Still waiting for costs to fall
First, let me start by apologizing for the recent lack of posts. I recently had to sell my house and buy a new one, then was away for most of last week at a bioenergy conference in northern Ontario. It’s been tough to keep up with happenings in the cleantech world, let alone write about them here.
On a positive note, glad to see Vinod Khosla contributing to the discussion.
On the topic of new homes, I’ve been investigating renewable energy options for my new pad. We need a new roof. We need over the next year or two a new furnace and central air conditioner. So this has me thinking that now might be the right time to go with solar or geothermal or some combination of the two. But I’m somewhat discouraged. Yes, the Ontario government has its standard offer program, which pays 42 cents per kilowatt-hour for solar electricity sold into the grid. Yes, the federal goverment is now offering a rebate of $3,500 on the installation of a ground-source heat pump (geo-exchange) system, and on top of that the province is offering a tax break. And because I need a new roof, I explored building-integrated solar products, with the hope that a new roof made with solar shingles would be affordable because I could subtract what I would normally have to pay for a new roof made of asphalt shingles.
I found a distributor of Uni-Solar shingles in Saskatchewan and asked him for some pricing. Each square foot of the shingles offers about 5.6 watts. We estimated I’d need about 178 shingles for a 3 kilowatt system, or 118 for a 2 kilowatt system. The retail cost of each shingle, however, is $198. So a 3 kilowatt system would cost about $35,000, while the 2 kilowatt system would be $23,000. Now, let’s keep in mind that this excludes installation costs and the cost of power electronics that would be required to be grid-connected. Given I could re-roof my home with regular shingles for about $6,000 to $8,000, going with BIPV is still cost prohibitive — even with the standard offer incentive.
Okay, so what about a geo-exchange system? Certainly much more affordable, but costs can range anywhere from $25,000 to $40,000 depending on the installer. Plus, there’s a huge wait time for getting someone to drill in your yard — particularly if you live in an urban area. I’m still investigating this option and will likely go this route, but it comes with all sorts of risks.
One beef I have, and I’m sure I’m not alone, is that governments are kindly offering incentives for embracing these technologies, but lack of product supply and high demand for certified installers means prices are going up, not down. Any incentives we see on the market aren’t going to the consumer, they’re going to the suppliers and installers of renewable energy systems. The whole point of incentives is to spark demand, creating volume that will ultimately lead to economies of scale that mean lower prices for consumers. We’re not seeing that happening. What we’re seeing is industries taking advantage of a tight market. It’s unfortunate, as it will turn a lot of people away from these technologies just when we need to show that costs can fall and that government incentives contribute to that goal.
Perhaps patience is the key. Perhaps, over time, we will see costs fall. But if consumers and businesses have to wait too long, the industry will be doing itself a disservice. I agree with Khosla that we should be aiming for reasonably priced higher-efficiency solar, because technology is only part of the cost. Installation costs are huge and rising. It seems to be that the best way to save on installation is to install fewer PV panels or shingles — which means we need higher efficiency. Cheap, low-efficiency products don’t help if it will cost you more to install them.
For a New York Times perspective on the cost of solar, click here. For a Canadian perspective, click here.
Tyler Hamilton is senior energy reporter and columnist for the Toronto Star, Canada's largest daily newspaper. In addition to this Clean Break blog, Tyler writes a weekly column of the same name that discusses trends, happenings and innovators in the cleantech market. This blog is a personal project started in April 2005. It is not an official blog of the newspaper. Tyler can be reached at tyler@cleanbreak.ca
April 18th, 2007 at 10:05 am
I have done some similar research on geo-exchange stuff since our boiler was installed in 1988 and they say that these things have a lifetime of about 20-25 years – so it could basically go at anytime…but at this point the cost for a geo-exchange is still pretty intimidating…I have always thought that a niche which could use a really nice technological solution would be a way to drill holes in a better, more efficient and cheaper way…
April 18th, 2007 at 2:38 pm
I looked into geothermal and after seeing a friends installation have given up on it. They had a compressor failure while they were away for a few weeks and the electric heating element tried to compensate resulting in a one month electric bill of over $1000. This highlights one of the weaknesses of complicated tech solutions. They are great when they work but it only takes one or two failures to blow all the potential savings.
I think a better solution is to radically increase the insulation on your house. I will me moving soon and I am planning a super-insulation retrofit along with installing an energy recovery ventilator. I will be doing a lot of the work myself to save money. I am pretty sure for the cost of a geothermal system I can get better cost savings from just reducing the heating load.
April 19th, 2007 at 10:01 am
I was just curious if you looked into the costs of solar thermal for water/space heating. I’ve heard it’s the most cost competative renewable energy source, but I don’t know how much it actually costs.
April 19th, 2007 at 1:41 pm
Here’s link to the Now House Project, being undertaken in East York, Toronto. It is a Net Zero Energy retrofit of a WWII Veterans Administration home, typical of thousands built post-war across Canada for the returning soldiers. It begins with insulation upgrading:
http://nowhouseproject.com/
See also EQuilibrium Housing, a project partnered by a number of entities including CMHC and the Net Zero Energy Home Coalition.
Also, Gabriel Draven at Village Technologies just released a study of investment return comparisons between solar thermal and mainstream investment vehicles. He can be contacted at Village Technologies, in Toronto, at http://villagetechnologies.ca/
April 19th, 2007 at 11:28 pm
Citizen’s Bank of Canada just announced a Green Mortgage, here:
https://www.citizensbank.ca/Personal/GreenMortgage/
April 20th, 2007 at 11:44 pm
Hey Tyler,
Congrats on the new pad. I have done some fairly extensive research into solar PV systems over the past number of years and may be able to help you out in that area, as far as finding deals on the market is concerned.
