Tag Archives: house batteries

Going Solar Part 2

Before we jump back into solar, I’m going to tell you that wherever you see *aig* on an image caption, it means it is an Artificially Intelligence Generated image. Generally using gemini.google.com. Had to dip my toe in the AI thing to help break up the longish paragraphs…

A typical winter day with a 13.6 kWh FranklinWH AC coupled battery, 18 Rec Alpha 410 Watt solar panels (7.36 kW) and Enphase IQ8 microinverters looks like Chart 1, below. Positive values are USAGE and negative values are EXPORTS except for the yellow (solar) production. Just before 8:00 AM you’ll notice a little cyan (house utilization) peak. This was partially offset by solar production (yellow) and part offset by import from the grid (purple). After 3:30 PM another little cyan spike is partially offset by solar, and part battery discharge. See the legend for more details.

Chart 1: A typical winter day production with a battery system.
(1) Insufficient battery so drawing from the grid (purple).
(2) Using energy while the sun shines (cyan)
(3) Riding out the PEAK and night with battery (green)
(4) Charging battery (green) and exporting to the grid (purple)
(5) Battery charge percentage

System Quirks and “Gotcha’s”

There are a number of things that can go wrong or be wrong with your solar setup. Many revolve around what is observable/measured and what is not.
In particular, if your system is unable to see the big-picture consumption it may not behave as you expect, and you might, for example, get surprises from your utility company when they bill you for much more than you thought you’d be billed.

We’ve already thrown around the terms “kilowatts” (kW) and “kilowatt-hours” (kWh) like a pro, but let’s give them quick definitions. A kilowatt is a thousand watts and is a measure of power. An apt analogy to watts is the pressure in a water hose. A kilowatt-hour is a measure of the AMOUNT of that power used in a given time. It is a measure of energy. In our hose analogy it would be the number of gallons or liters that are used from the hose over a given time. And you might also remember that a watt is equal to 1 amp at 1 volt – but that’s not important here.

Excess Energy for Sale

Your utility may reject YOUR solar energy and may in fact try hard to prevent you from installing your own power production. *aig*

Many people, especially those with solar-only systems assume that the best use of the excess energy is to feed it back to the utility company and get credit for it. But that’s less true every day. Typically there is an incentive for exporting excess but as solar energy becomes more prevalent, there is less incentive for a utility to WANT your energy, and they typically will not want to pay you for it. Some utilities won’t pay you for any energy you export as we described in Going Solar Part 1. Some utilities see your energy generation as competitive and are therefore hostile to having to pay anything for that energy (even though every kWh that you export they don’t have to generate and can sell to your neighbor at a hefty profit). In fact, at “grid scale” (very large) solar farms can produce energy at a cost of about $0.0025 per kWh and they’d much rather charge you 33 cents for their 2.5 cent energy! As solar becomes more prevalent, a utility company is much more likely to incent you to send them energy when they are not able to produce it themselves (i.e. when the cheap wind and solar systems are NOT producing).

There are currently four major billing/reimbursement models:

Net Energy Metering – in the early versions of this model there is often a one-to-one correspondence between energy you use and energy you export. But the value of the energy is usually NOT a one-to-one credit, and can vary dramatically.

Net Energy Metering 2.0 – again, the specifics vary from location to location, but generally version 2.0 means you get SOME credit, less “non-bypassable” charges for energy you export. The 2.0 implies that the value of the export is roughly equivalent to the value of energy you import. Some utility companies (with the blessing of state public utility commissions) charge you the full rate for the electricity you consume and only periodically (once annually) credit you for the energy you export. The credit may be dollars or kWh and usually cannot be carried over to the next period.

Net Energy Metering 3.0 – generally this model is similar to 2.0, except it implies that the exported energy is credited at the “wholesale” rate and that rate is typically miniscule. Most 3.0 plans also run on monthly billing cycles, not the protracted cycles of 2.0.

Demand/Response Billing – this is a “wild ride” where the value of energy you consume (import) and the value of the energy you export are driven by current loads, time of day and the market forces. The rate can swing dramatically at 15 minute intervals. And curiously there are some times of day when you can be PAID to consume energy (because there is excess load on the grid and the power needs to go somewhere). This method of billing is not very common for residential customers in the US, but it is “behind the curtain” of all of the utility companies. The California Independent System Operator {CAISO}, for example has fascinating graphs of the costs of energy. I am aware that in the UK Octopus Energy has several plans including a demand/response plan that they call Agile. The US Department of Energy has details on other Demand/Response plans, but I notice the majority of them are only available to large energy-using businesses.

Chart 2: The wild world of wholesale energy pricing. The “LMP” (Local Marginal Prices per Megawatt-hour) can be both positive (e.g. $14 for Kirkwood, and New Spice), and negative as shown here for San Mateo, Curtis and Morgan Hill). I’ve filtered out the higher costs, but at this same time the highest energy costs in this area were $67 for Hollister. The average cost is $10.97 across the region. ($0.011 per kWh!)

