Residential Electricity from Rooftop Solar Panels

    The basis of this discussion concerning advantages and disadvantages of residential electricity from rooftop solar panels is from the following file:
http://solarcellcentral.com/cost_page.html    Anonymous CJ has taken the position that rooftop panels are a fantasy. His latest comment is as follows:
    "You must be amazed at the logic of this report:

    1. A 5kw roof panel installation with subsidies provides power at an annual rate of $654.  Purchased power would cost $926 for an annual saving of $272 on an investment of $16,355.  One would be better off putting the money into a CD even at today's rates.  Conservative investing would yield more like $1000 a year.

    2.  Without subsidies, roof panels offer no savings at all.

    This is economic fantasy ala Dr. Steven Chu."

    Simultaneously, Anonymous Dave has made the following comments:
    "In the cost of a rooftop system, I see no allowance for maintenance which involves replacing roof shingles and repairing roof leaks. If the solar panel installation can be done so as not to interfere with the replacement of shingles and repair of roof leaks when needed, then no allowance needs to be made. But all installations I have seen just slap a metal frame down on top of the shingles, so the solar panel frame needs to be moved/removed to repair replace the shingles. On the other side, shingles are mainly degraded by sun/wind/rain/sleet/hail/snow. So shingles under the solar panels would deteriorate far more slowly.

    The residential house cost breakdown does not include the cost of money. In the coming years, the opportunity cost of money may be close to zero. Since the turn of the century, the overall stock market has gained less than 2%/year annualized. Real cost-of-living inflation these days is well above 10%. CDs, bonds, and money market are all paying well below that. So Opportunity cost of money may be negative, but in the average residential installation, the money would be borrowed, so let’s use a second-mortgage rate of 5% for our cost of money. With that cost added in, it adds $10,820 interest to the total system cost for a 25-year minimum total cost of $27,175.

    Also, the cost of average repairs should be added in. On some installations, there will be damage due to wind, hail, freezing water, falling tree branches, basketballs and footballs, and weathering and corrosion of improperly installed frames and systems.

    Real-world 25-year total system cost, when factoring in all of my above-mentioned factors, will likely be in the range of $30,000-$35,000. At a real-world 25-year total system cost of $32,000, and monthly electric bill average savings of $77, breakeven would take 455 months (38 years).

    Also, I highly doubt that the true total cost of electricity from coal and nuclear powered plants has been calculated. The unforeseen collateral political costs could make the actual total costs much higher. And what about pollution from the manufacture of solar panels and inverters, and the disposal of those items when they become inoperable. How would those factors affect total real cost?

    At this point, the macroeconomic factors (national security and balance of trade) are the most important, and may make rooftop solar installations viable in ideal locations and at current costs. But within the next 5-10 years, rooftop solar should become de-facto standard for all new residential construction in ideal locations and in 10-15 years for existing housing. Also, during that time, better energy storage systems will be devised.

    As long as our nation is dependent on the import of energy from our potential or real enemies, we are extremely vulnerable militarily. As long as we are paying them vast sums of money every year, we are making them stronger while we make ourselves weaker. Hydrocarbon fuels, when burned, DO produce huge amounts of emissions. Some of those emissions are clearly polluting, and some of those emissions may in the future be discovered to be polluting. Localized solar panel installation has other significant advantages. It reduces the need of transmission lines that are expensive to construct and vulnerable to attack. It creates a more modular, self-sufficient and less vulnerable “grid system” It creates a less centralized power system – a large centralized system can easily be politically manipulated and abused.  There are many highly significant and compelling reasons to keep moving in the localized rooftop solar direction."

    Anonymous Dave then followed with this additional comment:
    "Unexpected events (probably likely within then next 5-20 years) could rapidly and catastrophically change the fully amortized costs of new power plants (coal, gas, nuclear). If a plant is built expecting a fully amortized life of, say, 25 years, and something happens to require the decommissioning of that plant after only 5 years of operation, the unit cost of electricity output of that plant then skyrockets. Appropriate and beneficial incremental adjustments on rooftop solar installations are much easier to achieve.

    I see a few big questions:

        How can we make our nation energy-independent (mainly for national security, but also for balance of trade)? I’d say gradually ban the import of energy, in a way to cause our energy prices to gradually rise to a point where we have equilibrium between various sources of renewable and non-renewable energy. This is a pay me now or pay me later scenario. We are taking short-term gains at the expense of long-term profits. We are driving by looking at the hood ornament.

        How can we stabilize our nation’s energy system for the long run? We are now too short-sighted. When something happens in the near future (5-20 years) to render our current energy systems (coal, gas, nuclear) less viable, the rapid change in amortization costs, plus the inability to quickly change to different systems, will create huge unforeseen costs and significant economic recession or depression.

        I had another question that I can’t remember."

    Since I believe we have now brought in the most relevant points regarding pros and cons of residential solar electricity, I am terminating further discussion, but also having the last comment.
    The initial report from Chemical and Engineering News on the subject was that utilities were increasing their involvement in construction of solar generated electricity production. I suggest that the likely reasons for this are twofold. Utilities believe there is some technological and economic basis for it in the longer term. They also want to take advantage of available government subsidies before they are terminated.