The good news is that solar electric systems make good financial sense for most California homeowners, as well as those in many other states. For California residents with a $70 or larger monthly electric bill, it is likely they’ll see: pre-tax equivalent rate of return of 10% or more; greater savings on the electric bill than a loan would cost; and home equity increasing more than the system costs. High Electricity Rates and California’s tiered rate system (with top rates of 49¢ per kWh) penalizes residential customers for high electric usage.

Net Metering allows a homeowner to get retail value for each kWh produced. Excess summer and daytime credits that were “sold” to the utility can be used up at night and in the winter. The utility becomes a battery that can store energy for up to a year. On Time of Use (TOU) rate schedules, electricity value depends on the time of day and year. The PG&E E-6 schedule has peak rates during summer weekday afternoons (29¢/kWh) and off-peak rates (as low as 8¢/kWh) at other times.

Combining Net Metering with TOU allows a solar customer to “sell” back power to the utility during peak periods at the high rate, and buy back during off-peak hours. Most solar electricity is produced during peak hours. The customer gets more value for the same kWh produced, and needs a smaller solar system to offset their electric bill. Afternoon shade must be avoided due to the higher value of afternoon electricity.

Systems are eligible for the Federal Tax Credit of 30% (no limit).

By | 2015-09-24T17:49:19+00:00 September 29th, 2014|News|6 Comments

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6 Comments

  1. Stephen November 13, 2014 at 6:22 am - Reply

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    good.

  2. max November 14, 2014 at 5:40 am - Reply

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    thanks for information.

  3. wealth building March 6, 2015 at 8:23 pm - Reply

    Informative article, exactly what I wanted to find.|

  4. MichaelPn November 2, 2015 at 8:18 am - Reply

    Sierra Solar takes every step for you to power your home or business with solar energy, from design to installation and ongoing monitoring. We make it easy and affordable to go solar with our competitive prices and uncompromising service.

  5. solar panels November 18, 2015 at 2:35 am - Reply

    Very descriptive article, I enjoyed that a lot. Will there be a part 2?

  6. Виктор December 14, 2015 at 10:04 am - Reply

    Almost everybody can afford some level of solar power, says Williams. Also, be sure to take all the smart energy efficiency steps first, so your solar system can better cover your now much-lower energy needs.

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