Leasing solar panels

[Lo_Volt]

I've been looking around for solar installers in my area.  I had found two very good companies, both of which gave me decent quotes.  Around $40k for 7200 W systems.  Then someone suggested I contact Solar City.  They are the installation company that Google partnered with to boost solar. 

I went ahead and got a quote from them.  It was also around $40k, but they also had another option, leasing the panels racking and inverter.  I haven't gone any further than their initial quote, but it seemed too good to be true.  Cost would be $2000 down and around $180 a month or I could put $16k down and pay nothing each month.  All proceeds from power sold back to the power company would be mine as well as renewable energy credits.  After 20 years, (the warranty on the panels) the system would be mine. 

The only gotcha I can see is that they'll only support the system for free for the first 5 years.  After that they want to sell me a maintenance contract on the equipment.  Seems a little shady to me and if I go further with them, I'll get details first. 

Has anyone else heard of leased solar systems?  Does anyone have experience with it?  Any comments?

[dnix71]

Run away. If you put down 16k you still do not own the panels. If the company fails those panels belong to the company's creditors. Two: never lease anything that is not guaranteed for the life of the lease. This applies to cars, too. If it fails you owe money on a non-working item. Such a financial arrangement should be considered a criminal act by the leasing company. There is also nothing at all to prevent the company from raising their lease fees. 20 years is a long long time in any technology business now.

$40K for a 7200 watt system with grid-tie with battery backup would be a good deal, depending on the rebates and tax credits. The solar improvements should be considered part of your home, even though in theory most will tell you that you can take them if you move.

If you 'invested' $40k in stocks or banks you would get absolutely nothing for it. Investing in solar to cut energy costs gets you a real rate of return on your money.

[oztules]

in the usa 7200watts is only worth 14000.... why pay 40grand.... try ebay....


.............oztules

[DanG]

sunelectric sells a 16000 watts system for $34,000 - but it'd be a chore to find room for eighty 210 watt panels at 1400 square feet total!

[dnix71]

oztules You might buy 7200 watts of panel for cheap, but installing them on a roof with grid-tie and battery backup requires racking and permits. I have a coworker who paid $30k for 5500 watts of grid-tie panel with battery backup and got about $10k back in rebates/tax credits.

This isn't something you can do yourself in the suburbs. Out in the country racked on the ground off-grid would be lots cheaper.

7200 watts is a decent size. It might actually run a whole house a/c some of the time. My coworkers' 5.5kw won't. She had to buy a natural gas genset to run the a/c if the grid failed, like after a hurricane.

[oztules]

I dont support your idea on this at all. As I read it, the poster didn't mention battery backup.

This is an overpriced kit here http://www.ebay.com.au/itm/5-Kilowatt-Solar-Panel-System-5kw-Inverter-Grid-Tie-/190551650774?pt=AU_Solar&hash=item2c5dc371d6

It has all the paperwork needed to claim rebates and recs (clean energy council red tape and australian standards). $14400 is 5kw with everything except the bloke to put it in.
 
An installer will cost $1500, government rebates will be about $6000... so about $10000 for 5kw properly installed, with all the accreditation and red tape sorted out

. ... 40 grand buys you a big system... not a little 7kw system

and thats in this badly run country with the worst government in history....... Surely you must be able to do better over there.

In Tasmania, 4kw is the limit without special consideration from Hydro Tasmania.



................oztules

[Lo_Volt]

The $40k was installed with inverter and racking on the ground.  It would be cheaper if I could use roof mounts but, my house can't handle it.  $40k would not include backup batteries. 

Indeed, the thing that really had me suspicious was the short warranty.  The panels are covered for the full 20 years, but the inverter and everything else is only 5 years.  I'd have to pay for a warranty on that and I got no up front quote on the cost of additional coverage. 

As for 7kW for $14k, sure I can buy the panels at that price, I certainly can't buy an installed system for that price.  Not here in the US. 

