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How to Calculate the Size of Your Solar System

One of the more appealing aspects of going solar is the notion that a solar system will automatically replace your entire electric bill. However, having your own energy supply doesn’t guarantee that it will generate enough power to cover 100% of your consumption. These calculations may seem complicated, so in this article we’ll explain how to calculate the size of your solar system based on your actual consumption.

Understanding the difference between your electricity needs and the capabilities of your system can prepare you for the reality of post-solar electric bills. Having a personal energy source (the solar system) does not mean that it is an unlimited supply of energy, but having the right system size — and understanding your energy consumption — can help you take steps to optimize your system’s efficiency.

A solar system is sized according to your past 12-month energy consumption plus the solar capacity of your home.

It’s important to be accurate in your energy consumption calculations. Without getting too in-depth, the easiest way is to contact your utility company and request your usage data for the past 2-3 years. One year is often enough, but if your energy needs have changed, it’s not a bad idea to go back in time a little bit more to understand where your energy expenditures go. Getting an average is the only way to accurately determine actual consumption, since a solar system’s energy output and your own consumption will vary month to month. Peak times could be summer when the A/C is running nonstop; or winter, when days are shorter, the lights are on more, and you heat your home with electricity. In ideal weather conditions (sunny yet pleasantly warm days in early fall, for example), you may end up overproducing. But in blazing hot July or dark and cold January, your solar system may only be able to cover a portion of your electricity consumption.

The offset (how much electricity your system can produce versus how much you actually use) is calculated on an annual basis (as an average of all months and all consumption rates). If you divide your total yearly solar production by your total yearly consumption, you may not come close to 100% offset depending on the size and efficiency of your system, and the home’s location in relation to the sun.

The good news is that photovoltaic systems are becoming more and more efficient, and with a few considerations you may be able to achieve optimal offset.

Calculating Your Electricity Consumption 

Call your electric company to get your usage history for the past 12 months, and calculate your average monthly consumption. You can also access this information if you keep your bills or pay your bills online. Again, keep in mind that energy use fluctuates wildly throughout the year, which is why an average is essential.

What you want to look for is kilowatt hours (kWh). Add up the kWhs for all 12 months. Divide that number by 12 to get an average. Then, divide the monthly consumption by 12 to arrive at your daily kWh usage.

To get even more detailed — and this is a great opportunity to accurately assess where you could be saving electricity — add up the kWhs of anything that uses electricity. Your electric bill doesn’t itemize the energy draw of heating, cooling, lights, kitchen appliances, washer/dryers, hair dryers, power tools, computers, and other devices so it’s great to know how much certain devices use so you can eliminate them or upgrade to more efficient units.

How do you arrive at kWh energy usage of your appliances and electronics? This is a labor-intensive assessment that’s generally not needed for calculating your solar system size; but it’s a great way to audit your home’s actual energy needs.

  1. Calculate how many watts each device uses every day
  2. Convert the watts to kilowatts (1,000 watts = one kilowatt)
  3. Multiply the daily kWh by 30 to determine the monthly usage

For example:

  • One 20W fluorescent garage light on for 2 hours per day = 40 W/hrs
  • One 50W ceiling fan on for 24 hours per day = 1200 W/hrs or 1.2k Wh
  • One 70W LCD TV on 6 hours per day = 420 W/hrs
  • One 50W laptop on 8 hours per day = 400 W/hrs
  • One 10W Wi-Fi router on 24 hours per day = 240 W/hrs
  • One 200W refrigerator on 24 hours per day = 4800 W/hrs or 4.8 kWh

The total for these six devices is 7.1 kWh per day. Monthly, that adds up to 213 kWh for just these six devices. 

Alternatively, you can calculate the energy usage for particular devices by installing an electricity usage monitor between the appliance and the outlet, and leaving it in place for a week or even a month to get accurate numbers.

For the sake of comparison, the average home in the USA uses about 900 kWh per month which breaks down to 30 kWh daily, or 1.25 kWh hourly.

