A Year On: Did the Panels live up to its Expectations?

It has been a little over a year since we installed our solar panels (also referred interchangeably as PV systems) on our roof with a promise to replace 100% of our electric bill. The offer looked too good to pass and the panels started cranking clean energy starting April of last year (April 13, 2012 to be precise).

A year on, the question is 'has it fulfilled its promise' ? In the spirit of transparency, let me share some real data and you can judge for yourself.

The System

First, a little bit about the system: It's a 5.59 KW DC system leased for 20 years from Solar City for a net upfront cost of $6321. The installer promised no more cost for next 20 years to come as far as maintenance etc for the panels are concerned and guarantees energy generation up-to 90% of its claim on the annual basis with 1% decrements yearly on the guaranteed kwh as the panels age.

Other details of the systems are:

• Panels: 26 Kyocera (#KD215GX-LPU) panels of 215 Watt each
• Inverter: 1 invertor Sunny Boy 5000-US
• mounting system: Solarcity Canopy -C 6"
• 20 years lease upfront cost with no monthly fee: 
• paid upfront: $6321
• Might get county property tax rebate of $3160 (about 5 year wait)

The Expectation

Below are the snapshot of our yearly electric consumption just before the panels were installed:

Bill Date	days	Electric Usage (kWh)	Electric Charges (distribution)	Alternate Supplier Charges	Total Charges	Effective energy rate ($/kwh)
2/23/2012	28	446	$31.29	$39.25	$70.54	$0.16
1/23/2012	35	390	$28.55	$34.32	$62.87	$0.16
12/21/2011	30	294	$24.95	$25.87	$50.82	$0.17
11/21/2011	29	421	$30.43	$37.05	$67.48	$0.16
10/21/2011	32	347	$17.52	$30.88	$48.40	$0.14
9/22/2011	30	560	$24.65	$49.84	$74.49	$0.13
8/19/2011	29	884	$36.16	$78.68	$114.84	$0.13
7/22/2011	32	832	$36.27	$74.05	$110.32	$0.13
6/21/2011	29	547	$26.07	$48.68	$74.75	$0.14
5/23/2011	30	332	-$13.18	$29.55	$16.37	$0.05
4/21/2011	31	413	$29.86	$36.76	$66.62	$0.16
3/23/2011	30	432	$29.19	$38.45	$67.64	$0.16
Total	365	5898	$301.76	$523.38	$825.14	$1.69
Average	30.42	491.5	$25.15	$43.62	$68.76	$0.14

Meaning our monthly bill were averaging $68.46 and we were consuming 491.5 kwh (monthly or 5898 kwh annually. The 5.59 kwh PV system that we signed for were supposed to generate about 9900 kwh/yearly with 4.86 hr sunlight average in our area (Maryland, US) as

5.59 kw * 4.86 hr * 365 days = 9916 kwh.

but since we consume less than 6000 kwh yearly,  we expected our bill to be completely 0 or even negative.

The Reality

So did the system produced what it was designed for ?

Not really. Looking at the solar city customer portal, which by the way, has a good feature rich customer front end to track their energy generation, this is what I see for 2013 and 2013 respectively,

that is it generated about 7027 kwh in its first 365 days cycle, much better than what's solar city guarantees (6212 kwh in year 1 and 6150 kwh on year 2 and so on, i.e. 1% lesser production guarantees in successive year) but less than what it informally promised. Now, to be fair no one has control over how much sunlight you will get and that's why they probably guarantee way lower than what the system is capable of producing..

The Dollars

Now what does this 7027 kwh of electricity generated  translates into, in terms of Dollar ? How much money it actually saved and what's our payback period ?

For this I needed to re-look into my electric bills from Pepco. And that's one piece of the most complicated numbers maze I have ever seen; even more complicated than our phone bills. 

Electric bills in Maryland has several parts and complicated formula; on peak, off peak and intermediate rates. And then for each such slab, you have the distribution, transmission and generation charges. And then tons of small fees or taxes and surcharges. And latly, there is also one big charge called customer service charge of about  $14.56 each months whether you consumed any electricity that month or not . 

Complicating this even further, In Maryland you have a choice of picking your own energy supplier which generally appears very promising since you can buy electricity from them at a predefined lower rates for years to come without any commitment or any penalty for early termination. And sure enough, that's exactly what I had done to complicate my life further :). I had signed up with WGES to buy electricity from them at 8.8 cents/kwh. 

So what does that mean ? Does that mean that by producing 7027 kwh of electricity I saved myself 8.2 * 7027 cents of bill from WGES ? Actually more than that. Since that 8.2 cents/kwh is just the generation part. Producing your own electricity also saves you from transmission and distribution charges.

For this let us look at stack of our last year bill again: $68.76 monthly with $14.56 as connection charges for 491.5 kwh of electricity monthly (all average numbers). Meaning I was paying 53.50/491 = 11.02 cents/kwh

So, what it meant was that last year our panels saved worth 7027 * 11.02 cents = $774 on our bill. So an investment of $6321 should be paid up in next 8.16 years. 

The Dilemma

The dilemma comes from the observation then that our bill still didn't' just go away. After all, the system generated over 7000 kwh of electricity whereas we were consuming less than 6000 kwh  yearly. 

The reasoning for that is 2 folds: 

First, even if you don't' buy no electricity from your supplier, i.e. don't switch on even a light bulb, you still will be slapped with the above mentioned 'consumer service charge' of about $15 a month. 

Second, installing panels, even if designed for 100% of your current capacity, isn't a license to do whatever you want and still expect to live bills free :) The system is just there to generate energy. If you start consuming more than it generated, that excess has to come from somewhere and its' not free. 

And in all fairness that's exactly what happened  to our case. We consumed  a lot more energy this year due to some life events (new local job, new addition to family etc.) and sure enough, there was a bill for that. 

Here are snapshot of our 2 yearly usage and bill summary; one before and one after the PV systems:

The Conclusion

So again, did our bill just vanished ? Not yet. Did it reduce it,  yes, it did by about $45 ($68 vs $23). Did we consume same energy as the year before ? I wish but in fact we consumed about 42% (5898 vs 8403 kwh) more electricity still paying $45/monthly less.