Not for-profit utilities will prefer to get their energy at the lowest cost so they can charge a lower cost. There are a few utilities that offer plans to those with batteries that allows them to discharge your battery to the grid to help with load imbalances. These arrangements are referred to as Virtual Power Plants (VPP) and as battery adoption and capacity ramps up, this strategy could save utilities BILLIONS of dollars in cost – because, well, customers have borne the cost of the batteries themselves. OhmConnect was formed to be a VPP of a different sort. I participated aggressively with them until my solar system made it impractical. OhmConnect is a large base of people who agree to reduce energy usage at specific times in order to gain incentives (like cash and prizes). A utility that can coax the batteries of hundreds or thousands of customers into helping them out is a powerful tool. Of course such plans usually come with monetary incentives, too, below is one example.

Enrolled battery systems will be directed to discharge every day from 7 p.m. to 9 p.m. during the months of August through October, a critical window when energy needs are highest in California. In exchange, customers will receive an upfront payment of $750 and a free smart thermostat for participating. 
~ Sunrun announcement

The utility company taking kilowatts out of your battery 🙂 . *aig*

Would I trust my utility company to use my battery and energy wisely? NO! However some installers, a FEW battery manufactures and a FEW utility companies are adopting VPPs. Tesla, Sunrun, and sonnen are some of the battery manufactures with such arrangements. FranklinWH and Enphase have announced plans, but have not yet rolled out this potentially game changing technology as best I can tell.

Electricity is like apples. Your utility company can only count what you send them, not how many you pick. *aig*

How Do Utilities Determine My Net Usage?

Why doesn’t your utility company credit you for all the energy you generate LESS the amount that you use? Unless you have multiple meters the utility company only sees your exported energy AFTER your house consumes what it wants. The analogy I like is this: you pick a basketful of apples from your tree. You use some of those apples to make pies, some to make applesauce and you give the remaining apples to your neighbor. Your neighbor is grateful for the apples, but doesn’t know how many apples you originally picked, only that they got half a basketful. The utility is like your neighbor, only less friendly – and the apples in this analogy are kilowatt-hours of electricity.

By the way this same “net usage” principle is why a partial backup battery solar system may only see SOME of your usage as we mentioned in Quirks, above.

The Kilowatts are Stacked Against You

The ratios may be stacked against you. *aig*

Before assuming that selling electricity back to the utility is your best option, pay attention to the rates. In Northern California and many areas of the country your electricity cost has at least two components: the cost of generation of the energy (free in the case of solar – discounting amortization and maintenance of the equipment), and the cost of distributing that energy over the poles and towers, under the ground, through the transformers and wires that comprise the grid. As explained earlier, some utilities will give a FULL credit for what you export, some will give full credit less “Non-bypassable” charges – including “minimum delivery charges”. Unpopular plans, like NEM (Net Energy Metering) 3.0 in California mean that excess energy is reimbursed at a paltry $0.05 per kilowatt hour. But the minimum cost to import that energy is about $0.35 per kWh. Under NEM 3.0 to break even you have to export 6 to 12 times as much energy as you import. Ah, but it is costly and not allowed by most utilities to generate that much EXTRA energy, and nor is it practical to do so, especially in the winter. It’s also worth noting that if you are connected to the grid there is some cost to maintain that grid and the utility needs to recoup that cost in order to provide you a service.

These factors create a problem just as with roadways that are funded with gasoline taxes. Less gasoline consumption equals less road funding = deteriorating roads for all drivers. Less electric energy consumption from the utility results in less funds for maintenance of the grid. It’s also a bit unfair to those in apartments or with insufficient income to afford their own solar generation – because those folks are “left behind” to pay for those grid maintenance costs.

The one thing I will leave you with in this discussion, however, is that you almost always will get more value out of USING that energy than it sending it back to the utility. Some ways to do that are described in “Energy Hacks”, below.

Battery Or No Battery?

Chart 1 again…

A close look at Chart 1, you’ll notice that the battery system (green graph) is providing all of the energy to run the house after the sun gives out around 3:30 PM in the winter.
Moreover, the battery is being charged from about 8:20 AM until the battery is fully charged at about 1 PM. Thereafter excess energy is then sent back to the grid. You can even tell from the graph that the energy sent back to the grid on this relatively productive winter day is less than the amount of energy imported in the morning (1).
Another take away – the battery didn’t discharge from midnight on because it was set to maintain a minimum 25% charge for emergencies. In this case setting that minimum lower (e.g. 5%) may have avoided ALL of the grid imports on this day!

One obvious takeaway is that the battery is charged “for free” and is used to cover the cost of energy from 3 PM through midnight. Indeed for our home system that energy will generally last until about 2:30 PM the following day. That means for this winter cycle we use ALMOST *NO* energy from the utility at all! One reason energy was imported (other than the 25% reserve) is that the prior day production was low. Notice how the battery level at the end of this day was 60%, but it was only 25% in the morning.

Even if you have a great energy export rate, a well sized battery can prevent almost all import costs!

Some assume that with JUST a battery they can MAKE money by buying it at off-peak rates and selling it back at peak rates (provided that option exists). And yes, that CAN work, but usually won’t unless these things are true:

  1. The rate differential is at least 15% (charging and discharging the battery incurs an average 11 to 14% LOSS). Don’t believe the 6% or 11% figures – those are under IDEAL conditions.
  2. You can actually GET a higher export value for exported energy (or a higher value than the import cost).
  3. You do not have to then also IMPORT energy during the peak period, or a significant amount of off-peak energy.
  4. You are able to export energy while also supplying your home. Remember the apple analogy? If your home load is high, both the battery discharge capacity, and the home load consumption will prevent you from discharging. For example, if your battery discharge rate is 5 kW and you’re running a 4 kW oven, the MOST you’ll be able to discharge is 1 kW.

