Solar Electic Power

Thanks to Ore_Ele (I believe he is from Krypton) for a superb topic. The reason it is such a good topic is that it is as close to an engineering topic as we are likely to ever see here on DDO, and engineering is more fun than anything else. Well, almost anything else. An engineering topic also means that most readers will be snoring way by the end of R2, but that cannot be helped.For this round, I want to try to establish requirements and categories of costs. I think these will be common to our designs. Grid power costWe need to know how much electricity the average homeowner uses in a year. Homeowners include condo owners in multi-unit buildings. It's doubtful that condo owners will be able to put solar panels on their roof, but the numbers don't seem to change to much by excluding them. The U.S. Energy Information Agency provides a Residential Energy Consumption Survey (RECS) [1. http://www.eia.gov... ].The relevant spreadsheet [2. http://www.eia.gov... says the average home uses 12,656 kWh of electricity. The data appears to have been updated to 2009, the most recent yea available. I'm currently under the impression that electric power consumption is about steady year-to-year.The average residential rate for grid power is 11.09 cents per kWh. It's cheaper in Lexington KY, our chosen city, but I'll use the average rate. Our average homeowner uses $1402.55 worth of electricity per year. That's the target for a solar power system to beat. I'm assuming the grid cost includes taxes buried in the total.Solar costsWe need the add up the costs for installing a solar electric system and convert them to a yearly basic for comparison.Purchased solar panels. This is the price of the panels divided by the life expectancy. Some panels only last 15 years, but 20 or 25 years is more common. The panels deteriorate by 0.5% to 1% per year so the system must be oversized by 12.5% to 25% to compensate. On cloudy days, the solar output drops in half. To make up for a long string of half-power days there has to be either battery storage or the system must be doubled in size from the nominal calculation. Doubling covers a period of cloudiness of unlimited length, so that seems better. I assume that doubling the size would also accommodate unusual periods of high heat that produce high air conditioning costs. I know it helps that summer days are longer, otherwise the peak would be more severe. It does not suffice to provide enough total energy over a year. The peak loads must also met. On the power grid, peak load costs are met by keeping spare capacity in the system.Inverter and batteries.An inverter system must be provided to convert DC from the panels to AC. The inverter system is sometimes included with batteries to provide peak loads and night operation. Inverter systems are advertised to have a life of ten years. Batteries must be kept half-charged to prevent damage, so the size of the battery system must be double the nameplate rated capacity. [3. http://solarpanel-direct.com... ]Other equipment related costs. In addition to the basic equipment, there are costs for shipping, installation, and sales tax.Maintenance. Solar electric systems require cleaning dirt off the panels twice a year, plus snow removal as often as it snows. Looking at the weather records for Lexington, I'm guess there are about five snow falls per year that require snow removal. There is also some maintenance in inspecting and cleaning battery terminals. [3] The homeowner might do this himself, but we are trying to make an apples-to-apples comparison to the power grid, where maintenance is included in the delivered price. The homeowner also might be unwilling or unable to do roof work.Cost of Capital. This is cost of having money tied up in the solar electric system. One way to think of it is he cost to borrow the money to build the system, but it could also be thought of as the value that would be received by investing the money. If capital costs are not counted, then you can get free electricity forever by just putting money in the bank and using the interest to pay the electric bill. Capital costs must be counted.The question is what interest rate to assume. I think the appropriate interest rate to figure is the rate on twenty year utility bonds. We are financing power here, so that is an interest rate for the money used for building power plants. Homeowners are unlikely to get rates as low as public utilities, but homeowners would also have trouble finding a safe investment with a higher yield. The current yield is 4.3%. [4. http://www.finance-mentor.com...] For every $10,000 spent on a solar installation, the cost of capital is $430 each year.My opponent may chose design variations to optimize costs. For example, one might oversize the installed panel capacity by 10% to compensate for deterioration, and then add 10% panel capacity after ten years. Perhaps there are more clever design alternatives. However the system is designed, all the categories of costs must be accounted for.For the record, I agree that reducing dependence on the power grid is a terrific goal. It would get the government out of the loop, and it saves all the money spent on grid costs. About four of the eleven cents in the cost of grid electricity is spent on the power transmission overhead. But while getting off the grid is a terrific goal, achieving competitive cost is probably twenty years away. We'll see.