Solar Energy has been around for decades, but the popularity has grown by leaps and bounds over the last few years.  Solar is propping up in more and more conversations, in news articles and on the web.  The popularity of renewable energy in general reminds me of the dot.com boom of the late 90’s, which I also had the pleasure of working in.  The major difference I see between the dot.com boom and renewable energy boom is that I see a lot more value spread across the renewable energy field.  There is less “flash in the pans” if you will. Now that does not mean that solar does not have its share of flakes…just not as many. 

Today, we are going to discuss strategies for picking a solar energy installer so you can weed through the pretenders and find the right installer for you.  First off, there are many installers out there that are starting out - they may not have a huge body of work, but they are very well educated on the science and design of solar.  These installers are not to be discounted.  Secondly, there are a lot of general contractors/electricians/hvac guys out there who are successful in their field and have a large body of work in their specialty but did not take the solar courses and do not know an azmuth angle from their az and have little to no solar experience.  These installers are not to be given too much credit for non-solar work.  So my first two pieces of advice for picking an installer revolve around one thing - education.  There are plenty of solar install courses out there and if your installer has not taken one, then chances are that the design of your system will not be optimal and you will be paying for a system that does not yield the maximum amount of power possible.

 Next are industry standards.  The unwritten rules for solar installation is that the installer takes care of all aspects of the install from the initial site survey, to the design of the system, to the coordination and management of electricians, structural engineers, crew required to handling all the paperwork, permitting, rebate applications, through the install and meeting with town/state inspectors after the job is complete.   The way the industry has grown, the installer is the one stop shop that will handle all the above.  Like any contractor, the installer may sub-contract portions of the project (which is completely normal), but the contractor is still fully responsible of all coordination and supervision of the project.  You, as the customer should not be coordinating all the sub-contractors.  More than likely, your installer follows this unwritten rule but it is always good to check during your initial meeting with the installer.

Which brings us to the incentives.  As we reviewed in a previous post from SunBlue Energy (Stimulus for the Rest of Us), the US government offers a 30% tax credit on all renewable energy projects with no project cap.  Your installer can assist you with filling out the tax credit, but the installers’ responsibility ends there.  Your accountant should be briefed on all the incentives and provide you an overview of the tax implications prior to your purchasing the system.  Solar is an extremely good investment so make sure you are maximizing the incentives as they pertain to you.

 Now that we have covered federal tax credit, we can move on to the state incentives.  Each state/region has different incentives.  In many states, a rebate requires that the installer fill out an application for you.  Once completed/submitted by the installer and approved by the state, you are ready to rock.  It is important to note that certain state/regional rebate checks are sent to the installer and therefore covered by the installer as a portion of the deal.   Make sure you check your local state rebate to confirm that this is the case.  If it is, then there should be no reason for you pay to for that portion of the project.  The rebate check will be simply sent to the installer after completion.

Above are all a few specific tips for picking a solar energy installer.  When it comes down to it, you are hiring a contractor to handle a home improvement.  So the most important rules to follow are those that you would follow for any other contractor. 

·        Make sure you get at least 2-3 quotes

·        Confirm that the contractor has the proper license and insurance required

·        Ask for references and make sure that there is a contractual agreement in place that outlines the work to be performed, price and progress payment schedule. 

·        It is also important to outline what is important to you - local guy, smaller company, tall dark and handsome, lives in Sleepy Hollow, NY, runs a company called SunBlue Energy, whatever your preference.

Stay true to yourself and if it smells fishy, then go to the next installer - there are plenty of fish in the sea.

Contributor: Christopher D. Hale, Owner at www.SunBlueEnergy.com

The system was approved today by the town building department.   The last hurdle is the utility company putting in the bi-directional meter.   There are 7 switches to flip to get this working (picture attached).   For the building inspector test run, it was producing 4.3 KW of power at 10:30 AM on May 11, 2010.   We still have some trees to drop so it gets more sun in the early morning and late afternoon.   What I’ve learned doing this - PATIENCE.   It is a work of art though and well worth all the waiting.

