More than 1,000 Coloradans so far have written big checks to take advantage of installing subsidized solar-electric systems.
The major investment required is undeniable. So too are the resulting benefits.
Typical out-of-pocket cost: $10,000.
Typical annual power savings: $500.
Typical response: Pleasure at watching sunlit solar panels work their magic on utility bills by sending extra power back to the grid.
“It is really fun to go out there and watch the electric meter spin backwards, let me tell you,” said Boulder resident Randy Moore.
Moore, known in drama circles for his acting with the Denver Center Theatre Company, is gaining more recognition from the rows of solar panels mounted on his roof and in his backyard.
“People see them, and they want to know about them, and then they want to do it,” he said.
Residential solar power began taking off last year after Xcel Energy offered a rebate program to help the utility comply with Colorado’s voter-approved renewable-energy standard.
The rebates cover roughly half or more of the cost for purchasing and installing photovoltaic, or PV, panels. The systems use silicon wafers or other materials to convert sunlight to electricity.
Federal tax credits reduce costs by an additional 30 percent, up to $2,000.
The result: household systems priced at a range of $18,000 to $45,000, depending on size, can be whittled to an out-of-pocket expense of $7,000 to $16,000 after rebates and tax credits.
Typical payback periods are estimated at about 15 years if electricity prices rise by 5 percent a year — considered a conservative increase by some analysts.
Homeowners and businesses offset at least a portion of their electricity consumption with the power produced by PV panels. If they generate more power than they use over a 12-month period, Xcel writes them a check for the difference.
Xcel issued its 1,000th solar installation rebate late last month. That represents less than 1 percent of the utility’s Colorado customers.
Critics of subsidized renewable energy say it is unfair for a small number of homeowners and businesses to benefit from discounted systems while all of the utility’s ratepayers share the proportional costs of providing rebates.
Yet Xcel officials maintain that all customers benefit because solar systems delay the need to build expensive power plants and reduce prospective future taxes on carbon emissions from fossil-fuel power.
Boulder-based Namaste Solar Electric, one of the state’s largest solar installers, has grown from a 2004 startup with three employees to 28 workers.
Blake Jones, president of the firm, declined to release revenues but said they have doubled over the past year as the firm installed 340 PV systems.
Jones recently surveyed members of the Colorado Solar Energy Industries Association and calculated that the sector has created 660 jobs since 2004 and will more than double that total next year. Industry revenue in Colorado is estimated at $125 million this year.
Although an industry booster, Jones acknowledges that PV systems aren’t for everybody: people who can’t afford the relatively high initial expense, owners of homes with limited southern exposure and households that use less than 200 kilowatt-hours of electricity per month. The average monthly consumption for Xcel residential customers is 625 kilowatt- hours.
Jim Martin, a business consultant in Boulder, did the math and decided last year that putting in a larger-than-average PV system, producing 10 kilowatts, made sense.
Rebates and tax credits pared the initial cost of $70,000 down to $28,000.
“Literally, the whole top of our house is covered with panels,” he said. The generated power, on average, covers the home’s total consumption.
Martin estimates that with modest annual increases in electricity costs, the system will pay itself off in 11 or 12 years.
While some PV homeowners are motivated by environmental reasons, that was a secondary consideration to Martin.
“I basically get free electricity for life,” he said. “It doesn’t hurt my feelings not to be sending a lot of money each month to Xcel.”
Steve Raabe: 303-954-1948 or sraabe@denverpost.com
Solar by the numbers
3.5 kilowatts – Average size of residential photovoltaic system
$28,000 – Retail price
$15,750 – Rebate
$2,000 – Tax credit
$10,250 – Net cost
5,100 kilowatt-hours – Annual production
$510 – Annual savings at 10 cents/kwh
14-15 years – Payback period
* *Assuming 5 percent annual increase in electric costs
