In the spirit of being as objective as I can, I was reading over a previous post on the long term cost of solar, and realized I didn't make the clear distinction between PV production measured in DC(direct current) vs. AC(alternating current).
The example in that previous post was a hypothetical family whose electricity needs require a system that that produces 2 kW in power. After the calculations including rebates and tax credits, I came to the conclusion that the 2 kW system would cost $10,900. So far, so good.
Now, the problem: The family's need (according to the hypothetical that was swimming around in my head) is a system that gives them 2 kW of household electricity generation, which is AC. The $10,900 cost above was based on a 2kW PV system, but measured in DC(direct current). But, of course, those 2kW DC will not produce 2kW of household AC. When those little electrons travel from your rooftop panels, through the inverter, and to the outlets in your house, a substantial part of the DC energy is lost.
So, how much energy is lost in this process?? It's different for every PV system and depends on sun/weather conditions of each locations, but I'll use a higher (pessimistic) figure I've seen, which is a loss of 35% when converting DC to AC, combined with other factors such as sun irradiance level, voltage loss in the wiring, dirt on the panels, etc. In other words, if your solar panels are rated for DC at 1000 watts(1kw), they'll produce as few as 650 watts. And so, the 2kW DC system our hypothetical family installed, could produce as little as 1300 watts or 1.3 kW AC, not the 2kW household AC they would need.
How big a system would they need to generate those 2kW AC, then??? In order to get AC generation of 2000 watts(2kW), we have to find how big a DC system would produce 2000 watts AFTER you account for the electricity loss of 35%,
or (X watts)x(65%) = 2000 watts, or 2000/.65 = 3077 watts or roughly 3 kW.
The family needs a 3kW system(DC), not the 2kW $10,900 system in the original example. So, the new price tag will be: $16,600. This assumes installed cost of $9.00/watt, minus CA rebate of $2.80 per watt and minus the new fed tax credit of $2,000.
Finally, to recalculate how much this system costs over 20 years/kWh produced AC, we do $16,600/73000 kWh = .227/kWh. Remember we pay PG&E about .15/kWh to get the good ole fossil-fuel based electricity.
Conclusions . . . the example above uses a low-ball, almost worst-case figure of how much the 3kW system might produce, so the family might well be able to buy a less-expensive 2.5 kW system for $13,500 to get the production they need. Secondly, solar power has gotten less expensive, but it is still about 50% more expensive than coal/gas traditional electricity retail.
But doesn't this make logical, market sense, like the comparison I made in a previous post about why we would pay more for a Prius than a Pinto? If you were in the business of selling electricity, wouldn't the electrons from the renewable, green energy of the sun command a higher price than the electrons produced from carbon/mercury-laden coal? It comes down to the individual decision if one can afford it and if its worth it to spend ballpark $15,000 up-front, or even a monthly 5-year loan payment of about $200, to be a green, solar energy producer.
Categories: solar, energy, green, sustainable, EconomicsOfSolar