This is the first complete alternative energy project for Cheetah Power. The house only needed 3kw of power, however, the utility company gave us a rebate for a 6kw system so the solar installation company figured out how to put up another 3kw. We are going to be using the extra power to generate heat and electricity for green houses to grow citrus fruits. This is part of our expanded plan to become not only energy self-sufficient, but food self-sufficient as well. For a $22k investment (this includes state and federal rebates and incentives), we’ll save $84k in utility bill fees over 30 years. Additionally, we’ll be positioned to weather the increases in food prices due to the rising oil prices.

I have been working the alternative energy scenarios on my Connecticut property this past year.  When I started, the State of Connecticut was no longer doing the individual incentives for solar power.  While I was in the process of installing a 6kw solar system, they reinstated their program.   I put my project on hold, applied for the rebate and was awarded a $9071 rebate for my 6KW system based on the amount of energy it’s going to generate (which is pretty close to 9071 KWH per year).

To increase the amount of power my panels were going to create and get the maximum rebate possible, I had to chop down one tree (in a stand of about ten other trees).  Small price to pay.

I reran my payback analysis figures based on today’s scenario.  It came out that they system would pay for itself in 15 years.  The expected system life is 25 years.  I will keep the house until the market goes back up within the next 20 years (it’s bound to happen - CT has experienced two real estate “corrections” of this magnitude in the past 30 years).   This is still the best place to park my money for creating a retirement nest egg.

It is going to cost me a little over $28k to install the 6kw solar system.   Based on what else I could be doing with that money, this will generate a 4.5 x better return over 20 years than anything else I could be doing with my money right now.   Even the safest place to park your money - US Treasuries adjusted to keep up with inflation - the solar panels still generate a 2.3 x better investment.

In Michael Porter’s book on Competitive Strategies, he talks about the competitive forces that shape an industry.   One of the main competiitve forces that impact almost every industry is the source of their energy.   The more options businesses create for their sources of power, the more competitive they will be long term - espcially with respect to other companies in their industry.  

This point was brought home recently by a business I have been working with on assessing, aligning, and expanding their energy options.  The company is a small speciality grocery who has seen his electrical bills go up from $700 to $7000 dollars over the past 20 years while his overall consumption has decreased due to efficiency improvements in his refrigeration.   When deregulation went into effect, he was able to get a lower electrical rate from an out of state provider, yet had to still pay the local carrier for delivering the electricty.   And then last year with the dramatic increase in heating oil prices,  it was the first year his company didn’t turn a profit.  

With electrical rates expected to experience a simiar increase over the next 20 years.  and the impact of volatile oil prices on his long term viability,  the business owner wants to develop his own power solutions.   The more options he can create to power his store, the less he will pay for his power, the more competitive he will be and the lower he can charge for his products or the more profit he can make on the products he charges that are in line with his local competitors.  

Through the Project  Energy Independence course, we are looking at two solutions - one for creating his own electricty with roof solar panels and another for heating his store with a removable wood furnace.  He doesn’t own the store so any solution he selects, he wants to do it with minimal infrastructure changes - these two solutions enable that.   There is a  whole foods store in a community 25 miles away that is using a fuel cell as a back up electrical generator - we are looking into some grant money to explore that option.

I’ve been evaluating the various ways to power properties in three different locations over the past several months and have found a bewildering number of options to do just that.  Some are still in the twinkle in the eye phase of development, others are more proven, but my gosh the price tag makes you feel like you’re underwater gasping for air. Basically anywhere you live you need power for three functions:

1. Run Electrical appliances.
2. Heat and Cool Your Dwelling
3. Get you from point A to point B.

So here are the three locations I’ve been evaluating, the options, and the feasibility of those options.

