In light of my recent threads on CitizenRe I built a spreadsheet to do solar energy economic calculations. If you click on that, you can download the spreadsheet to try for yourself. If you don’t have a spreadsheet program (I recommend the free Gnumeric or Open Office) it’s also up as a Google Solar Spreadsheet but you may need a Google account to plug in your own numbers.
The sheet shows the key numbers you will play with in blue. Rebates and incentives vary a lot state to state. The federal tax credit is hugely different if a corporation puts up the panels instead of an individual homeowner. The sheet lets you enter your price for grid power but doesn’t yet include a way to code it so that this price rises or falls with time.
The sheet will tell you a couple of interesting numbers. One is, based on a solar cost, what that works out to as a price per kwh. You can see from that how much more or less solar costs than grid. Alternately, for setups where the solar does cost less than grid, it calculates how many years it takes for the solar installation to “pay for itself.” Of course, at today’s prices, the systems never pay for themselves compared to grid, but this lets you play with the numbers and find out where it will.
I’ve set things for some California rules, including 12.8 cents/kwh and a $2.50 per watt rebate. Rebate rules vary greatly from state to state, you can find them at this web site.
Some things you can learn
- It doesn’t really matter if you try to amortize the panels over 30 years or 50. Beyond about 25, it works out to the same. I have a box where you can guess a value for the panels at the end of the period, but it doesn’t change things a lot.
- Compared to 12.8 cent grid power, you need an after rebate fully installed cost of about $2.75/watt to match, which can come with $2.70 for panels and $3/watt, for a residence.
- Compared to the national 8 cent price you need an installed price of about $1.90. Or $1.70 in a state with less insolation.
Let us know what other things you learn, or if you want to improve the sheet with variable grid cost and adding other credits and costs (I list what’s not factored) let me know.
Update: A commenter pointed us at this calculator which factors in tax consequences. They make a much bigger difference than I expected. For homeowners, they factor in the fact that interest from a home equity loan is tax deductible, even though power from the power company is not. For corporations, the quick write-off of the panels also makes a bigger difference than my intuition suggested. Alas, this page does not appear to work in firefox on linux.