If I wasn't so busy I'd do it myself.  I figure a little over $20k gets me all the materials for a ground mount system.  I'm not real thrilled about paying an extra $20k to an installer who may or may not do it the way I want. 

[DanG]

http://solar.coolerplanet.com/Articles/solar-calculator.aspx

and add...

Renewable energy credits (RECs) provide another potential stream of revenue for owners
of systems that generate electricity with renewable resources. In many areas of the United
States, RECs are bought and sold as a commodity, commonly either to fulfill a utility's RPS
requirements or be repackaged as “green power” and sold under a voluntary program.
Utilities should not be permitted to seize RECs from system owners without paying the
market price for them.

FreeingTheGrid2008_report.pdf

[jvnn]

I'm grave digging this old thread because for me this lease looks like a no brainer.
I will get another $350 discount that's not mentioned because the person who refers me will give me the referral fee less his income tax hit.

So what I'm looking at is a 20 year lease of 2.4 kW installed for a prepay of $3170.

Includes:
-Output performance guarantee
-Any repairs needed done by them - they expect to replace the inverter after 10 years
-They monitor it and I have a web link to monitor also
- Insurance for damage to system as well as damage to my house, liability ($2M) etc
-They pay to remove and reinstall when I need to re-roof
-They do all the paperwork, install etc etc
-After 20 years option to extend lease or they pay to remove system.

To come up with my savings/return on investment their assumption is that power cost increases by 5% per year.
Under this assumption, I make back my prepay from reduced utility bills in the first 10 years...
Where else can I get 11% return with the crooks on wall street stealing anything they get their hands on?

Obviously - I won't own the equipment, but this is an installed system with lots of down the road service benefits for scarcely more than the panel cost alone.
Can anybody point out the  problems here?

[dnix71]

The problem is the payback is 10 years. It might be shorter where you live if you buy.

http://www.prweb.com/releases/2012/3/prweb9282391.htm

The other down side to a lease is the tax angle, which I am unable to calculate here. If you own, then the system could be sold with the home (as it should, this isn't a portable appliance - there are holes in the roof and alterations to the wiring done by permit). If you own, the capital cost can be written off on your income tax, but your house assessed value and taxes may also rise.

Not installing solar in this day and age is the only stupid option. Either lease or purchase, you make money.

[David Hufft]

I know that we have had several people in our area that have put in solar systems (on PG&E) that have had financial payback in 5 years or less! Also, in the U.S., it is "green equity" in your home so it is not taxed. The way to go is to get a home equity loan (at some of the best rates in history right now) and then pay on the loan what your electric bill used to be. Financing the system this way, I know of several people here that have payed back the loan in less than 5 years and then they OWN it AND they don't have an electric bill.

[DamonHD]

That comes across as heavily promotional.

I also don't believe the "don't have an electric bill" part, frankly.  And I've put up a few PV systems.

Please avoid this hype, and don't put promotional links in your profile; I've entirely deleted accounts for less.

Rgds

Damon

[David Hufft]

My apologies. I feel strongly about the leasing option. I have seen people get screwed in the end by leases and PPAs.

May I ask; why do you doubt "don't have an electric bill"?

[Bruce S]

David;
Since I'm here in the USA as well, let me help with your question to Damon.
In many states the power companies will NOT send you a check, NET metering means they will issue you a credit for the difference of what you put in versus what you take out.
After that depending on the contract, at the end of the month , quarter or year any possible credit you could possibly have left over is gone, NO state I've looked at allows credits to be held over to the next year.
Damon's pretty good at this having been on the inside of PV install for schools in his area of the UK plus his own at his home.
So he's fairly experienced with the "MAN" shall we say.
Hope this helps
Bruce S
DAMON ; sorry for missing this one my bosses bosses boss came to visit me  .

[David Hufft]

Bruce,

 True, most will not send you a check, but I wasn't talking about making money off of a solar system, I was talking about not having a bill at the end of the time parameter (out here with PG&E it's 12 months).