Alaska - this property is on the Lynn Canal - a very deep fjord about 70 miles northwest of Juneau.    The local population is very pro-environmental so there is wide acceptance for doing alternative energy solutions.   The property actually just got on the grid less than ten years ago so it is already set up to be off the grid.  It has a large 20kw diesel generator that powers the main house and three outbuildings that includes an apartment.   It used to house a very large windmill in a field and the wiring still exists to the main generator shed. The home and hot water are currently heated with a diesel furnace.   Propane provides cooking fuel.   There are options to put in a geothermal heat pump system.  The piping can either be run underground or can be placed out in the water.    The approximate cost to do that is $20,000.  Current heating oil costs on that site are $5000 per year.   The site also has strong gusting winds sometimes over 70 MPH.   There is a 5kw windmill by Helix Wind that can handle wind from all directions and large gusts.    The cost is approximately $20,000.    Current electrical costs are $4000 per year.   Reducing the electrical usage is somewhat difficult as the custom home was built using approximately 14 different types of light fixtures.  It is not an easy matter of just replacing incandescent bulbs with florescent bulbs - most of the light fixtures need to be replaced.  There is also a green house that has high wattage metal halyide lights.   

To modify the home’s heat and electrical sources is possible, but may not be desirable.   The windmill would be the easiest to implement solution since the electrical system is already set up to be off the grid.   The Geothermal Heat Pump system would be considerably more difficult as there are no qualified installers in the area and doing the piping into the water, even though it is a closed loop system, would require special permitting and may not be allowed.   Doing a horizontal or vertical closed loop ground system would also add considerable cost to the installation and significantly alter the natural landscape on the property.   There is another alternative to use the existing infrastructure of both the diesel generator to create the electricity and the diesel furnace to heat the home - that would be to create algae oil.    But from what I’ve seen on the algae to oil tools - this is not an easy task and there are not currently off the shelf solutions to make oil from algae.   My initial step is going to be to install the windmill and keep experimenting with the algae biofuel alternatives.    The algae biofuel would also be used as fuel for the diesel truck and tractor.   I could put in a larger 100kw windmill and use the excess power to create hydrogen for a fuel cell car - however there are no technicians in the area with hydrogen or fuel cell experience so maintaining a fuel cell vehicle up there over the long term would be more difficult. The town has told me if I set up my own power company, they do have to purchase back my electricity at their wholesale rate. But they do not do net metering.

Nevada - there are two properties in Northern Nevada on the eastern side of the Sierra Nevada range.  The first property is a small home in a tract neighborhood.  The options for this house are limited to solar panels on the roof and possibly a very small windmill.   For this home, we have already replaced all the light bulbs with low wattage florescent, installed a tankless hot water heater and added an energy efficient natural gas fireplace.   The other property is on a south facing hill with ample space for solar panels.   It already employs a passive solar design, and was designed using low wattage light fixtures, and tankless water heaters.  We have designed solar awnings, a portable solar carport, are putting solar panels on the polar king freezer trailer and can ground mount at least 50kw of solar panels on the 2 acre hill behind the house.   The property also gets winds up to 30 MPH from the valley floor for half the day.    This property is also well suited for a geothermal heat pump system but because of the passive solar design and the airflow characteristics, the home has minimal heating and cooling needs as it is.   The excess electricity generated on this property could be used to create hydrogen for a fuel cell vehicle.  The area has numerous people who are technically qualified to help with a fuel cell vehicle.   The plan for this property is to first install the solar awnings as that will reduce the cooling needs of the house.  Then install the portable solar carport and put the solar panels on the polar king freezer.   The next step will be to install a 5 KW windmill and then work on the hydrogen creation system for the fuel cell.   Depending on the needs for the hydrogen fuel cell system, we may install more solar panels or windmills.

I’ve also been evaluating some other novel energy storage concepts for the Nevada property. Research Scientists at Worcester Polytechnic Institute have found a way to use asphalt to capture solar energy to heat a liquid. There are some other fascinating ways of very inexpensively using the sun’s energy on vacumn sealed tubes heating liquid mounted flat or in a trackable concave mirror. With both of these combined, they can circulate liquid through a tank that then uses that liquid in the tank to run a waste heat generator for electricity. After the water goes through the waste heat generator, it gets returned to the hot liquid sink to be heated up again from the asphalt and the concave mirror solar energy collectors. Electratherm, the manufacturer of the waste heat generator, said they were going to be rolling out a 5kw system by the end of 2009. The benefit of this system is it would also keep the driveway hot for snow melting in the winter. The key would be to use a non-toxic antifreeze in the system.

