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Crunching the Numbers on Going Solar

September 23rd, 2008 at 02:18 pm

We're considering adding solar power to our house, in two ways; photovoltaic cells to generate electricity, and a solar hot water system. This also means upgrading the electrical panel in our 96-year-old house.

The total cost will work out to be about $30,000 Cdn. (We can do it in four phases - roughly $3K for the electrical upgrade; $11K for the first KW of PV; $9K for the next KW; $7K for the solar hot water.)

Because we live in Canada, we can't do the cheaper methods of solar hot water, where the water itself is circulated up to the roof. We have to go with the more expensive glycol-circulation type, where an anti-freeze-like substance is circulated and brings heat down to the basement to heat the water.

We pay about $85/month for electricity. We'll tie the electrical into the Toronto Hydro grid with their Standard Offer Program, which might allow us to actually get money back when we generate more electricity than we use. In the simplest scenario where we pay nothing for electricity, it's going to take at least 20 years for the system to pay for itself.

There are two big incentives for me to go ahead and do this, since the payback is so long it's not really incentive;
1. It's the right thing to do for the environment.
2. This is a perfect example of a way to pay now, while we have income, to cut our household expenses when we're retired. If we don't have to worry about electrical price increases from 2016 to 2060, that's one less thing to worry about and plan for.

EDIT: scfr brings up a good point, about tax rebates. We can get the provincial sales tax (8%, or $2400) reimbursed, and there are $1000 in provincial and federal rebates available on the solar hot water system.

4 Responses to “Crunching the Numbers on Going Solar”

  1. thriftorama Says:

    We're thinking of doing the same thing. Sure, it's nice to have a lower electricity bill, but global warming is our number one concern. We're hoping in two years to install panels. Now, we are focusing on becoming more efficient, so every watt we get counts.

    For hot water, you may be better off skipping solar and looking at a geothermal heating and cooling system. We installed one last summer. It is a highly efficient furnace and air conditioning system and it heats our hot water for free in spring and summer. It's cheaper and more efficient than solar hot water heating, and it you need to upgrade your furnace, it just makes the most sense. We paid $12k for the new system, and it's saved us $200 or more a month on heating and cooling, not even counting the water heating savings!

  2. Broken Arrow Says:

    Yeah, I like the idea of going solar some day.

  3. scfr Says:

    In Canada, can you get tax credits for making those kinds of changes?

  4. baselle Says:

    We did this at the farmette, also a house in the 90 yr range. A few thoughts:

    You might be quite disappointed at the amount of money the utility company will give you for your excess power. They charge you retail rate, but will give you a wholesale rate. The extra check is better than nothing though.

    We were out in the boonies, so to prevent thievery of metals (copper wiring), we dug a trench for the wiring. A bit of coin there.

    The electrical upgrade of the house (very, very necessary - it was 70s aluminum wiring (!)) cost nearly the amount of the solar itself.

    Replacement costs - the solar panel is like anything else, after twenty years it will break, etc. With any luck, solar panels will have improved and the costs drop.

    Not saying good or bad, just with any new construction, the practical is very different than the theoretical.

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