Thursday, January 04, 2007

Solar energy: attractive but not practical yet

Last year we decided to do some research on solar energy for our home. We happen to have a roof that is nicely oriented to the south, and doesn’t have any leafy trees obscuring the rays of the sun.

Minnesota’s solar resource is said to be as good as Austin, Texas or Jacksonville, Florida. According to this map (http://www.nrel.gov/gis/solar.html), that is true. But sunshine states like Arizona, California, and Nevada, are clearly the prime locations, with larger numbers of predictably sunny days.

We asked a solar contractor to come to our home and evaluate it for solar panels. Here is all the practical stuff we found out: a grid-connected 2 KW solar array would take care of approximately ½ the electrical energy needs of our household. Our household consumes 6,800 kilowatt hours (kwh) per year, somewhat below the national average in the U.S. of 10,654 kwh.

The cost of a 2 KW solar array would be $18,000. Minnesota provides tax credits of $2,000 per KW, so that would reduce our cost to $14,000. This is assuming we could get the tax credits. The State Department of Commerce’s website says that they have a backlog of applications waiting for the funds available. The federal government would provide an additional credit of $2,000. That would reduce our cost to $12,000 upfront.

Electrical energy costs an average of $.077 per kwh. This means our annual electrical expenses are $525. An investment of $12,000 would cut that cost in half, to $262.50. Even if electrical costs continue to increase by about 7% a year, as they have over the past 6 years, it would take a long time to pay off our investment.

The biggest cost is constructing solar arrays is the cost of silicon, a mineral found in sand. According to InvestorIdeas.com, solar-grade silicon is expensive to make, and prices pf silicon have increased from “$25/kilogram in 2004 to around $200/kilogram in 2006.” This is having a negative impact on the growth of solar power.

A friend of mine has a house that is completely off the electrical grid. Between Christmas and the New Year, we had a string of extremely cloudy days. His batteries got very low because he was unable to produce any solar power. He cheerfully got by with candles, but admitted that his wife was not as good-humored about the inconvenience. This same friend informed me of a new technology that hasn’t reached the commercial level. A company called Prism Solar Technologies in New York has apparently developed a method to concentrate the rays of the sun using holograms. This could cut the cost of solar modules by as much as 75%. Expect investor frenzies to follow any new technologies that can bring down the price of solar.

Until these new technologies become practical, solar energy is only a solution for the most environmentally motivated and well-heeled homeowner. This is one reason why those of us who want to cut our contributions to global warming must find other ways to do so. I’ll have more to say about this in the days ahead.

1 comment:

Unknown said...

Solar energy is the best natural resource that we have this time even more that fuel is too expensive. In fact i want to approach costa rica investment opportunities and look all the alternative this country can have because it climate. We must to find the way to save our planet and to use solar energy could be the first step.