Keep in mind that solar panels don’t produce energy at night, and this is an important consideration when calculating the optimal system size for your home. This is where net metering comes in to balance out the difference between your system’s production capacity and your consumption. During the day, your system may overproduce electricity, sending it back to the grid and causing your meter to essentially run backward (we all love this!); at night, or on cloudy/rainy days, the panels are not producing energy, so energy is pulled from the grid. Your electric bill will reflect the difference between the energy you put into the grid and the energy you pull from the grid.

Determining Insolation

Before you look into the capacity of solar systems, you need to understand the insolation of your home. Insolation is not the same as insulation. Insolation is the average number of hours that the sun produces peak (most intense and direct) sunlight at your location. Insolation varies according to season, latitude, atmospheric transparency, the slope of the ground and obstructions such as trees. These factors affect how much solar energy actually reaches your solar array. A great resource for determining your location’s insolation is the National Renewable Energy Lab Solar Irradiance map. Central Texas, for example, enjoys 5-5.25 hours of insolation per day while upstate New York is less than 4 hours per day. (There’s plenty of more fascinating solar- and energy-related information on the NREL site).

Not surprisingly, insolation affects temperature (the higher the insolation, the higher the average temperatures); so areas receiving high insolation may also consume more energy in maintaining a comfortable home.

Calculating the Size of Your Solar System

Now that you know what your average daily kWh consumption is, you can calculate the size of your solar system.

  1. Divide your peak insolation by your daily kWh energy requirement to determine the daily kW output you need from your system.

For example: 5.25 hours of insolation ÷ 1.25 kWh daily consumption = 4.2 kWh output requirement daily; 126 kWh monthly;  or 1,512 kWh (or 15,120 kW) annually. The number you’re going to use in the next step is the kW number (in this example, 15,120).

  1. Divide the kW output by a solar panel’s efficiency by 365 and the location’s insolation, and multiply by a 1.15 efficiency factor to arrive at the system size needed for your system to generate the required energy year-round.

For example: (15,120 ÷ 365 days ÷ 5.25 insolation) x 1.15 efficiency factor = 9.07 kW DC solar array size

Site Considerations

Once you know the capacity of the system, the next question is, where will you put the panels, and can your roof accommodate them all? A roof mounted system is the simplest and most cost-effective solution. However, not all roofs face south, and not all are big enough to accommodate the required number of panels.

A small, shaded, or unusually shaped roof will affect solar panel size, quantities, and efficiency. If you have a large usable roof area, you could sacrifice some efficiency and choose more, larger panels to achieve your target energy output. But if your roof isn’t ideal; if the usable area is limited, the roof pitch doesn’t face south, or the home is in partial shade, going with fewer small, high-efficiency panels will give you the greatest possible output.

If you have the land, a ground-mounted system may be an option. Or, solar roof shingles can be a great solution if your roof needs replacing and you can’t accommodate enough roof-mounted panels.

Save Money with High-Efficiency Panels

Not all solar panels are created equal. Photovoltaic (PV) panels, which are the type most commonly used in homes, range between 150-370 watts of output each. This capacity depends on the size of the panel, the cell technology, as well as its efficiency (how well a panel converts sunlight into electricity). The more efficient the panels, the more electricity they can produce, and the fewer you will need to achieve the energy output you need; while more costly, high-efficiency panels will give you a better ROI than low-efficiency panels.

Because there’s so much variety in solar system efficiency and quality, your best bet is to contact us for an onsite consultation to discuss your needs and which type of system is best for you.

 

Ways That the Government Can Help You Go Solar in Texas

Take advantage of tax credits and go solar!

Solar power is gaining a serious foothold in the American psyche as a viable alternative to dirty energy from oil, coal-fired electric plants and hydroelectric plants that damage fragile river ecosystems. But… is solar actually affordable for the average homeowner? The great news is that the cost of solar is going down every year, and you can take advantage of several ways that the government can help you go solar.

Governments offer solar tax breaks but if those aren’t available, some utilities offer financial incentives to make solar power more accessible for the homeowner. The estimated savings as a result of these incentives is anywhere from 26 to 50 percent on the cost of the panels.

The Catch

You have to own the system in order to take full advantage of government incentives. If you purchase your system, you are the one who gets the tax credits, rebates, and other incentives. However, if you lease your solar system, the third-party owner of the system receives the incentives.

