FAQ — Favorite Answers to Questions

Electricity consumption is measured in kilowatt-hours (kWH) and is the a product of electrical consumption over time (1kWH = 1000W used for 1 hour).  Your electrical power consumption is reflected on the utility bill you receive each month. There is typically an area on the bill that states average kWH’s used over a given period (usually 30 days).  This number is important when sizing and designing a solar electric system to meet a percentage of your home or business needs. Your electric utility can also provide this information over the phone. It is very helpful to pull together the last 12 months of electric usage before your initial conversation with Sunsense.

Every Sunsense solar electric system is custom-designed to fit your needs. The size of the system depends on your off-set goals, electricity usage, the available amount of appropriately oriented roof space (or “sunny property”) and solar panel efficiency. Sunsense can schedule a free site visit to evaluate your goals, budget, and appropriate location of your system.

Solar panels are relatively lightweight so there are rarely any structural modifications required, however, the age of the roof and the roof condition are important variables in siting the solar electric array. A mounting structure is specified in order to secure solar panels to the roof, so pre-installing mounting posts or structural “feet” may be required.  Metal conduit and wire must be installed from the solar panels to the electrical panel.  Sunsense systems are designed to minimize these visual impacts while maintaining performance.  The final step is a simple feed to an appropriately sized circuit breaker in the main service panel.

A solar electric system compares very favorably with other home improvements in terms of cost recovered.  A solar electric system is considered an asset that holds its value.  Well designed and installed solar electric systems add “green points” to a home or business. This may be required in many areas, particularly for new construction. 

No. There is legislation that prevents your property taxes from increasing even though the value of your property increases.

Many homeowners finance their systems with funds from a home mortgage or home equity line of credit. Loan payments are frequently similar to or less than what a homeowner would pay the utility for power. Plus, the homeowner now owns a solar electric system that adds value to their property and protects them from future utility rate increases. Sunsense can provide connections to numerous financing mechanisms.  Contact us for more information.

You are already essentially financing an indefinite, variable rate loan from your utility company. Installing a solar electric system allows you to refinance this loan at a fixed rate and term, pay less every month, and have your loan payments go towards ownership of a valuable asset. Solar electric systems usually yield an initial return on investment of 7-11%. As utility rates increase your return will also increase.

Property secured loans usually offer the best terms and lowest interest rates. If you are in the process of refinancing a commercial property, you should consider the purchase of a solar electric system. Payments on a secured loan are often less than, or similar to, the amount that your business will save in utility bills.

Capital equipment loans are probably the most common method for financing solar electric systems. There are many banks and institutions that grant capital equipment loans. The loan terms will depend heavily on your lender and credit rating.

Some organizations (particularly non-profits) choose to go solar through a financing mechanism known as a Power Purchase Agreement or PPA. PPAs are long-term agreements to buy power from a solar investor or development company that finances and owns the solar system and then sells the end-user the electricity generated by the system, usually at or below market rates. After the system has been depreciated, this third-party solar developer can sell the system to the organization at fair market value. In many situations both parties can see very good return on investment.  Sunsense has been working with numerous financial partners on crafting PPA’s from 50kW to 2MW.

Renewable Energy Credits (RECs) are tradeable environmental commodities in the United States which represent proof that 1 megawatt-hour (MWh) of electricity was generated from an eligible renewable energy resource.  REC value varies from time to time and from jurisdiction to jurisdiction.

Rebates area key component in the affordability of solar electric systems.  With a relatively high up front cost, rebates and other incentives make these systems far more affordable.  Rebates can come from a number of sources.  Many utilities around the country offer rebates for solar electric installations on both homes and businesses.  Certain municipalities offer rebates for installations. Environmental and other “green” organizations often reward solar electric system installations as well.

Below are rebate details as of January 1, 2009, but contact Sunsense for other areas and current rebate status:

In Colorado, rebates depend on who provides your electricity.  Xcel Energy, the largest utility in the state, offers a rebate of $2.00 per watt.  As a condition of this rebate, they will also buy your Renewable Energy Credits (or RECs) for $1.50 per watt.  This adds up to a total of $3.50 per watt!  Solar electric systems up to 10kW are eligible for these rebates.  Larger systems are eligible as well, however, the guidelines are slightly different.