Connecticut - This property sits on a west facing hill.   There is ample space for ground mounted solarpanels facing south.   We priced a 6kw system which would cover the electrical needs of the home.   The installed costs would be 50K.   There is also ample space to install a horizontal piping geothermal heat pump system.    The house is a passive solar design as well so the geothermal heat pump would work well for the cooling needs in the summer but it may be inadequate to for the heating needs in the winter.   More evaluation is required - however there are other people in the area employing geothermal heat pump solutions and there are qualified installers in the area.    We may be selling this property within the next year or two so we have put the energy self-sufficiency projects on hold.   Homes in the area are not selling at even their market value so making improvements on this property doesn’t make sense at this time.

When looking at creating your own energy, energy storage is a big issue. With solar power, you’re only creating power when the sun is shining. With windpower, when the wind is blowing. With hydropower, when the water is running. It’s a basic energy source, energy sink issue (a sink is how you use or store the energy).

To date, most people have been using large banks of batteries for energy storage associated with alternative energy. Batteries are the weak link in the whole system (and the most toxic). They have about 1/5th the life of the solar panels for which they store energy.

Larger power companies are developing larger power storage schemes. The question is, can the individual use some of these energy storage schemes as well? In the picture below, the company SolarReserve uses mirrors to focus the sun on a large stack that converts salt to liquid and then uses the hot liquid to run turbines to generate power. The liquid salt holds the heat for much longer than the conventional steam turbine solar thermal designs.

Yesterday, February 12, 2009 was a worldwide Twestival for Clean Drinking Water. This was where people who use Twitter to communicate with each other, got together in over 175 cities worldwide to raise money for clean drinking water initiatives. Cheetah Learning raised $2300 for Clean Drinking Water by donating 5% of revenues made for the day from their Twestival activities to teach people how to do project management for clean drinking water projects.

Obtaining clean drinking water requires power. It requires the power to get the water up from the ground and it requires power to make sure the drinking water is free from disease producing microorganisms. One of the ways to better insure that there is adequate clean drinking water is to adequately process waste water. This takes even more power. Yes you can use some low power methods to adequately process waste water, but modern day methods that insure far better processing for preserving clean water requires tremendous electricity.

The Hill Canyon Waste Water Treatment Facility in Thousand Oaks, CA uses solar power and methane to power it’s waste water treatment facility.

The solar power system cost $1.5 million to install and produces about 15% of the treatment centers power. The solar power system is owned by Renewable Ventures/MMA and sells electricity to Hill Canyon Wastewater Treatment Plant for 16.8 cents/kW. The methane system uses methane gas from the facility’s anaerobic digesters to power (2) 250 kW generators. This system cost $.5m (1/3 the cost of the solar system) and provides approximately 45% of the facility’s energy needs. This system is owned and operated by U.S. Energy. The Hill Canyon Wastewater Treatment Plant purchases this electricity at a rate of 6.4 cents/kW.

This is very interesting that the methane system cost 1/3 as much as the solar system and produces 3 times the electricity. What I love about this story is that it is the waste they are processing that creates the largest percentage of electricity to process that waste.

The inverse relationship between money spent on the system vs. the energy produced appears to be a universal truth as I have seen it in existence in many other realms. The engineers perpetual question is - how can I spend the least amount of money and get the maximum energy out. The engineers managing the Thousand Oaks facility are doing a fantastic job with answering this question.

There are some fascinating schemes out there to use solar power for your electrical needs with very little upfront investment - some appear more ready to go than others.   I was looking at CitizenRe’s approach over the weekend.    This is where they have set up an army of “ecopreneurs” to sign up home owners to have solar panels installed on their homes for a security deposit of $500 and then they have them pay a rental fee for their solar panels that is the same rate as what they are currently paying for electricity.   They get to lock in their electrical rates for the duration of their contract which can go up to 25 years.  Damn this looks like a very attractive offer.

HOWEVER, I didn’t see in their marketing material where  they have installed one solar system yet.   Now if you’re just getting into this concept,  you might think this is a new idea - but they have been around a LONG TIME - especially in terms of today’s technology time frames.