This doesn’t mean that you don’t benefit from solar if you opt for a lease. A solar lease can make sense if:

  • You want to use electricity generated from a renewable source, rather than relying solely on the grid
  • You want to start cutting your energy costs right away
  • You want guaranteed performance without dealing with maintenance or repairs
  • You don’t qualify for federal or state investment tax credits for a solar system purchase

The biggest advantage of solar leases is that you don’t have to pay back 26% of the loan by month 18 (the tax credit) like you do with a traditional solar loan. This is great if you don’t qualify for the tax credit. With a traditional loan, even if you don’t qualify for the tax credit you still have to pay the amount of that tax credit back into the loan by month 18 or your payment goes up for the rest of the loan life, throwing off the savings aspect of going solar! With a lease, you don’t have to do that so the payment stays the same.

However, the greatest savings ultimately come from purchasing a solar system because you are the one who benefits from the government incentives, as well as incentives from utilities.

Government Solar Incentives for Homeowners 

Government incentives such as tax credits add up and can put a significant dent into the cost of your solar system.

Federal Solar Tax Credits

The federal government offers a solar tax credit (also known as an investment tax credit or ITC) that lets you deduct a portion of your solar costs from your federal taxes. Originally established by the Energy Policy Act of 2005, this program was initially slated to expire just two years later. But its popularity led Congress to extend the expiration date several times; the current ITC is available through 2021, although the original 30 percent tax credit has now dropped to 26 percent, and will drop again to 22 percent in 2021. There will be no federal credit for residential solar installations after the program expires at the end of 2021. If it is renewed as it has been in the past, and based on the trend of this program, the tax benefits will likely continue to drop.

Your eligibility to receive the tax credit depends on your taxable income and tax liability. Please consult a tax professional to confirm your eligibility and if you’re eligible, use IRS form 5695 to receive your ITC.

What this means for you: get it while you can. On average, solar customers save approximately $9,000 off the cost of going solar.

Texas State Tax Credits 

Texas does not offer a tax credit or property tax rebates for going solar (flood your representatives with calls and emails to get them onboard with solar).

What this means for you: flood your representatives with calls and emails to encourage them to offer solar tax credits!

Why Stop There? Take Advantage of Utility Solar Incentives

Some local utilities offer solar incentives that may involve solar rebates or net metering (selling your overproduced energy back to the grid, which is a great incentive in sunny Texas).

Here’s a list of Texas utilities currently offering residential solar incentives. If your utility is not on the list, it means they don’t offer solar rebates, or those incentives haven’t been published as of this writing. However, most utilities offer some types of incentives for energy-saving home improvements. Please contact your utility provider for additional information.

Texas utilities offering rebates for installing solar systems, and/or net metering:

  • American Electric Power (AEP)
  • Austin Energy
  • CoServ Electric
  • CPS Energy
  • Denton Municipal Electric
  • Farmers Electric Cooperative
  • Garland Power & Light
  • Guadalupe Valley Electric Cooperative (GVEC)
  • Heart of Texas Electric Cooperative
  • HILCO Electric Cooperative
  • Mid-South Synergy
  • New Braunfels Utility (NBU)
  • Oncor Electric Delivery

What this means for you: take advantage of incentives and contact your utility to encourage them toward adopting a solar rebate program.

Okay, So What’s the Bottom Line? 

As of March 2020, the average cost to install a residential solar system is $13,850. Based on this average, here’s what a solar system in Texas could actually cost you if you deduct your 26 percent Federal ITC: $10,249.

  • Save $2,161 on a system that costs $8,310 to install after local rebates (with the ITC applied, the cost would drop to $6,149)
  • Save $7,202 on a system that costs $27,700 after local rebates (with the ITC applied, the cost would drop to $20,498)

With net metering, the savings will vary depending on your current energy bill, how much your system generates, and your utility’s rate of buyback. But, to give you a rough idea, here are a few examples:

  • If your monthly electric bill is around $133 (the Texas average) and you use 1174 kWh/month (about 11 cents per kWh), you could save over $91 per month, or nearly $1100 annually.

Good financing options as well as solar company rebates can knock your cost down even more. So to answer the question, “is solar affordable”… the answer is a resounding yes. The Federal ITC itself is reason enough; not to mention the increased value of your home after you’ve installed a solar system!

 

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