Let’s do some quick math on the these points to make it clear. Let’s divide the day up between off-peak, generation time (the sun is shining and producing ample energy to supply the home), and peak (non-generation) periods a typical home may use 10 kWh during generation time (all of which is offset by solar production), 7 kWh during PEAK non-generation time, and another 10 kWh during the remaining time (which is usually also off-peak like late night and early morning where there is no generation). Let’s further assume peak rates are $0.50, off peak $0.30. The energy you would need for the non-generation period totals 17 kWh: $3.50 is peak, $3.00 is off peak.

We have these three choices:

(A) Use the energy in self consumption mode only (don’t discharge to the grid unless the battery is fully charged);
(B) FULLY (as much as possible) discharge the battery to the grid during the peak and earn per kWh exported;
(C) Limit exports so that you only discharge as much energy to the grid as is NOT needed to offset off-peak usage.

The last strategy isn’t easy to implement, because we have to guess how much energy will be required through the peak and off peak periods until generation resumes. The best strategy depends on the USABLE battery size and the export rate.

If the export rate is less than the off peak import rate, exporting energy only makes sense after there is no non solar peak or off-peak energy to offset.

Compare Table 1 with a favorable export rate and Table 2 with an unfavorable export rate below. Both are daily comparisons at different battery sizes, utilization and rates. Two obvious takeaways are that a battery CAN save if there is a good export rate (Table 1). The size of the battery relative to non-solar use dictates how much savings are possible. In both cases the maximum savings/earnings are achieved if there is sufficient battery to cover all PEAK and off peak usage. In Table 1, Exporting All possible energy during Peak is clearly the winner, but a Limited Export strategy also works – but no strategy has a positive cashflow unless the battery is > 18 kWh. That’s not to say a smaller battery is of no help, compare the 0 sized battery to the others and all battery options reduce the net cost by about $2 to $5 per day.

Usable Battery SizeSelf ConsumeExport ALL PeakLIMIT Export
0-6.50-6.50-6.50
5-4.30-4.30-4.30
10-2.46-1.92-2.46
2003.360.36
Table 1: Battery Usage Options at $0.60 Export rate;
7 kWh @ 0.50 peak and 10 kWh @$0.30 off peak

If the export rate is unfavorable (e.g. $0.05 in the case of NEM 3.0), then limited export or self consumption are the best choice, – if the battery is sufficiently large. Trying to export energy is a money losing strategy. However as in the prior case ANY battery will reduce the costs!

Usable Battery SizeSelf ConsumeExport AllLimit Export
0 -4.90 -4.90 -4.90
5 -2.70 -2.70 -2.70
10 -1.26 -2.21 -1.26
20 0 -1.77 0.23
Table 2: NEM 3.0 ($0.05 Export rate);
5 kWh @$0.50 peak and 8 kWh @ $0.30 off

Partial Or Full Backup?

When installing a battery system there are a number of constraints. Most them were described in Part 1, but briefly: there are three important specifications: total capacity in kWh, peak discharge rate in kW, and sustained discharge rate in kW. Because of these limitations, it’s often recommended to install a PARTIAL back up system where some number of circuits (essential circuits) are covered by the battery should the grid go down, and the other (non-essential) circuits lose power. The reasons to NOT backup things include: a very high starting or sustained energy draw (e.g. an AC, Heat Pump or pool pump motor) vs a desire to protect things like refrigerators, lights and comfort power like TVs, routers and commonly used lights.



But there is an often UNDOCUMENTED sinister side to this arrangement. Specifically a battery system can normally see all the solar inputs, the battery charge and discharge and the use of the essential circuits. But unless monitoring devices called “CTs” (current transformers) are installed, the system cannot see the rest of the circuits. This creates three problems:

1. Your system won’t know how much energy you are actually using… so what your system says you imported or exported from the grid is NOT what the utility company sees and this can be confusing. If you refer to Chart 3 below, you can see that energy coming from the grid that does NOT go through the solar/battery panel isn’t observable by the components that come after the solar/battery breaker.
2. Normally battery systems are configured to charge the battery with excess solar production (meaning energy would flow back to the grid). However because the system doesn’t see the non-essential consumption, it may elect to charge the battery instead of using the solar energy to run your air conditioner or space heater.
3. You won’t be able to know how much energy you are using at any given time with the system app. This makes it harder to chase down energy hogs.

Chart 3: A Line diagram of a solar system with a battery backup that can run when the grid is down.
1. The main meter/grid power.
2. The breaker that ties the grid to the solar/battery system. Other breakers/circuits in this panel are NOT backed up.
3. The internal disconnect. If there is no power coming in, the FranklinWH aGate (brains) throws a “switch” disconnecting the solar and battery from the grid.
4. The “essential loads” panel which is backed up and will continue to run if there is solar power OR battery power (or both).
5. The solar panel “combiner” box – attaches to the panels on the roof.
6. The FranklinWH aPower (battery).
NOTE: I elected NOT to connect the AC to a smart circuit and instead plan to connect an EV charger.

