Ward 5 Going Solar! Join the movement!

Please see the notes from the recent meeting and see how you can join your neighbors in creating your own solar power!

Momentum is building for a Ward 5 solar bulk purchase.   A group of interested homeowners met for a third informational session with Anya Schoolman of DC SUN (DC Solar United Neighborhoods) to learn about solar photovoltaic (solar electric panels) for our homes, what it takes to come together as a group to purchase them for our homes, what the installation process is like, and what incentives are available.

First, some background:  DC SUN is a not-for-profit group of ward based solar co-ops.  A solar Co-op is essentially a loosely affiliated group of neighbors who decide to purchase solar electric systems for their houses together to save money.  Once the solar bulk purchase is complete, they can remain affiliated to discuss any issues they are having with their solar systems, or for any other reason.  Leaders of every neighborhood group meet a few times a year to discuss city-wide issues.  There are only two semi-permanent staff members of DC-SUN (Anya Schoolman and her assistant Emily); among other things they organize and promote solar bulk purchases in neighborhoods and wards in DC.

This year they have already done a Petworth bulk purchase and a Capitol Hill bulk purchase.  What exactly does a bulk purchase entail?

A bulk purchase requires at least 20 households from a neighborhood or ward to come together to decide to purchase solar panels for their homes from one solar installer.  DC-SUN does the majority of the legwork to make this happen.  They meet with interested neighbors as many times as is required to provide information about solar electric systems and discuss the purchase process.  People who are seriously interested in purchasing solar systems with the group are then asked to sign up for the purchase process.   Those who are interested are asked some questions about their homes (like “what is the condition of your roof”) and DC-SUN will pre-screen your property using Google Earth to verify that your house is not shaded.  If you don’t pass the pre-screening process you might not be able to participate in the group but DC-SUN will still offer advice as to what you might be able to do to make your home ready for solar.  The survey you are asked to fill out when signing up for the bulk purchase also asks about your preferences regarding the installer, for example, are you concerned mainly about price, or US made panels, or DC-based installers, etc.

Once 20 people are signed up and pass the initial screen, DC-SUN issues an RFP (request for proposals); any solar installer in the area can submit bids.  Any member of the group can then join the selection committee; this committee meets and pores over all the bids.  They take into account the preferences of all the members of the group based on responses to the sign-up surveys and select one installer. Even after an installer is selected, the bulk purchase group remains open for one month, any interested households in the neighborhood can still join in and take advantage of the negotiated discount.

That installer then goes to each home that has signed up for the process, does a final inspection of the property, and if everything is good to go, signs a contract with the homeowner for installation of a system.  The installer takes care of all paperwork and permits that the city and PEPCO require.  They install the system and you’re done.

Why do this as a group?

1) Bulk purchase discount.  This is like going to Costco or Sam’s Club to buy your solar system; you are purchasing the systems as a group so the installers are able to offer you a discount.  Why?  They are concentrating on one neighborhood at a time, so they don’t have to waste time and energy traveling all over the city.  They do not have to go house to house offering estimates only to lose out to another installer; they bid on the process knowing which houses are interested but they don’t spend hours of labor to lose out on the process to another installer; this reduces their cost.  DC-SUN estimates that we will receive at least a 20% discount but participants in recent bulk purchases in other neighborhoods in DC have received significantly higher discounts.

2) DC SUN will support you through the process.  They are well known in the community, having helped hundreds of households in DC install solar systems.  They have significant clout with the DC government and with solar installers.

 

3) Neighbors can support each other through the process as well.  This can not only be helpful when going through the installation process, but say for example 5 neighbors determine that they would like to upgrade the windows in their homes to complement their new solar system….theycan band together to look for a contractor that can install the windows and maybe secure their own bulk purchase discount.  This would be done independently of DC-SUN since DC-SUN concentrates solely on solar.

What incentives are available?

Over its 20-25 year lifetime, a system will generate thousands of dollars worth of electricity.  The value depends on the size, and since it’s not something you receive up front, it’s hard to talk about in regard to financing a system, but know that it’s thousands of dollars.

1)

1:1 net metering.  What does this mean?  Once your system is installed, it is tied into the grid.  Whenever you generate more electricity than you produce, your electricity flows through your meter, out to the grid and powers someone else’s house or business.  You get a credit for every kWH (kilowatt-hour) that your system provides to the grid.  When your system produces less electricity than you need, you consume electricity from the grid and are charged for it.  At the end of the month PEPCO figures out how much you sent to the grid and how much you took from it, and only charges you for the difference between what you took from PEPCO and what you gave them.  Sounds obvious, but in some jurisdictions this is NOT the case.  Fortunately in ours it is.
On a related note, a solar installer cannot install a system that provides more electricity than you will consume over a year.  This will likely not be an issue for most people due to the limited size of DC roofs.

2)

DC Grant. This is on hold.  Up until the end of last fiscal year DC was allowing people to continue to sign up for the waiting list for a relatively small grant for homeowners who install solar systems.  It MAY be resurrected in the spring, but don’t count on it in your calculations.

