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Help crunching the numbers...

post #1 of 10
Thread Starter 

I'm trying to make some rough calculations about the cost of putting in a solar power system at work, and am hoping someone can tell me if I am doing this wrong, because the cost seems prohibitively expensive the way that I am calculating it.

 

I'm assuming two things (taken from a MN government publication on solar power) - that the cost is about $10/w ($10,000 per kW), and that 1kW system provides 1,000 kWh each year.

 

Our department currently uses 80,000 kWh a year (9,950 w running 365 days a year), so we would need an 80 kW system. At $1,000 kW installed, even with the Federal and State tax incentives that is still $550,000... spread that over 15 years, and it's $35,000/year. Grid electricity is only $7,900 a year. :(

 

Am I doing something wrong in my calculations?

 

 

post #2 of 10
Thread Starter 

Ps - The County we are in is rated as "Good" and gets an estimated 4.584 kWh/sq-m/day.. so I guess sun isn't a concern in MN

 


Edited by kiwi - Tue, 22 Jul 2008 22:31:35 GMT
post #3 of 10
Quote:
Originally Posted by kiwi:

 

I'm assuming two things (taken from a MN government publication on solar power) - that the cost is about $10/w ($10,000 per kW), and that 1kW system provides 1,000 kWh each year.

 

Our department currently uses 80,000 kWh a year (9,950 w running 365 days a year), so we would need an 80 kW system.

 

 


 

I think your error might be right there.  If you use 80,000 kWh per year, you're using an average of 220 kWh per day.  To estimate the array size you need, you divde your daily energy demand by 4, so you get about 55 kW of panels to meet your demand.  So that's closer to $380,000 including the tax incentives, or $25,000/year over 15 years.

 

But solar prices are dropping pretty rapidly.  In a few years that cost could be significantly lower.

post #4 of 10
Quote:
Originally Posted by kiwi:

I'm trying to make some rough calculations about the cost of putting in a solar power system at work, and am hoping someone can tell me if I am doing this wrong, because the cost seems prohibitively expensive the way that I am calculating it.

 

I'm assuming two things (taken from a MN government publication on solar power) - that the cost is about $10/w ($10,000 per kW), and that 1kW system provides 1,000 kWh each year.

 

Our department currently uses 80,000 kWh a year (9,950 w running 365 days a year), so we would need an 80 kW system. At $1,000 kW installed, even with the Federal and State tax incentives that is still $550,000... spread that over 15 years, and it's $35,000/year. Grid electricity is only $7,900 a year. :(

 

Am I doing something wrong in my calculations?

 

 

 

I wrote a good post on calculating the economics of solar pv:

 

blog.gogreensolar.com/2008/07/calculating-economics-of-solar-power.html

 


Edited by gogreensolar - Wed, 23 Jul 2008 08:46:30 GMT
post #5 of 10
Thread Starter 

Cheers guys - this helped a lot, and I think the City is going to seriously considering putting in a decent size solar system.

 

Thanks again! :)

post #6 of 10
Quote:
Originally Posted by kiwi:

I think the City is going to seriously considering putting in a decent size solar system.

 

Awesome - good luck with that!

post #7 of 10

Hi Kiwi,

 

I have a solar system, and I can tell you that your calculations are WAY off.  You will need about 50-60 panels to meet your needs of 220 KWh per day.  Also, you have not specified if your system would be connected to the grid with an inverter.  Using an inverter would be far less expensive that using a battery system, which would be very inappropriate in your case.  Your infrastructure must be tied to the grid because of the number of days that are overcast (rainy days, etc) in your region.  Otherwise, you will not have enough electricity to meet your needs in the winter and on cloudy days. The solar system, in fact, will not totally replace your electrical needs  -- but it would replace about 70%

 

My best guess is that the system would cost about $400,000.  Over 14 years, it will work out to about 13 cents per kW.  That's how long it would take to break even at current prices for electricity.

 

More important -- get an energy audit from your utility company first.  You should take steps to reduce energy use before investing in solar.  For example, replace lighting with CFC's and make sure your heating and cooling systems are clean and running well. If they are inefficient, replace them.  Also, you might consider replacing desk-top computers with laptops, which use up to 90% less electricity than desk-tops. 

 

A 4-day work week could cut expenses by 18-20%, too.  In other words, do all you can before putting in the solar system and you'll save a lot.  The employees will be happier, too!

post #8 of 10
Thread Starter 

I thought it sounded too good to be true!

 

I imagine it would be hooked up to the grid. 13c kW is still sounds like a good deal though!

post #9 of 10

I agree with kpennet. Solar panels (PV) are a bad investment. Why commit to a marginal technology with such a long payback period? You'll be shorting yourself. I would just wait for thin film or concentrating solar to catch up ...


Edited by petera650 - Fri, 01 Aug 2008 00:57:59 GMT
post #10 of 10

I dunno if you ended up seeing this thread or not, but I posted about an article on Extremetech that outlined the evaluation, installation, and post-mortem of buying solar. He's a very analytical guy and I think does a great job outlining the angles:

 

http://www.extremetech.com

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