Solar Energy Costs For Mc Gehee Kelsey

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Kelsey explored the costs of solar energy.

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  • Slde 1: what is solar energy Slide 2: pv Slide 3: thermal Slide 4: who benefits from solar energy Slde 5: solar pv installation costs Slide 6: solar thermal installation costs Slide 7: business energy investment tax credit Slide 8: property tax Slide 9: calculating costs Slide 10: calculating payback time Slide 11: mcgehee energy costs Slide 12: testing the numbers for solar energy
  • Solar Energy Costs For Mc Gehee Kelsey

    1. 1. THE COST OF GOING SOLAR FINANCING SOLAR PANELS AND SOLAR THERMAL TECHNOLOGIES By Kelsey Zeitzer
    2. 2. What’s Solar Energy <ul><li>Solar energy creates useable power form sunshine </li></ul><ul><li>Photovoltaic or PV uses sunlight to generate electricity </li></ul><ul><li>Thermal solar uses sunlight to heat water </li></ul>
    3. 3. - Sunlight absorbed & energy generated <ul><li>PV cell: convert solar energy into electrical power </li></ul><ul><li>Takes energy - convert PV </li></ul><ul><ul><li>(DC) into energy that can be used at home (AC) </li></ul></ul><ul><li>- less efficient </li></ul><ul><ul><li>sunlight to electricity conversion rate at 12% </li></ul></ul><ul><li>Require a lot of space & collectors </li></ul><ul><li>5Xs + costly than thermal </li></ul><ul><li>Usable year round </li></ul><ul><li>heating water & storing it </li></ul><ul><li>number of different solar thermal designs </li></ul><ul><li>More efficient </li></ul><ul><ul><li>use up to 70% of the suns energy </li></ul></ul><ul><li>requires less space & fewer collectors </li></ul><ul><li>difficult to add passive solar collectors to existing buildings </li></ul><ul><ul><li>you will have to use an active system which means larger storage tank </li></ul></ul><ul><li>5Xs cheaper than PV </li></ul><ul><li>Wont work all year round </li></ul>Solar Cells Or Photovoltaic (PV) Solar Thermal Energy
    4. 4. Who Solar Energy benefits <ul><li>The Environment! </li></ul><ul><li>Solar energy reduces amount of fossil fuel being burned </li></ul><ul><li>reducing the pollutants & CO2 polluting the atmosphere </li></ul><ul><li>You! </li></ul><ul><li>- Reduces your energy bill </li></ul><ul><li>Federal, State & utility financial incentives </li></ul><ul><li>Adds value to property </li></ul><ul><li>Gain energy independence </li></ul><ul><li>Good investment in a sustainable future for yourself & your loved ones </li></ul><ul><li>The Community! </li></ul><ul><li>safer: improves national security </li></ul><ul><li>Protects future generations </li></ul><ul><li>Helps the economy! </li></ul>
    5. 5. Solar PV installation costs <ul><li>Commercial based solar electric systems </li></ul><ul><ul><li>Typically cost: $25,000 to $350,000 installed </li></ul></ul><ul><ul><li>Multiple variables influence the cost of these systems: </li></ul></ul><ul><ul><ul><li>Amount of utility grid power to be offset </li></ul></ul></ul><ul><ul><ul><li>Selected type of system </li></ul></ul></ul><ul><ul><ul><li>Mounting options </li></ul></ul></ul><ul><ul><li>Third party financing available </li></ul></ul>
    6. 6. Solar thermal installation costs <ul><li>Commercial water heating systems </li></ul><ul><ul><li>Typically cost: $15,000 to $250,000 installed </li></ul></ul><ul><ul><li>Multiple variables influence cost of these systems: </li></ul></ul><ul><ul><ul><li>Amount of water to be heated </li></ul></ul></ul><ul><ul><ul><li>Desired water temperature </li></ul></ul></ul><ul><ul><ul><li>Selected system collectors </li></ul></ul></ul><ul><ul><ul><li>Desired function(s) of the system </li></ul></ul></ul><ul><ul><li>Typical payback period for solar hot water heating systems is 6-8 years </li></ul></ul><ul><ul><li>Third party financing is available </li></ul></ul>
    7. 7. Federal Tax Credit: Business Energy Investment Tax Credit (ITC) <ul><li>Corporate tax credit </li></ul><ul><li>2005: Energy Policy Act </li></ul><ul><ul><li>S.48: Energy Business Energy Tax Credit </li></ul></ul><ul><li>Oct. 3, 2008: Economic Stabilization Act of 2008 </li></ul><ul><ul><li>179D: Energy Efficient Commercial Buildings Tax deduction </li></ul></ul><ul><li>Allow AMT (alternative minimum tax) filers to take credit </li></ul><ul><li>30% tax credit of expenditures </li></ul><ul><li>Extended for 8 yrs --> until Dec. 31 2016 </li></ul><ul><li>NO maximum credit </li></ul><ul><li>Eligibility: </li></ul><ul><ul><li>Technologies: Solar water heat, photovolatics ect. </li></ul></ul><ul><ul><li>Equipment used to:Generate electricity,heat/cool structures,provide solar process heat </li></ul></ul>
