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We are having solar installed on our new home. In less than five years our cost for electricity will be nearly zero

Solar power generation is awesome … especially when it enables a person’s electricity consumption to become nearly free within a handful of years. Solar is a smart investment for us personally in our new home and could be for you, too.

BUYING A SOLAR INSTALLATION WAS A NO-BRAINER FOR US
When we moved from Minnesota to California in June of 2018, we knew costs for everything would be higher. We expected that any new home we would buy would cost a lot more (our new home cost nearly double the value of the home we sold back in MN), but what we did not  expect was the high cost of electricity!

In Minnesota we had Xcel Energy whose cost for electricity around-the-clock was 11.7 cents per kilowatt hour. Our new home here in southern California happens to be located in San Diego Gas & Electric‘s (SDGE) region, and it turns out that their electricity cost is the highest in the nation!

SDGE’s pricing plans are numerous, but the year-long average per-kilowatt hour cost — which prospective solar install companies used to calculate our solar system size — was going to be roughly 32 cents per kilowatt hour, nearly 3X what energy cost us when we were living in Minnesota.

On almost all of those SDGE plans there are off-peak, super off-peak and on-peak rates (and one plan even has a cheap car-charging rate from midnight to 6am of only $.09 per kilowatt hour). The on-peak rates are in effect during the summer months — which run from June 1 – October 31 during the 4-9pm time-frame — and what stunned us was the rate during those five hours each day can cost up to $.53 cents per kilowatt hour!

Because of that unexpectedly expensive energy, a few weeks after we closed on our new home we immediately set about learning everything we could about solar, what we needed and what it would cost. We then set about finding the four “best” solar install companies and have them propose a solar panel solution. We selected the best installer for our requirements, signed-up, and everything is in motion.

Within the next several weeks our new solar panel installation will be complete on top of our new home and, based on our projected energy use for the year, our break-even on our solar investment is expected to be 4.8 years. After that our only cost for electricity will be approximately $12 per month for the SDGE “interconnect fee,” which covers the electric meter on our house and account management by them.

Energy rates continue to accelerate and I’ve read numerous articles on the projected 20 year rates that SDGE has received agreement on with the California Public Utilities Commission (CPUC). However, this article from less than a month ago said this:

If approved by CPUC commissioners, average electricity rates in SDG&E’s service territory would increase from 26.25 cents a kilowatt-hour this year to 27.4 cents next year, a rise of 4.54 percent. For a typical residential customer living in the company’s inland climate zone and using 500 kilowatt-hours a month, a bill during a summer month would increase $5.59, according to SDG&E estimates.

I’ve seen SDGE’s own projections and 4.5% per year price accelerator is expected. So as each year passes, our investment in solar energy will pay off even faster and continue to look like a very smart move on our part. But solar (or wind) alone will help combat climate change, but even if every one of the 2,500 homes in our development went solar, it wouldn’t make a serious dent in the emission of  greenhouse gases in to the atmosphere.

For our system being installed, our estimated net electricity cost savings over 25 years will be over $82,000 (assuming a 4% per year utility price escalator). That’s why it was a no-brainer for us to get solar!

Obviously our solar generation will go back in to the grid and offset all of our energy use, including at night. In fact, we’ll be adding about 30% more energy back in to the grid than we consume, just in case we end up with two electric cars at some point and need that extra amount to offset an increase in our consumption.

WHAT ABOUT ENERGY STORAGE?
We drive hybrid cars (and I’m getting a plug-in hybrid in two weeks that will cover 90% of our driving needs on electric) since both my wife and I believe in climate change and that the United States must move forward toward a clean energy future and away from carbon emitting fossil fuels. Charging my PHEV from solar will be easy and free in the near-term, but with energy demand increasing monthly in the United States and around the world, we at least considered buying battery storage to run essential systems (e.g., the refrigerator and some lights).

As such, we also looked at the addition of solar energy battery storage in our garage. Unfortunately batteries are far too expensive and not worth the investment currently (e.g., one Tesla PowerWall is $12,000 and we’d need four of them to be completely energy self-contained) so we’re holding off on storage, perhaps permanently.

As part of our analysis and reading, my wife and I also talked about large-scale battery storage, just in case renewable energy creation does reach critical mass here in California and more energy from solar goes back in to the grid. What might happen if SDGE begins to embrace battery storage for solar-produced energy?

The green energy storage problem is too expensive right now, but we’ll keep an eye on it.

TRUMP & THE GOP DENIGRATING RENEWABLES
It pisses me off that the Trump administration continues to try to gut clean energy spending with his proposed budget that does exactly that. It is clear that this current administration, and Republicans who support Trump’s position on clean energy, continue to position climate change as a “hoax” and the oil & gas industry as “the future” of energy.

Remember when one of the key talking points for the GOP (for decades) was toward less dependence on foreign oil? That wasn’t positioning for renewables, that was positioning for more drilling (and now for fracking shale to squeeze out oil and get natural gas).

Do either Trump or the GOP think that all of their own base of supporters and constituents are too stupid to think for themselves? Such idiots that they don’t believe in science? Though I don’t think President Trump is even capable of thinking deeply about any issue, Republicans should at least realize that even corporations are calling for action on climate change and they’d better stop being dumbf*cks, sucking-up to the oil & gas industry.

Also, I’m glad I’m not alone in my outrage and found this hilarious:

2 Comments

  1. John on May 16, 2019 at 5:42 pm

    My family (in Australia) is considering the same investment. How long do you think before battery storage becomes cheap enough to be worth buying, for the average household?



  2. Steve Borsch on May 16, 2019 at 7:32 pm

    Several knowledgeable people I’ve spoken with have put the time horizon for home energy storage at 5 years. If you want to get more in-depth, I’d suggest taking a look at this free report, “Jump-Start: How Activists and Foundations Can Champion Battery Storage to Recharge the Clean Energy Transition (PDF).”



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About Steve Borsch

Strategist. Learner. Idea Guy. Salesman. Connector of Dots. Friend. Husband & Dad. CEO. Janitor. More here.

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