In my home system we elected to NOT include a radiant under-tile floor heater, the AC and 8 or so other circuits, unfortunately including what we thought was an “unused” bathroom plug that is the source of the power to our security cameras. One take away here… make sure you know what ALL your circuits control before making choices for a
partial backup system.

As you might guess, the floor heating system uses some significant power when it’s running for 5-6 hours a day and 850 watts per hour is up to 5.1 kWh per day or 153 kWh per month ($51 at the best off-peak rates)! It was more than a little disappointing when we got our electricity bill for the first full month and saw a LOT more imported energy than we expected. Mind you the bill was about 10% of what we had paid the previous year, so we weren’t complaining much. We plan to move this circuit to the backup panel to avoid the “gotcha” since we clearly have sufficient battery to make it possible.

However the other catch to this situation is that WHEN one uses power matters. (See Energy Hacks, below).

Energy Hacks

I see lots of commercials about doing your laundry, running your dishwasher and charging your EV at late night or morning. That makes sense if you have to pay to import energy because it moves those activities to the lower rate period. However the LOWEST rate period for a solar system is when it’s producing enough energy to cover the consumption… that is DURING DAYLIGHT hours. So that proverb about making hay while the sun shines, applies also to electricity usage.

If you have solar energy… use it while you have it! *aig*

The MOST cost effective way to use generated energy is use it when it’s sufficient to run your appliancesMost of the time that will be from about 11:30 AM to about 2:30 PM and even later in the summer months. You’ll have no conversion losses (except from the DC power on the roof to the AC power for your house). However its a good idea to make sure there is sufficient energy to also charge the battery system in case you need it for an emergency outage, and to avoid the peak rates which start right about sunset. For a bigger battery, it’s optimal to gain enough charge to see your home through all the peak and off peak hours until generation begins again. Another trick is to stage your heavy appliance usage such as doing the washer and dryer loads before or after you may need that power for your air conditioner. Indeed, tracking when you have excess solar production can be quite helpful to saving energy.

When Do I Have Excess Solar?

Ideally there would be an easy to use automation that does useful things like charge the EV, run the AC, and more WHEN there is more energy available from the sun than is needed. Figuring that out manually is doable IF you can see the actual energy from the viewpoint of your utility in real time. I ended up using Emporia Utility Connect, and Emporia VUE energy monitors to supplement my monitoring regimen because my partial-backup FranklinWH system doesn’t see the full picture. Either or both of those tools paired with Emporia Smart Plugs allow me to do some automation. One of those is a “Greener Hack” I describe below.

Optimizing Payback (Getting Paid for Excess)

We touched on the “export” option, but the gist is pretty simple. Unless you can export energy at a greater profit than the cost to import it, it doesn’t make sense to try to export energy to offset your bill. Under NEM 3.0 a strategy of extreme self consumption is usually most cost effective, and the least prone to rate changes.

Getting a Little Greener

Our house has a natural gas furnace. It is not “green” by any means, but it runs well, and because our blower/thermostat IS battery backed up, we can heat our home even if there is no grid power. However watching electricity flowing back to the utility made me realize I could do even better!

I bought three 750/1000W space heaters with mechanical thermostats and NO remote control. Notice the maximum energy usage is 1000 Watts which is 8.3 amps at 120 Volts. I paired each of them with Emporia Smart Plugs that have a maximum sustained usage of 10 amps (1200 Watts). Why mechanical thermostats? Because most of the fancy heaters these days – especially those with remote controls will NOT come on when the power comes on. Those with mechanical thermostats can be set up so that when the power is on, they will run and produce heat up to the maximum mechanical thermostat setting WITHOUT needing intervention.

*aig*

IMPORTANT Safety NOTE: Your smart plugs generally can NOT handle a typical space heater load. Nor should you use extension cords or power strips. The typical extension cord and power strip is undersized for the current used by a space heater and may overheat and catch fire.
BEWARE!

Using the Emporia App, I set up those smart plugs in the “Excess Solar” option. I’m not entirely sure how their algorithm works, and I had a few surprises, but mostly it seems to work.

Here are some screenshots from the Emporia app.

A smart plug configured to turn on when there is excess solar. Notice the Cyan color indicating it’s on. This smart plug just turns a lamp on to let us know when we have energy to “burn” on things like laundry and space heater.

The configuration of “Excess Solar Management” looks like this. It is under the “Connect” device which watches what our meter is reporting to our utility company in real time.

This is how the smart plugs are configured. “Excess Solar Indicator” is turned on if there is excess solar followed by each of the items listed and “on”. It can also change the living room thermostat.
The “meter” status with one of the space heater plugs overlaid on it. The app, unfortunately doesn’t let you plot more than one thing at a time.

Time of Use Plans and Battery Systems

Curiously, my experience is that most systems (FranklinWH, Enphase, and more) don’t take FULL advantage of rates. In the FranklinWH system for example, I had to set up a plan to force my system to NOT import during the off-peak time and instead import during a “super-off-peak time” which I created. This rate doesn’t actually exist, but the problem is that off-peak is Midnight to 3 PM. But charging the battery at midnight means burning money by importing from the grid. However if I force it to wait until noon, then my solar system gets a crack at charging the battery for FREE before the Time of Use plan drinks costly juice from my utility. And if the sun has been insufficient to the task, it makes sense to spend a couple of hours charging the battery before the “Mid Peak” and “Peak” rates kick in and drain more from my wallet. But this is true for me because my off-peak rate is $0.334 but the summer peak rate is an appalling $0.724 – that’s more than enough difference in rates to make up for the roundtrip losses using the battery. Setting this up in the current FranklinWH app is a bit too tedious to explain, unfortunately. I’d point you to Reddit where it’s been discussed. When you switch between modes or edit the Time of Use schedule and rates watch it carefully! I made a mistake and instead of playing out my battery at off-peak, it elected to import from the grid to cover my household use instead. My utility company netted an extra $2 a day from me due to that mistake!