3)

Federal Tax Credit.  You receive 30% of the total cost of the system when you do next year’s taxes.  You still have to pay up front for the system but when you file your tax return, you will receive a 30% CREDIT (not a deduction) from the federal government.  It is not available for rental houses, but if you have a rental you may have other incentives at your disposal like accelerated depreciation or other things that I know nothing about.

4)

The most complicated incentive is the SREC or Solar Renewable Energy Credit.  The easiest way of thinking about this is whenever you generate solar electricity from your system, you are also generating an abstract “green value” of your electricity.  Through law and regulation, this abstract concept becomes worth something called an SREC.  You can either sign your rights away to all theSRECs your system will ever generate and get a cash payment from your installer (which ends up being a discount applied against the cost of your system).  Right now that up-front one-time cash payment is a little over $1200/kW installed. 

OR, you can keep your SRECs and sell them as they accrue through brokers like SRECtrade.com or solsystems.com.   In the long run it is generally believed that this will get you more money, but is riskier than just taking an up front payment.  Every time your system produces 1,000 kWH of electricity, you get one SREC.

The longer version of the SREC story is that PEPCO is required by DC law to put a certain amount of solar PV production on the grid.  For whatever reason they don’t actually do this, so instead they can buy SRECs tosatisify the solar requirement.  Due to laws/regulations, the value of an SREC should hold steady until 2016, after which it will likely drop in value.

5)

Bulk purchase discount as discussed above.

Example for a 3 KW system:  price before incentives: $13,500
Bulk Purchase discount (20%)  - $2700
SREC upfront payment ($1200/kW):  -3750
Initial upfront cost: $7,505
Federal tax credit (30% of system cost):  -3240

Estimated energy savings in one year $-480

Total cost (after one year): $3,330

 

Other issues:

FUNDING FOR DC-SUN.  Anya was very up front about this – for the first time, for every signed contract the chosen installer will donate $500 to DC-SUN.  This will provide a funding stream for people from DC-SUN to be able to take the time to continue to go to community meetings to promote solar bulk purchases and other solar projects in DC.

 

Community Solar.  A law was recently passed in DC that allows one solar project to provide electricity to multiple consumers in DC.  For example, if you installed a solar system on your house but have 2 units inside the house, you will soon be able to share the electricity between the units.  Or, if you have a condo with a shared roof, some or all of the condo owners could install solar on their roof and share the electricity that the system generates (basically each member would get a credit on their PEPCO bill reflecting the power that the panels have generated).  Or, if you lived in an apartment and you wanted to buy into a large system installed on top of a warehouse, the new legislation will allow you to do so.  This is not quite ready to be implemented yet and doesn’t apply to our bulk purchase since the law was just passed last month, but it will be coming soon.

 

Green roofs.  If you want to go all out and install a green roof and a solar system on your house, you may want to go it alone.  There is one installer in the area that does both.  A green roof is essentially an upgraded roof that has soil and plants on it; it provides added insulation for your house and manages rainwater in a controlled fashion, decreasing pollution.  It is possible to install a green roof and solar panels but it is more difficult and costly.

Electrical systems. Some people expressed concern about the age of their wiring and panel boxes in their house and whether they could handle installation of a solar system. This should not be an issue.  In the worst case scenario someone with a very old electrical panel may need to spend around $500 to upgrade their panel.

Leasing/Financing.  Some installers will offer leases where they own the system, they get all the SRECs, and you buy your electricity from them.  This is probably cheaper than buying from PEPCO but not as financially beneficial in the long run as buying a system outright.  Some installers will offer financing and that can be something the selection committee uses when weighing companies bid’s against each other.

Roof condition.  If you need a new roof, you have two options:  1) you can have a new roof installed prior to solar PV installation; in which case you could still participate in the bulk purchase process or 2) you can go it alone with the one contrator in the DC area (Maggioroofing) who offers a solar integrated roof.  This can be expensive, but offers the benefit of one receipt showing the installation of a solar system integrated into your new roof; supposedly it is completely legal to receive the 30% federal tax rebate on the entire cost of the roof + solar since it’s an integrated system.  If you need a new roof and are interested in the integrated solar roof, it may be worth at least getting a quote from Maggio.

 

What’s next?

We already have 20 households signed up, so in early November DC-SUN will be issuing an RFP, with a goal for a selection committee to form and meet before Thanksgiving.  The goal is then to have the company selected and pricing information be available by the end of November.  Sign up for the process would be open until the end of December and installation would continue until the installer is done with all homes that have signed up.  Those homeowners who sign up earliest will be offered installation first.

 

If you’re ready to sign up, go to:

 

bitly.com/ward5bulkpurchase

 

For more information, check out: https://sites.google.com/site/dcsolarunitedneighborhoods/

You can join their google group which has tons of postings from people in DC who may have already dealt with the issue you want to know more about

If you can’t find answers to your questions there, contactward5@dcsun.org