    8. 8. LA Credit:Business Energy Investment Tax Credit (ITC) <ul><li>Corporate tax credit </li></ul><ul><li>Allow AMT alternative minimum tax filers to take credit </li></ul><ul><li>30% of tax credit of expenditures </li></ul><ul><li>Max: fuel cells $1,500 per .05kW </li></ul><ul><li>Eligibility: </li></ul><ul><ul><li>Technologies: solar water heat, photovolatics etc. </li></ul></ul><ul><ul><li>Equipment used to: generate electricity, heat/cool structures, provide process heat </li></ul></ul>
    9. 9. Energy Efficient Commercial Buildings Tax Deduction <ul><li>Corporate deduction </li></ul><ul><li>Commercial, construction, state gov, fed gov </li></ul><ul><li>Energy Policy Act 2005 </li></ul><ul><ul><li>Tax deduction for energy efficient commercial buildings </li></ul></ul><ul><li>Extended through 2013 </li></ul><ul><li>Eligibility </li></ul><ul><ul><li>Technologies: water heaters, lighting, lighting controls / sensors, chillers, furnaces, boilers, heat pumps, air conditioners, etc. </li></ul></ul><ul><li>Ranging from $0.30-$1.80 pr sq-ft depending on technology & amount of energy reduction </li></ul>
    10. 10. MACRS + Bonus Depreciation <ul><li>Corporate deduction </li></ul><ul><li>Modified Accelerated Cost Recovery System (MACRS) </li></ul><ul><ul><li>Business recover investments in certain property via depreciation deductions </li></ul></ul><ul><ul><li>Property includes: </li></ul></ul><ul><ul><ul><li>Solar electric & solar thermal technologies etc. </li></ul></ul></ul><ul><li>Federal Economic Stimulus Act 2008 </li></ul><ul><ul><li>50% bonus depreciation provisions for renewable energy systems </li></ul></ul><ul><li>American Recovery & Reinvestment Act 2009 </li></ul><ul><ul><li>Provision from 2008 extended to 2009 </li></ul></ul><ul><ul><li>Requirements: </li></ul></ul><ul><ul><ul><li>Recovery of 20 years (or less) under normal fed. Tax depreciation rules </li></ul></ul></ul><ul><ul><ul><li>Taxpayer must claim deduction </li></ul></ul></ul><ul><ul><ul><li>Solar technologies acquired 2008 or 2009 </li></ul></ul></ul><ul><ul><ul><li>Solar technologies working by 2010 </li></ul></ul></ul>
    11. 11. Property Tax <ul><li>Solar Systems are an asset that add value to your property </li></ul><ul><li>The value of solar energy systems are not subject to property tax in Louisiana </li></ul>
    12. 12. Calculating the payback time <ul><li>Years to Breakeven </li></ul><ul><ul><li>net cost - property value increases </li></ul></ul><ul><ul><li>“ pre-tax” average annual utility savings </li></ul></ul><ul><ul><li>= years to break even </li></ul></ul><ul><li>Break Even point: </li></ul><ul><ul><li>Costs / expenses = revenue </li></ul></ul><ul><ul><li>NET = ZERO (no net loss or gain) </li></ul></ul><ul><ul><li>EX) you spend $40 you make $40 </li></ul></ul>
    13. 13. Years to Break Even <ul><ul><li>EX) Solar Panels </li></ul></ul><ul><ul><ul><li>Entergy bill: 1,000 a month </li></ul></ul></ul><ul><ul><ul><li>Solar Panels cost: 10,000 </li></ul></ul></ul><ul><ul><ul><li>Save money over time </li></ul></ul></ul><ul><ul><ul><li>So the years to break even is how many years it would take to get a net zero (recoup costs) </li></ul></ul></ul><ul><ul><li>Hybrid Cars </li></ul></ul><ul><ul><ul><li>Cost extra but your not paying as much for gas </li></ul></ul></ul><ul><ul><ul><li>So if gas is cheep than the years break even will be longer but if gas is expensive then the years to break even will be short </li></ul></ul></ul>
    14. 14. Years to Break Even (cont) “ pre-tax” average annual utility savings: how much your not spending on Entergy Net cost - Property value increases Saving $2 $10 - $5 = 5 Property value increases by $5 Property value increases: property value increases with solar panels Net cost: what its worth to put on solar panels = Years to break even (Net cost - property value increases) (“Pre-tax” average annual utility savings) What it means (Net cost - property value increases) (“Pre-tax” average annual utility savings) $10 - $5 $2 = Years to break even = 2.5 years Example $10 for solar panels