Questions To Ask

If you’ve made it this far, you’re probably wondering… what questions should I ask my installer, and what things should I try to discover for myself.

  1. How long have you been in business? When did you do your first residential solar panel installation? When did you do your first do a solar + battery system? How many total installations have you done to date? Is residential or commercial solar systems your primary company focus?
  2. Are you the company that will do the installation? Or are you a broker, or reseller, or sales organization? If the installer, do you have a C-10 Electrical contractors license?
  3. Do you stock equipment like solar panels, inverters and batteries?
  4. What is a typical work-start to system-completion timeframe, currently? What causes the bulk of that time to pass?
  5. Do you do warranty repairs, or monitoring of the systems you install?
  6. Is the crew you use your employees, or do you contract out some or all of the work?
  7. Are your skilled workers paid competitive rates?
    > Why this question? An increasing number of utilities (e.g. Pacific Gas and Electric) will not certify/allow interconnect if the workers are not paid “competitively”.
  8. Can you quote me systems that optimize my return on investment? Please be sure to include the expected total cost over 5, 10, 15 and 20 years. (This is especially important if you are thinking of getting a lease, a Power Purchase Agreement, or financing the purchase with a loan).
  9. Do your estimates and financial models include degradation of components like solar panels, batteries and inverters? What annual energy cost increase (or decrease) is assumed in the model?
    > A model that assumes NO cost increases may be conservative, but might also be more accurate than one that outrageously assumes cost increases.
  10. Tell me how you affix racks and panels to my roof. What methods do you use and what guarantees do you have regarding roof penetrations and roof leaks.
  11. Does the system you propose have tools that will make it easy for me to monitor and track my daily and monthly energy consumption? I.e. can I expect the system to agree with my utility company to within, say 5%?
  12. Why did you propose these panels, inverters (and batteries) over others?
    > It may be familiarity, cost, or availability that leads them in one direction or another. And it might be profit.
  13. Do you have any reference accounts for a system similar to the one you are proposing that I can compare daily and monthly costs with my own? Preferably another house in the same area or neighborhood?

If any of those questions make your proposer/installer hesitate, I’d suggest treating them with circumspection. Also, it’s rather useful to get more than one estimate from more than one installer because two estimates sometimes reveal things you may not think about. For example one estimate might include a larger battery and a smaller number of panels or vice versa.

Finally my $0.02 on the cost: it’s unwise to try to pay the “lowest possible cost”. If you want your installer to stay in business to support you and do repairs under warranty, you need to pay them enough to make a profit that keeps them in business.

Disclaimer of Warranty and Stuff

If you’ve got general questions, I’m a night photography guy who is nerdy enough to dig into the minutia of things like this. I’m not making myself available to answer every (or any) question you may have. But I can recommend some resources worth looking into.

* Reddit subgroups [Solar, FranklinWH, Enphase, Electrical, EmporiaEnergy]
* YouTube Channels: [Gary Does Solar some very practical advice from a Brit, Solar Time with Martyna – some interesting comparisons of panels and the effects of shading)

Related Topics:
* Tech Connections: My Furnace is Too Big; Your HOUSE can Store Energy, too

If you want to ask, feel free to ask. If I see enough interest in a direction I’d like to go, there might be a third article in this series!

Going Solar – Part 1

PHOTO 1: Award Winning Solar Photo by the Author (click for more information)

This is NOT about photographing the sun, at all. In particular it’s not about the upcoming total solar eclipse visible from the central to North East! This is a public service column about the good, the bad and the ugly of using solar panels and/or battery systems.

Being the engineering geek that I am, I have invested a lot of effort into researching, cost modeling and using a photo voltaic solar panels + battery system. In this column I hope to provide some thoughtful comments and insights into the benefits, and pitfalls of having such a system. Let me however give a bit of background so you understand the context.

Photo 2: Our modest (18 panel) solar system. Note the chimney shadow from late afternoon and how they avoided placing panels where they would be shaded.

Why Did I Go Solar (+Battery)?

A desire to avoid taxes. My father passed away 5 years ago and I inherited a portion of his IRA. Contributions to a 401K are tax deductible but withdrawals from such an account are taxable. I was required to take a full distribution so it was the primary impetus for my solar journey. I had been paying attention to, but not dipping my toe into solar – frankly because our electricity costs for our modest house were relatively low… that is until some brutal summers kept us indoors with massive use of an air conditioner. But the 30% Federal Tax Credit was hanging there before my eyes so by investing in a solar system from my inheritance, the taxes would be covered almost entirely AND I get an energy production system and emergency standby power during a grid outage as a side benefit. I really needed for the system to be completed by the end of 2023 for the finances to make sense otherwise I’d be paying for the system in after tax dollars. Fortunately my installer: Cinnamon Energy Systems of Los Gatos, California delivered for me! My situation is unique here since most people will be paying for a system out-of-pocket in after-tax dollars.