I was researching what others were saying about Citizenre and found this blog post written two years ago about Citizenre.    They were supposed to have their manufacturing facility up by September 2007.   Two years later, they are now claiming their manufacturing facility will be online by Jan. 2009.  I did not see any mention of it on their website and all their marketing material is still talking about not making any promises to people who you get signed up about an installation date.   So it appears they have missed this deadline as well.

One of the things they do emphasize in their marketing materials is that if people have the ability to put solar panels on their homes and pay the upfront costs, they should by all means do this.   They suggest people visit www.findsolar.com to find a solar installer in their area.

If you really want to do solar but you can’t afford the upfront costs, there are other ways to get into this for low cost - finance it with a home equity loan, or go with a long term lease that some of the larger solar installers offer.  They have it set up where you end up paying the same amount as you are for your electricity as well.   And at the end of the leasing period, you own the panels.  We are summarizing these plans in our March Newsletter.

If you want to go solar, I’d recommend you go with a company that can deliver on that arrangement today rather than waiting for a promise to deliver sometime in the future.  If Citizenre can deliver on what it promises, it will truly be a remarkable company.   I am hoping they succeed.   In the interim, I’m going to continue with the approach on designing and installing my own systems on my properties and figuring out my own creative ways to finance the installations.

For the past six weeks, I’ve been doing feasibility analyses for adopting solar power for properties in Nevada, Connecticut, and Alaska.  Here are some of the barriers I’ve discovered:

1. Reliability of Installers.   I have talked with no fewer than ten installers in two states.   All were very lax in returning my calls (they must be swamped).  For those that did return calls, they had convoluted return phone call systems where I never actually got to talk with a live person when I attempted to call back.  For the five I did actually meet in person to get bids to help me put solar panels on my property, NOT one, and I am not kidding, NOT ONE bothered to follow up with a bid.  Maybe a homeowner considering two systems for two properties - 3kw and 5kw is just not worth bothering with.   Anyone who wants to get involved in this industry who understands the basic of service delivery will clean up as the people I’ve met currently playing in this field are not customer focused.   

2. Availability of Panels.   Several installers told me that it was three to six months out to get the panels and forget about obtaining the high efficiency panels - the supply just can’t keep up with the demand.  I was ready to purchase a 3kw system from one company but when I went to call them back to place the order, their phone had been disconnected.   What is interesting about this, there was a NY Times Article Feb. 3, 2009 that said there was a glut of panels on the market.   Where is this glut?   Maybe with the lower efficiency panels - I can understand that.   I’m going to the North American Renewable Energy Conference in Vegas in March - I will try to find more reliable suppliers there.  If they are really hurting for money, you’d think these folks would be beating down my door.

3. Capability of existing designs.  This is a hot research field and people are discovering much more efficient and creative ways of converting the sun into electricity.   Solar dyes are one hot field where they can tint windows, wall coverings, shades, etc to collect solar energy.   

4. Availability of Grid Tie Systems - In Nevada and Connecticut you can tie into the grid and get credit so it makes it more cost effective to use solar panels.  In Alaska, you can tie into the grid, but you cannot get credits for the electricity you put back into the system.   

After doing my research and learning what is involved, my decision is do one installation on my own to learn more (and possibly see about creating a system for people to learn how to run the business of installing solar systems).  But before I make more investments on a wider scale on more properties, I am waiting until some of these new innovations are available commercially and the industry is more mature. 

According to: The program manager of the U.S. Department of Energy’s Solar Energy Technology Program for Energy Efficiency and Renewable Energy, John. Lushetsky, 

“To go from the 1 gigawatt of generation capacity that we have now [in the United States] to the 170 to 200 gigawatts called for by 2030 amounts to a 26 percent compounded annual growth rate over the next 20 years.  That’s a higher sustained growth rate than any industry has ever been asked to do before.”  

This was referenced in an article titled “Unprecedented Growth Seen for Solar Energy.”   The article should be titled, “Unprecedented Growth Required for Solar Energy.”