In Western Colorado (and the Roaring Fork Valley, in particular), if Holy Cross Energy is your utility, you are eligible for a $2.00 per watt rebate.  There is no requirement to sell the RECs and therefore, you retain possession.  As the renewable energy market grows, these RECs should retain value and may be sold in the future.  Further incentive is offered through CORE, the Community Office for Resource Efficiency, offers an additional $2.00 per watt to many customers.  There is a cap of 3kW (or $6000) on this rebate. 

The Federal Investment Tax Credit (ITC) allows a 30% credit against an individual’s tax liability for the installed cost of a solar electric system after all other rebates.  There is no cap on this tax credit. Businesses can take advantage of a 2-5 year accelerated depreciation of their solar solution and use the 30% Federal Investment Tax Credit, in whole or in part, in any year they choose. The result for businesses is the potential to reduce their net cost by 80% of the initial price.  Tax law can be complicated and can change with short notice. Sunsense highly recommends consulting with your tax accountant prior to the purchase of a solar electric system. 

The life of a solar system is 30+ years. Systems will usually have a payback period of between 6-15 years. Any power produced after that is money in the bank.  Your exact payback period will depend on the system production, your electrical usage, electric rate schedule, and initial cost of your system.  In most cases the larger your electric bill the greater the return on investment and the faster the payback.

For solar electric systems installed on a home or business that is connected to the grid (grid-tied), net metering allows you to have only one bi-directional electric meter (it can spin forwards or backwards).  When the sun is shining, your solar system is producing electricity that can be directly used by your home or business, thereby offsetting the amount of electricity being purchased from the utility company.  If the electricity is not immediately used it is sold back to the utility company, causing your electric meter to slowdown, stop and then spin backwards to give you a credit. Your electric meter may spin backwards and forwards on a daily basis, but you’ll only be billed according to the “net” reading on your meter at the end of each month. In this way, net metering allows you to take advantage of, and get retail credit, for every unit of electricity that your solar electric system produces. If you produce more power than you use each month, the credits will carry over for later use for up to 12 months. Net production at the end of the year may result in a payment from the utility!

A grid-tied solar electric system requires solar modules and one or more inverters. The inverter converts the DC electricity from the solar modules to alternating current, or AC. Most electrical devices in homes and businesses run on AC electricity. Additional components include a mounting structure, disconnects (where required), all associated conduit and wiring, and any monitoring equipment.  Ground mounts or pole mounts will require infrastructure such as concrete, steel poles and other structural materials.

Your solar electric system will not produce electricity without direct or diffused sunlight. On cloudy days and at nighttime, you will draw electricity from the grid. Any credits accumulated on sunny days will be used on cloudy days and at night.

The array, which is comprised of individual solar modules, can be mounted on your roof, on the ground, or on top of a pole. Other custom mounting and location strategies exist such as awnings, parking structures or even vertical walls.  Solar electric systems perform best when exposed to full sun from at least 9AM to 3PM without any shading. While this time frame is a minimum, the longer the modules remain shade free, the more energy they will produce.

The electricity produced by your solar system functions in the exact same way as the electricity from the grid. Your solar electricity will provide power for all of your uses.

Batteries are only necessary if you are living off-the-grid or desire back-up storage. Most solar electric systems in areas with a utility grid connection forgo batteries and effectively use the utility grid as a battery. Not having batteries in a system will reduce the overall cost and virtually eliminates maintenance.  Generators are a nice back-up power supply as well, but are not necessary when installing a solar electric system.

Most homes use natural gas or LPG (propane) for heating. Some are all electric. Though not very efficient, solar electric systems will supply electricity to power electric resistance heaters directly or the electricity can power pumps, fans and blowers for forced air units and ground source heat pumps.

Solar thermal systems utilize the sun’s energy for heat.  What solar electricity is to electrical work, solar thermal is to plumbing and air handling.  Whether heating air, water or some type of heat transfer medium, solar thermal systems are extremely cost effective.  Solar thermal systems are particularly useful for domestic hot water, pools and spas.  Sunsense partners with solar thermal contractors to offer solar thermal systems as a compliment to the solar electric systems.