Chart 1: PGE Electricity Rates (cents per kWh). This does NOT include minimum monthly bill or natural gas charges or other miscellaneous charges on the utility bill. That’s a 79% increase in 5 years.

Steep, ongoing increases in electricity rates. I live on the West Coast in Pacific Gas and Electric territory. PG&E (together with Southern California Edison, and San Diego Gas and Electric) are the largest utilities in the United States. They are FOR PROFIT companies. Coincidentally PGE and SDGE have the most expensive electricity rates in the United States with one exception: rates in Hawaii are slightly higher. In 2022, for example, the national average was $0.1504 cents per kilowatt hour (kWh). My PGE charges in November, 2022 were $0.3779 / kWh – TWO AND A HALF times as much as the national average. And it’s gotten worse. From 2019 to 2024 PGE rates went up by 79% in total. And they are asking for 4% increases each of the next 3 years. In January, 2024 my rate is $0.4323 per kWh (and that’s actually a reduction from what it would have been because with solar self-production, I was able to stay in the lowest tier rather than paying $0.4728 per kWh). With the current sky rocketing rates, the system pays for itself a LOT faster than it will if energy rates were lower. Our utility bill on the current trajectory will become the single LARGEST recurring cost after health care insurance and ahead of real estate taxes! As we approach retirement, retiring the electric bill will make for a more affordable post-work period.

Being Green. This is actually the least of the reasons. I’m pro-planet, pro-environment but I also know that it will take about 2-3 years of energy production from my system to become “carbon neutral”. Carbon Neutral means that the CO2 produced during the manufacture, transportation and installation of this system will be offset by the CO2 saved. But three years is not a long payback period! An Electric Vehicle is inevitable in California… and again, even though EVs require more energy to build than conventional internal combustion engine cars, I can fill my eventual EV with 100% non-polluting FREE energy. I intend to use my EV as a big mobile battery to backup my home as well as provide transportation. Will I replace my natural gas furnace + AC system with a heat pump? Eventually, yes. Will I replace our natural gas dryer, cooktop and water heater? Eventually, yes. And when I do, most of the energy those require will come from *free* power generated on our roof and squirreled away in our batteries for those rainy days that do come.

So in short, I’m saving money for the long term, helping the planet, and enhancing the value of my home. What’s not to love?

Is Solar All They Say It Is?

There is not a single answer to this question. It depends. The POTENTIAL cost savings and clean energy benefits are clear, but does it make financial sense for everyone? Probably not. Where we live we have 4 significant factors in our favor:

  • 1. Our home has an unshaded back-of-the-house roof that faces SOUTH (the ideal direction for maximal solar power generation)
    • 2. Our climate is mild (cooler temperatures are more conducive to energy generation). Heat both reduces production and takes a toll on the materials. A mild climate also helps moderate the need for energy for heating and cooling.
      • 3. Due to our climate we have more “clear sky days” than much of the rest of the country. But its worth noting that even dreary, dismal rainy days can produce energy, too!
        • 4. Our electricity costs are extremely HIGH and increasing much faster than inflation.

Beware the Charlatans and Scam Artists.

Many solar companies are struggling due to regulatory and non-sensical billing policies established by Public Utilities Commissions – I’m not talking about those, however there are rampant problems with the Solar industry. It’s rife with charlatans, scams, and lies. I cringe every time an add pops up saying “If you live in (STATE) the state HAS to give you FREE solar panels”. Every word of that is a lie. While a “lease” or “Power purchase agreement” MIGHT make sense for some people, I would generally offer that you should avoid them. Why? Because no one is giving you free solar panels! You’ll pay for them via the long term power purchase or lease agreement and in both of those cases you actually own nothing. Those installers ARE making money because the gross cost for those arrangements will always be more than the cash cost for you to buy the system and own it. Another reason I cringe is that the lies told to lure customers in include everything from saying that the Federal Tax credit can be used to cover a re-roof (they can’t), that the Federal Tax credit is a rebate (it’s not, and not everyone will be eligible), that if you don’t lease or use a PPA that your maintenance costs will be very high (solar panels are among the most reliable components typically with 25 year manufacturer warranties, batteries and inverters are less reliable, but are more reliable than most of your appliances!).

The good news is that some solar companies are going out of business (ADT, Vivint) because they rushed in to take advantage of a “market” with a bad business structure, did a poor job or ran out of people to scam or, worse, they closed shop under one name and opened back up under a new name.

Why Local Clean Energy Production is a Great Goal.

Ultimately it’s clear that local production of energy (with local storage) is good for creating a more resilient power grid. The more energy is produced locally, the less stress there is on the grid, and the less there is a need to build costly power plants and infrastructure, the more resilient it is, and the cleaner the overall energy mix becomes. Utilities SHOULD be prioritizing cleaner, lower cost energy to move away from using polluting, limited resource fossil fuels. But of course those for-profit companies don’t share that sentiment because it undercuts their money making ability.

Why Utilities Need to Be Public and Not for Profit.

