net-meter systems can't be used for back-up power, so if the electricity on the grid is off so are the lights. Otherwise, they are hassle-free and “very easy to use,” Branton says. “They're good for people who don't want worry about maintaining and running a solar power system using batteries.”
Net-meter systems also do not require changes to the home's existing electrical wiring but do require installation of a back-feeding breaker, which can usually be done by a professional electrician in about two hours. The total cost of a net-metered solar power system will depend on how many watts it can produce. A 2,500-watt net-meter system costs approximately $3,700 for panels and inverters plus $1,300 for electrical work and installation, Shaw says.
It's a good option for business owners, too. Louisiana Home Power recently installed a large-scale, $35,000 net-meter system at the New Orleans Green Project, a nonprofit architectural recycling center on Marais Street, this past October. The solar panels on the roof generate about 25 percent of the electricity the Green Project needs every month.
For those who want to keep the lights during a black out, a system mixing battery-stored solar power and traditional electricity is a viable option.
Folsom resident Jonathan Reily powers his home with a combination of solar and traditional electricity. He installed a 48-volt system with 16 batteries and 16 solar panels on a tracking system in his garden; the tracking system automatically repositions the panels so they are constantly facing the sun. Reily's solar array produces enough electricity to run the home's lights and outlets. The heating and air conditioning units run on traditional electricity.
He hopes his system will show his neighbors that solar power is viable in southeast Louisiana. “As a nation we need to get away from the oil and gas mentality,” Reily says. “My home is a model for other people.”
Reily also has a solar water heater that uses the sun rather than electricity or natural gas to produce hot water.
The popularity of solar water heaters and solar pool heaters is growing, Branton says. They are easy on the wallet and are a good way for consumers to get their feet wet in solar power before committing to a more extensive system.
A 45-gallon solar thermal water heater with a back-up heating element — so you don't have to take cold showers on cloudy days — cost about $1,200 and pays for itself in about three years, Branton says. Solar pool heaters cost about $3,000 - comparable to traditional pool heaters - and pay for themselves in about two years.
Solar power systems are also exempt from Louisiana property tax and are portable - when you sell your home, you can move your system to your new house.
But offsetting the upfront costs of a solar panel system with savings on the utility bill is usually the top concern for homeowners. Two factors determine the time it takes to recoup the initial investment: the price of traditional electricity and the number of hours the sun shines every day. “The higher the cost of energy, the faster the payback,” Branton says. And “more sunshine equals more electricity, which shortens the payback time. But solar systems do pay for themselves eventually.”
As Shaw has proven, a well-planned solar power system doesn't have to take decades to earn its keep. His paid for itself in four years, laying the groundwork for many more years of low electric bills. “Some people still don't believe solar power works, but it does,” Shaw says. “It's not science fiction.”