Going Solar in Howard County: Expanded our System

Here's an update on our experience with solar electric panels in our home.

Last month we expanded our solar photovoltaic system from 1kW to 2kW, or from 6 panels to 12. We made the decision for two main reasons: we've been very happy with the initial installation and the cost savings we've seen, and with the new year we became eligible for a new round of federal, state and county tax credits and incentives.

In earlier postings I've talked about our initial experience with solar power, the financial incentives and battery backup. As reported earlier, we had initially seen savings in electricity usage of nearly 35%. I have to admit that as the winter days grew shorter and our evening energy usage rose, our monthly energy savings declined to as little as 10-15% of our former usage. Today I received my BGE bill for January, and it was actually higher than before we installed solar, but it was also the coldest month in several years, and we had a glitch in our solar power generation that I'll explain below. The bottom line is, after nearly a full year with a small solar electric system, I can say that our overall electricity usage has been reduced nearly 25%. Conservation, not actual solar power generation, accounts for the greatest portion of savings, but if we had not put in the solar panels I know we would not have been as energy conscious.

As for the financial incentives, it should work out that the entire cost of the nearly $8,000 expansion will be covered with tax credits and grants. As of January 1, the federal tax credit now covers 30% of the system without any limit, Howard County offers a property tax credit of 50% of the system up to $5,000, and we acted quickly to stay eligible for the state of Maryland grant of $2,500 per kilowatt of solar power generation installed. That makes any further energy savings or income from Renewable Energy Credits gravy for us. It's hard to argue with the economics of a small solar power system, especially in Howard County.

Our system provider, Standard Solar, did a fine job upgrading the system over two chilly days last month (I'm glad I wasn't the one scrambling around on the roof). For several weeks during the rest of that cold January we had a hiccup in that the system was not feeding excess power back to the electric grid, so we weren't getting the full benefit of the expanded system. I didn't notice it until last week and we got the issue sorted out quickly over the phone. Now, with the 2kW system generating power on a sunny day, I can actually see my meter running backwards, selling electricity back to the grid and cutting my BGE bill. It's a great feeling.

In sum, our experience with solar energy continues to be excellent, and I certainly encourage you to consider it for your own home and circumstances. The financial benefits remain attractive, and the environmental and psychic rewards are hard to beat, too.

Maryland Solar Energy Grant Deadline 11/30/08

The Maryland Solar Energy Grant program has issued a deadline of November 30, 2008 to get on the list of projects eligible for the current level of grants. The current program offers $2,500 per kilowatt of solar energy installed, up to a cap of $10,000.

Because the program has proven very popular and the Federal tax credit will no longer have a ceiling beginning January 1, 2009 (as part of October's $700B financial bailout package), the Maryland program will be revised and will probably not be as generous in the future.

So, if you want to take full advantage of both the Maryland and Federal programs, you need to get a solar project under contract with a down payment by November 30...and probably the sooner the better to get higher on the waiting list for funds. The project must be installed between January 1 and June 30, 2009, as I understand it.

It's not clear to me whether the state of Maryland guarantees that all eligible grants will be fully funded, but it appears that is the intent. The funding money comes from Regional Greenhouse Gas Initiative auctions, the first of which in September generated $13 million. Two more auctions are scheduled in December and March.

If you don't make the November 30 deadline, you can still be eligible for the Maryland program for next year, but the levels of grants are yet to be determined.

See my earlier posting on solar incentives and tax credits.

Going Solar in Howard County: Battery Backup

If you've ever thought of using solar power, Howard County offers one of the best deals in the U.S., and tax breaks make early 2009 a great time to do it. I'm going to do several posts about it.

One of the coolest unexpected features of solar power for our home is the battery backup option. I didn't know anything about it when I got started, but for us it's proven to be one of the most gratifying aspects of the whole system.

Our home in western Howard County is on well and septic, which means if the power goes out, it can get real inconvenient real fast. Thunderstorms, wind and construction all seem to have an effect on our power supply from BGE. Actual outages have been fairly rare, thank goodness, but we get fluctuations and spikes that can get mighty annoying.

When we built our home, I considered putting in a gas generator, but was never comfortable with the cost or maintenance. I did get the home wired for a portable generator, though, which meant running selected circuits to a separate panel in the basement. I just never got the generator and fortunately the power has not gone out for more than a few hours at a time.

Under normal circumstances, all you need for a solar installation are the panels on the roof and an inverter that changes the solar direct current into alternating current for your home. The AC power feeds directly into your existing home circuitry. If it happens that you generate more electricity from your panels than you are using at any moment in your home, the excess power feeds back into the neighborhood electrical grid and your electric meter actually spins backward (a very cool thing to see).

As an option, you can add a battery backup system that can store several kilowatts of power to drive critical circuits in your home. We got a small one that stores 5 Kw and cost around $6K. The battery backup option does not qualify for the solar tax credits or incentives, but it has proven to be a very worthwhile investment for us.

The great thing is the battery is totally silent, maintenance free, and kicks on within milliseconds. Now, when we have power spikes and hits, the circuits that are on battery backup operate without a hitch. My wife can be watching TV in the bedroom and not even know that something happened. Likewise, our water pump, refrigerator and freezer operate without interruption.

We haven't had an outage of more than a few hours, well within the capacity of the battery. But if we did, the system would be able to recharge at least partially whenever the sun comes out, and continue doing so indefinitely. I'm hoping never to have to go and get that portable generator, or the gasoline and noise that go with it.