Unfortunately Pacific Gas and Electric is a poster child for what happens when a shareholder-owned, profit-driven company seeks to maximize profits. It has managed to blow up a gas pipeline destroying homes and killing 8 people, burn down at least 4 California towns killing more than 95 people in the process. In fact it’s the only utility company I know of that has been convicted of manslaughter and has filed for bankruptcy twice. Ok, got that off my chest, but it is really another inducement to produce my own energy. By the way it’s also why some communities have created public utilities for example Silicon Valley Power is Santa Clara’s not-for-profit energy source. Their rate is 0.166 / kWh. San Jose is exploring going public, as well as others. And there are options in some communities to use different power generation. For example Silicon Valley Clean Energy can provide power to residents on the San Francisco Peninsula from Mountain View down to Gilroy, but PG&E delivers that electricity and the delivery charge is MORE than the national average total charge for power.

Common Myths and Misconceptions About Solar

Chart 2: at (1) the battery ran out and energy came from the grid (2). By the end of the day (3) the battery supplied all the house energy needed up to midnight. This was also a low electricity usage day for the house.

If you have enough solar generation to cover your monthly usage, that is enough.

Untrue! Here are a few of the reasons

  1. In winter, there is less daylight (so less production), typically more cloudy weather (compare Chart 2 above, with Chart 3 below), and a lower sun-angle. You would need to design a system to generate all the energy you need in WINTER… but
  2. In summer, the longer hours of daylight and often clearer skies mean you may produce three times as much energy as you do in the winter. Unless you consume it all, you are producing “excess” energy. Extra energy is of great value, sometimes, but often not (see #6, below).
  3. Your solar system only produces energy when there is sufficient light. It doesn’t have to be direct, clear-sky sunlight, but it needs to be strong enough to generate a reasonable amount of energy. Even on overcast days our system generally produces enough energy to meet the needs of the house… though as you notice in Chart 2 sometimes it’s a struggle to do so.
  4. Most people consume energy 24 hours a day. And your daily usage no doubt is different day-to-day. For example if one day of the week you do the laundry you will use more energy on that day than most others – especially if that day also turns out to be unseasonably warm or cold requiring more heat or cooling. For example, our Christmas dinner saw us using 4 hours of oven time – the 16 kWh we used in those 4 hours just running our oven was about same amount of energy we use in a full DAY! So capacity needed varies from day to day and month to month. Oh, and most of that energy was used AFTER sunset!
  5. Producing energy is not the only criteria. For example if you want to run your Air Conditioner, it’s not enough to provide the 12 amps (2.7 kW) or so of energy you need to keep it running, you also need for your system to provide (for a time) the 60 amps of energy it takes to get that AC started! This is called peak load. Many appliances have this number printed on them even though they do not continuously use that much energy. The grid is a good source for those short-bursts of extra peak-load energy, though you CAN install enough battery peak load capacity to provide that energy. If you happen to be baking something, heating water, have a fridge in a defrost cycle all while trying to run your AC you may have to overprovision your system to meet that peak load.
  6. Unfortunately everywhere in the US (and the world) is a bit different about what happens with any extra energy you create. In some areas you can ship that excess energy to the utility company and they will pay you for it (and sell it to your neighbors at a marked up price). But what you are paid can be anywhere from equal to or MORE than what you’re charged to import energy to something as small as 1/10th of the cost of import. Indeed, some utilities will not allow you to export energy at all (or will not pay for it) because export of energy can overtax the grid! And to make matters MORE complicated, the rules are changing constantly. Any paybacks you rely on may disappear in 1 to 10 years due rate changes, additional charges, etc. “Net Energy Metering” (NEM) is different everywhere.
  7. You might NOT be able to produce enough energy to meet your peak and capacity needs! You need sufficient unshaded roof or ground space to install the needed panels. For example there is one tall tree about 100 meters (340 feet) away in the late afternoon path of the winter sun that causes our production to dip for about an hour even on clear-sky days. See the Chart 3, below, which captures a “good” winter solar production day. Also compare with Chart 2 which was a not great production day. About 4 weeks later, the sun remains higher in the sky so we don’t see a production dip at all after mid January. The takeaway on this is that your own trees, neighbors trees, power poles or other objects might put an unexpected dent in your production. Clearly the loss in this particular example is miniscule.
Chart 3: A good day of energy production
1. Importing from the grid
2. Charging the battery
3. Clear day generation.
4. Shading from a tree.
5. Battery charged now exporting to the grid
6. Running at night on batteries.

If I get solar and battery I can go off-grid and keep the power company out of my pocket.

It would be lovely if this was true. The answer to this is nuanced. Some municipalities by law require homes to be attached to the utility grid. This is generally a requirement of “habitability” (that is, a house would be considered unlivable if it didn’t have energy), but if you read through the previous misconception (it’s enough to have solar panels) you’ll see that there are plenty of times where not having the grid means your house will have to “brown out” (insufficient energy compared to demand) or black out (no energy at all). Also read above because having batteries may also not be sufficient.
And even if you CAN produce enough energy you will definitely have to change your energy usage habits significantly from what you’re probably used to (or spend a kings sum on a huge system) to go truly and completely off grid. In short, you’ll likely have a least a minimum monthly bill and as much as I’ve revealed my distaste of for profit utility companies, the truth is they are USEFUL and it costs money to maintain them and the wiring to and from your house.