Of course, I know that I don’t have to tell you that reducing your loads is the most important thing you could do. There are LOTS of new and innovative products on the market in this area too. Many are now mainstream as well. Insulation is KEY. Go for cellulose fill in your attic and if you can, get more blown into your walls (can be expensive). Windows are also a biggie… As far as lighting goes, you may be able to use LED’s for track lighting. I have had some success with a retrofitted IKEA system
Cheap.
As for deals in solar.. Ping me and I will send you some links. The best place I can point you to is http://www.sunelec.com out of Florida. You can get pallet deals on panels that will save you a bundle. It’s too bad you didnt ask a year or so ago – they had crates of discontinued intergrated roofing panels they were flogging.
Other things you can do – Since you mentioned the water heater needing replacement, go tankless for your water heating and/or use solar thermal (vacumm tubes are getting cheaper and are great for our climate) to pre-heat a tank before the tankless system gets to it.
Canadian company http://www.yoursolarhome.com also has some interestng heat exchanger products. Try and get as much natural cooling and lighting into your house as possible. A skylight that also provides ventilation works wonders (or even just a seasonal / solar powered attic fan).
jon at jonthorpe.com
April 21st, 2007 at 2:11 pm
Tyler,
You should look closely at the UniSolar Shingles, as
they have PFOS’s, a toxic bioaccumulating flrocarbon coating on them (Teflon like).
At the last Society of Toxicology (SOT) meeting in the USA, March 07, 20-30% of the papers and posters were on PFOA and PFOS’s! A good story here for a enviro reporter. These are the next PCB like bioaccumulating toxic disaster.
They are the wonder products (sic) showing up on every thing from solar panals, metal roofing, to carpeting.
3M stopped making Teflon years ago for this reason even though they were making large profits on it, that is if you didnt include the enviromental costs to the rest of the world.
Would love to use a product like this also on our pasive solar house, needing a new roof on the south side, and almost ordered it, but found the coatings used are bad news.
Im looking to other makers, although coming from Michigan, I which UniSolar (a Michigan co.) would use another coating as other thin film makers have.
We also are looking at geothermal heating. Over a long period the cost should be recouped, and before that the house should also have a higher resale value, expecailly as energy costs go up.
April 24th, 2007 at 4:38 pm
Are you familiar with a (residential) demand control system (DCS)? It is an incredible product that would seem to fall into the clean energy category. A DCS works with utility time-of-use rates that have a demand billing component. These systems can pay for themselves with utility savings in less than two years but, more importantly, at least for this discussion, they have a huge impact on the environment. Allow me to explain; at my home on peak demands (kW) prior to installing a DCS were 20 to 30. I now control my demands to a 7 to 10 with no inconvenience to my lifestyle. On a large scale this would allow an existing power plant to serve more customers. Consider this; lets say power plant X had a capacity of 25,000 homes, if those same 25,000 homes (with at least electric hot water and an electric clothes dryer) used a DCS the utility would be able to add another 14,000 homes to that plant. Admittedly, this system does not reduce how much energy one uses but rather shifts energy to avoid peaks. And it is peaks that create the need for more power plants.
Residential customers are very inefficient users of electricity as are churches and that is why these systems can be so effective. The way it works is the system measures all of the electricity coming into the home. When it sees that usage is going to exceed a preset limit it starts shutting things off like the water heater, heating element of a clothes dryer and HVAC. Demand is measured in 15 or 30 minute periods so it only control for 3 to 7 minutes to maintain that preset limit. Once that demand period is over it turns on anything that remained off and starts the cycle over again.
I know of two companies that manufacture such systems; Brayden Automation and Dencor. I represent the Brayden lines.
The biggest set back for DCS is that they require the proper electric rate schedule to be of any financial benefit to the customer. I am in Western North Carolina and in this area Progress Energy, Duke Energy and Dominion Virginia Power all have time-of-use demand rate schedules.
I was amazed to find out there are no time-of-use demand schedules in California. I understand from Bill Brayden that someone affiliated with his company spent 2 years lobbying California utilities and legislators for time-of-use rates and got nowhere. With time-of-use rates customers are given the incentive to reduce their demand, with no inconvenience to their lifestyle, and allow uilities to avoid rolling blackouts.
I would be interested to see what you and your readers think. Part of the utility problem is most utilities make money by building power plants and not by implementing efficiencies. The rules set by Public Utility Commissions are starting to change in the direction of efficiencies.
Thank you,
David Johnson
April 25th, 2007 at 5:37 pm
Tyler, are these costs US or Canadian dollars?
I’m astonished at the low efficiency and high cost of these tiles: 5.6 peak watts per square foot is only about 5.6% efficiency, and $198/tile is $35/watt, or 5-8x the normal rate for PV panels (assuming $US)!
On pricing: increased demands from subsidies should raise prices temporarily, in order to attract more suppliers – that’s normal market dynamics. The real question is: are there artificial barriers to entry into the market for new suppliers, like unreasonable licensing rules?
On cost reduction: the best way to reduce costs is for the building industry to make solar tiles a standard part of new-construction, and roof replacement. Currently PV is primarily a hand-crafted, retrofit industry that is guaranteed to be excessively expensive. Standardization and integration into new home construction/roof replacement would reduce installation costs dramatically. California has moved in this direction by mandating solar as a standard option by 2011.
April 28th, 2007 at 5:57 pm
In addition to the solar water heater that has been suggested, you might want to look into drain heat recovery units. If the configuration of your house allows for easy installation, these can have very low payback periods and are much less initial capital than many other retrofits.
July 14th, 2007 at 1:23 am
For a long list of insulation providers check out http://www.getwithgreen.com. They also have a shorter list of solar attic fans!