See the other posts in this series:
Going Solar in Howard County - My Experience
Going Solar in Howard County - Taxes and Incentives

Going Solar in Howard County: Taxes and Incentives

If you've ever thought of using solar power, Howard County offers one of the best deals in the U.S., and tax breaks make early 2009 a great time to do it. I'm doing several posts about it.

This post is about the important tax breaks and credits available that make solar power so attractive right now. As a disclaimer, I am no expert and you should check with your vendor and tax adviser for more reliable information. But the information below is correct to the best of my knowledge, and reflects my experience so far.

There are four major incentives currently in place to encourage residential solar power in Howard County: federal, state and county incentives and Renewable Energy Credits. I'll deal with each in turn, and also look at two other factors in the payback equation: power usage offset and conservation.

• Federal Tax Credits. You can deduct 30% of the installation cost of a solar electric system from your Federal tax return. There is currently a cap of $2,000 on this incentive, but one of the sweeteners used to pass the $700B "bailout package" was extending the credit and removing the cap beginning in 2009. Since my system was installed in 2008, I'll be taking $2,000 off my 2008 federal returns.
  
  
• Maryland Solar Energy Grant. Maryland will pay you up to $2,500 per kilowatt of solar energy installed, up to a cap of $10,000. That cap was recently raised from $3,000 when my system was installed just 6 months ago. Nevertheless, I've already received a check from the state for $3,000.
  
  
• Howard County Property Tax Credit. Howard County will deduct 50% of the cost of a solar electric system from your property tax, up to a $5,000 cap. Since my system was installed in May 2008, I've received a letter from the County assuring me that $5,000 will be deducted from my 2009 property tax.
  
  
• Renewable Energy Credits. RECs are a little hard to explain because the system is convoluted and still evolving. The basic idea is that the power companies will pay homeowners in Maryland and some other states for solar energy production. But they will do so through "aggregators" that bundle 15-year credits from multiple homeowners. In my case, the state has certified that my system will produce 18 RECs; my vendor estimates each REC is worth $186 so my RECs should be worth $3,348. That transaction is still in progress, though, and I don't have my hands on the money yet...but there does seem to be progress.
  
  
• Power Usage Offset. The fact that you generate electricity from your solar panels means you buy less from BGE or whomever. My small system offsets less than 10% of our average usage, but that represents money I keep in my pocket rather than paying BGE. And as BGE rates go up, that represents more savings.
  
  
• Conservation. Since we installed our sytem we are much more conscious of our energy consumption. You can argue that we should have been more conscious before, but the fact is you do pay more attention when you have panels on your roof and a meter in the basement. And the real-world result is that our electricity usage is down 35% since we installed our system. Your results may vary, but I bet you'll be surprised. I know there are steps we could take to be more efficient, like changing our more light bulbs or getting a programmable thermostat, so perhaps we'll get even better in time.
  

The Bottom Line: This combination of credits more than paid for my entire small system, except for the optional battery backup. Now that the caps have been lifted for the federal and state incentives, you could justify an even larger system in 2009, probably 2Kw or so. Check with a solar vendor! The current package of incentives means they are giving these systems away!!


Check out these websites for more information:
Standard Solar - Available Incentives
Chesapeake Solar - Financial Incentives
Howard County Incentives

See the other posts in this series:
Going Solar in Howard County: My Experience
Going Solar in Howard County: Battery Backup

Going Solar in Howard County: My Experience

If you've ever thought of using solar power, Howard County offers one of the best deals in the U.S., and tax breaks make early 2009 a great time to do it. I'm doing several posts about it. First, let me tell you about my experience.

About a year ago I started checking into the possibilities of solar power for our home. I had heard about various tax breaks and incentives, but didn't know what they would mean for me. I started reading various web sites and contacted two of the most active solar installers in the area, Standard Solar (Gaithersburg, MD) and Chesapeake Solar (Jessup, MD). Both of them seemed very good, and I got site visits and quotes from both. Though their prices and offerings were similar, the Standard Solar representatives were a little more responsive, so I ended up working with them.

Both vendors started by recommending fairly large 3-5 kilowatt systems that ranged from $35-50K. As each of them started explaining the tax breaks and incentives, the prices came down almost in half, but the payback was still many years on the investment. The federal and state incentives were capped, at that point, at $2,000 and $3,000, respectively. I began to wonder if a smaller system that made more efficient use of the caps would come closer to paying for itself immediately.

Sure enough, I found that by installing a 1-2 kilowatt system with an initial outlay of around $15K I would recoup the cost of virtually the entire system through the various tax incentives. Those incentives are a little complicated and I'll go through them in a separate post. And they've become even more generous for 2009 which is why you really should start investigating solar yourself.

We ended up installing a small system in May 2008. The system was rated to offset less than 10% of our average monthly usage, but it was a start and, except for a battery backup option I added, it paid for itself in tax incentives.

Now -- here's the kicker. Since we installed the system, our whole family has become much more aware of our energy usage. We are much more proactive about turning off lights, keeping thermostats under control, and we've switched a few (but not nearly all) lights to flourescent bulbs. The result: our energy usage has declined by 35% since we installed the solar system. We've dropped from averaging over 1,800 KwH per month to less than 1,200 KwH.

So check out solar power in Howard County. It's something that's good for the country and good for you!

See the other posts in this series:
Going Solar in Howard County: Taxes and Incentives
Going Solar in Howard County: Battery Backup