[Bruce S]

Then it would be possible to have an electric bill.
If you have a a sketch of concept for the" no electric bill ", it would be interesting to read.
There are several people in this forum who are completely off grid, either because the grid doesn't reach them or other factors.
I'm sure they like to read this concept as well. BUT I'm fairly certain they would tell you one way or another there's an electric bill, either to the power supplier or other factors.
I'm taking your end of time factor to mean the ROI period once the PVs are paid for in full.

Curious

[David Hufft]

Ah, I see what you're saying. There is a fee for the net metering program so even if you always end up with excess credits, and you're not paying for electricity, you do have a "bill". It costs $8 a month.

[dnix71]

Damon If David Hufft is out in California on PG&E they have him by the b@lls. There is a lot of outright criminal price fixing going on for many years. The industry group that allocates power has colluded to arbitrarily raise prices and cut off or threaten to cut off large areas of customers.
https://en.wikipedia.org/wiki/California_electricity_crisis
It's still going on http://www.mercurynews.com/pge/ci_21053334/electricity-is-cheaper-make-but-bills-are-still they are just more subtle about it.

Anything that gets you off the grid in that area is worth looking at. PG&E has neglected maintenance on it's gas distribution system and this happened https://en.wikipedia.org/wiki/2010_San_Bruno_pipeline_explosion They don't even know where all there pipelines really are.

The state of California is bankrupt. This is why http://blogs.sacbee.com/capitolalertlatest/2012/08/state-payroll-up-93-percent-costs-424-percent-in-last-decade.html and this http://www.forbes.com/sites/billfrezza/2012/07/12/california-cities-go-bankrupt-but-bullet-train-barrels-on/
This state is run by people who have committed treason. They spend money that does not exist while not paying their bills. The Fed is giving the state money under the table to pay for the shortfalls, just like they are giving Congress money under the table to pay for foreign wars.

[David Hufft]

True, California bureaucracy sucks! -driving back toward topic- All the more reason to work toward owning your own system. If PG&E cuts you off you still have something to work with. Then all you would have to get is an off grid inverter and batteries...or just buy a hybrid system in the first place **product plug warning** like Outback's Radian system.

[Lo_Volt]

Just figured that I'd update the thread and let everyone know what I ended up with. 

I went ahead and installed my own system.  I got a really good price on Motech 235 W panels (~$1.15/W which was awesome in 2012).  I had intended to use a SunnyBoy, but Solectria makes a 7500 watt grid-tie that gave me 500 watts more than the SMA.  It came bundled with the panels so I went that direction.  The system is ground mounted using an adjustable tilt mount from TTI. 

The total wattage of the system is 8460.  Total cost was right around $24k.  I had to hire a contractor to plant eight 4 inch posts in the ground for the mount.  That took 2 foot diameter holes 5 feet deep and filled with concrete.  I also paid an electrician to hook up the AC as that was the easiest way to get the county inspector to pass it.  The federal tax credit was ~$7200 and the state of Maryland gave me $1000 as well, bringing the total to ~$15,800 after subsidies.  Maryland's SREC market still has the SRECs selling for $130-140 and I've made 22 so far.  Barring any repair costs, I'm on schedule to pay it off in another 4-5 years. 

The system has been running for two years now.  I've run a surplus since the first month but I still pay $8.34 per month to Delmarva Power, but for the past two years I've returned enough surplus to cover that.  They net meter and settle out the difference every April.  They send me a check with the difference.  It's around $.08/kWH whereas if I'm buying electric I'm paying closer to $.11. 

I formerly heated my hot water with oil, but with this system, I installed an electric water heater that allows me to turn off the burner.  I used to use about 100 gallons of oil from March to September just to heat water.  At around $4.00 per gallon, it's nice not bothering with that.  This summer has been mild enough that I'm still running a big surplus.  I don't expect that in the future if we get hot in May and June as the air conditioning draws power. 

My maximum production day was actually in January of this year as we had a cold spell where the temperature never made it above 10 deg F.  It was a beautiful and cloudless and despite being a short day, I still generated 62kWH!