    15. 15. McGehee Energy Costs Date Building Account # KW pr Month Price 8/18/08 2343 Prytania 1286158 66600 $7,817.41 9/11/08 2343 Prytania 1286158 49800 $7,119.57 10/16/08 2343 Prytania 1286158 80000 $11,693.63 11/11/08 2343 Prytania 1286158 60000 $7,690.39 12/11/08 2343 Prytania 1286158 49000 $7,547.29 1/12/09 2342 Prytania 1286158 73600 $8,686.29 2/13/09 2343 Prytania 1286158 62800 $7,501.12
    16. 16. Average Monthly Bill Cost $8293.67
    17. 17. Average Kilowatts per month 63,114.29 kW/Month
    18. 18. Electric Rate $.1314kWh
    19. 22. Assumptions
    20. 23. Solar Electric Numbers
    21. 24. What to examine <ul><li>Estimated system size </li></ul><ul><li>Estimated system cost </li></ul><ul><li>Financial incentives </li></ul><ul><li>Savings and benefits </li></ul>
    22. 25. Estimated System Size
    23. 26. Estimated System Cost
    24. 27. Financial Incentives
    25. 28. Savings and Benefits
    26. 30. Summary <ul><li>Renewable Technologies in the future </li></ul><ul><ul><li>Help the economy </li></ul></ul><ul><ul><ul><li>More domestic jobs that cannot be outsourced </li></ul></ul></ul><ul><ul><ul><li>Less money spent on foreign oil and natural gas </li></ul></ul></ul><ul><ul><li>Help the planet </li></ul></ul><ul><ul><ul><li>Our planet needs responsible inhabitants </li></ul></ul></ul><ul><li>Energy costs are going to keep going up </li></ul><ul><li>Energy self sufficiency is key for financial freedom </li></ul><ul><li>Investing in solar technologies will help you gain financial freedom </li></ul>
    27. 31. Works Cited <ul><li>“ Business Energy Investment Tax Credit (ITC). ” DSIRE: LA Federal Incentives for Renewables and Efficiency. February 18 2009. April 23 2009. < http://www.dsireusa.org/library/includes/incentive2.cfm?Incentive_Code=US02F&State=federal&currentpageid=1&ee=1&re=1 >. </li></ul><ul><li>“ Commercial Solar Electric Power (PV). &quot; APS: Alternative Power Solutions. 2008. April 26 2009. < http://www.apowersolutions.com/index.php?p=1_5_Solar-Electric-Power-PV- >. </li></ul><ul><li>“ Commercial Solar Water Heating. ” APS: Alternative Power Solutions. 2008. April 26 2009. < http://www.apowersolutions.com/index.php?p=1_6_Solar-Water-Heating >. </li></ul><ul><li>Dan. “ Solar Thermal vs. Solar PV. ” CalFinder: residential Solar Power Contractors. July 30 2008. April 26 2009. <http://solar.calfinder.com/blog/going/solar-thermal-vs-solar-pv/>. </li></ul>
    28. 32. <ul><li>Dan. “ The Lowdown on Solar Thermal Savings. ” CalFinder: residential Solar Power Contractors. May 28 2008. April 26 2009. < http://solar.calfinder.com/blog/solar-information/the-lowdown-on-solar-thermal-savings/ >. </li></ul><ul><li>“ Energy Efficient Commercial Buildings Tax Deduction. ” DSIRE: LA Federal Incentives for Renewables and Efficiency. October 7 2008. April 23 2009. < http://www.dsireusa.org/library/includes/incentive2.cfm?Incentive_Code=US40F&State=federal&currentpageid=1&ee=1&re=1 >. </li></ul><ul><li>“ Financing Solar & Energy Efficiency Projects. ” Solar Estimate: Local Solar Pros to Help You put Solar Energy to Work. 2000-2009. April 23 2009. <http://www.solar-estimate.org/index.php?page=rightforme&subpage=finance>. </li></ul><ul><li>“ How do you calculate the payback time? ” Solar Estimate: Local Solar Pros to Help You put Solar Energy to Work. 2000-2009. April 23 2009. <http://www.solar-estimate.org/showfaq.php?id=9&fromsearch=1>. </li></ul><ul><li>Modified Accelerated Cost-Recovery System (MACRS) + Bonus Depreciation (2008-2009). ” DSIRE: LA Federal Incentives for Renewables and Efficiency. February 19 2009. April 23 2009. < http://www.dsireusa.org/library/includes/incentive2.cfm?Incentive_Code=US06F&State=federal&currentpageid=1&ee=1&re=1 >. </li></ul><ul><li>23 2009. < http://www.conergy.us/desktopdefault.aspx/tabid-2343/ >. </li></ul>
    29. 33. <ul><li>“ My Solar Estimator. ” Solar Estimate: Local Solar Pros to Help You put Solar Energy to Work. 2000-2009. April 23 2009. < http://www.solar-estimate.org/index.php?verifycookie=1&page=solar-calculator >. </li></ul><ul><li>“ The American Recovery and Reinvestment Act of 2009 (Recovery Act). ” U.S. Department of the Treasury: American Recovery and Reinvestment Act. May 5 2009. April 23 2009. < http://www.treas.gov/recovery/ >. </li></ul><ul><li>“ Thy Solar? ” Conergy USA: Renewable Energy. 2008. April </li></ul>

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