Solar Panels are All I Need

What many people don’t know (I didn’t know) is if you have a solar panel system that is “grid tied” (meaning connected to your utility to back-feed that extra power that you produce as well as supply power to your house when there is insufficient solar production)… IF THE GRID GOES OUT your SOLAR SYSTEM SHUTS DOWN. It doesn’t matter if it’s noon and the sun is creating 4 times as much energy as you need. The reason is safety. If the grid goes down, a worker trying to repair a downed line could literally be electrocuted if the sun comes out and sends energy back through your house into the grid. Stated another way, if your HOUSE is producing energy, there is no way for a worker to insure safety because they can’t turn off the sun and therefore all grid attachments require electronics to automatically shut off back feeds if there is no grid power and the simplest way to do that is to make the solar system shut down completely.

Does that mean I can’t have solar if there is no grid? No. You can still have solar, but you need “islanding” capabilities. That is, your system must DISCONNECT from the utility grid and form your own “private grid” if there is no power on the utility grid. Such systems are often paired with battery systems so that a battery can supply the backup power… but it costs more to have such components.

It is also true that different systems handle shade differently. In some systems something as small as a single leaf on a solar panel can reduce the panel production by 33%. Indeed the shadow of a powerline across a panel can make a panel produce ZERO power if it happens to shade each of the separate zones in the panel.

If I Have a Battery or Battery System I Can Be Independent!

Chart 4: Using the grid for only 4% of household energy needs. Total imports were 4.4 kWh**

This is mostly true! We’ve already discussed some of the many complications of having sufficient total generation as well as enough peak power (see number 5 above).

However Chart 4 shows our electricity utilization for a week in December.
Note that “aPower” is the name of the battery system by FranklinWH.

We still needed grid power – but we only imported 4%** of our energy. The rest came from the sun directly (the yellow pie), or from the sun through the battery (the green pie). This also underscores the earlier point that almost half of our energy use was when the sun wasn’t shining, or was insufficient to meet the household energy demand.

**This graph states that we imported 4.4 kWh, but the actual number is about 7 kWh. That’s a fairly trivial difference in THIS case. Chart 4 does NOT show how much energy we exported during that week (it was significant – 47.6 kWh). In Part 2 of this article I’ll spell out why why the stated export and import amounts don’t agree with our power company and why that might matter a LOT.

Indeed there was a much worse week where we had to import almost 30% of our power because the weather was dark and bleak. By using 94% (or 70%) less electricity, we clearly have that much of a reduction on the electricity charges for our utility bill. And it’s a good thing because PG&E had not yet started processing our “Permission to Operate” so we got paid zero for the 100s of kWh we sent to the grid until it was approved.

Having a battery that has sufficient peak load isn’t sufficient to be independent. There is also a matter of capacity. We have weathered two utility power outages due to violent winds – each less than an hour for us, though it lasted in some cases DAYS for our area neighbors, and it isn’t because our battery would have seen us through the days of outage. It is because we are in a critical power area. The power lines that feed our house also feed a nearby hospital, and 4 emergency response bases (fire and police stations). Indeed two years ago we had about 4 total hours of outage over 3 days. Our across-the-street neighbors had NO power for 40 hours because they are served by different (non-critical) feeder lines!

Our current system has enough battery capacity for about 20 hours of normal load – that’s enough for us to get well into the next day for sunlight to provide energy, but as you can see from Chart 2… a bad day of production may mean the battery won’t last through a longer outage / or until the sun can provide all the household needs.

What Do I Really Want in A Solar System?

This article has already become wordy, but here are some of my recommendations. I will publish a second article on “things that go wrong“, energy hacks, and more.

But assuming you are thinking about solar for yourself, here are my recommendations.

  1. Before you consider solar, take a look at the current status of your roof, and the energy efficiency of your house. It might be wise to spend money first on resolving air leaks, insulation inefficiencies and attic and roof repairs.
  2. Take a look at your electric service (or be sure any bid you get has considered what you have). It can get pricey to upgrade electrical panels or home wiring systems to meet code requirements.
  3. Understand your tax situation if a Federal or State credit, rebate or incentive is what you’re seeking. The 30% Federal Tax credit is planned to be around for 5 years, but to get that money you have to file your taxes, AND be paying as much tax as your credit will net you. If you are on a low fixed-income you may never be able to recoup the credit by doing a purchase. This is one area where a lease (to own) may make more sense because of a quirk in the law that allows the lessor to claim the credit and pass it on to you even if you would not have a sufficient tax liability to recoup the credit yourself.
  4. Seek out bids from reputable, well established solar + battery businesses. If they haven’t been in business for at least 4 years, and don’t have good marks on the normal review sites avoid them. If your neighbors have solar – ask them. Of my surrounding neighbors 4 have solar. One used a national company that used a contractor from out of the area to do the install. The contractor and the national company went out of business. One used the same company I did (though I didn’t know it at the time), and another used a large regional company that as of this writing is still in business, but getting hammered pretty hard by the latest rate changes and high interest rates.
  5. Do some investigation on the components, methods and limitations of any system you consider. Not all estimators/installers appreciate the complete landscape. They tend to stick to what they know (if indeed they know!). In part 2 I will provide a list of question I suggest you ask.
Chart 5: December and January Production. The thick horizontal Red line is our average household load. The solar panels were turned on on December 7th. Notice December 18th through 24th only ONE day (December 23rd) exceeded our average household load. Once the system was turned on, we didn’t need ANY grid energy for the first full week