As a member of the Union of Concerned Scientists, I recieved an email regarding the Solar to Market Initiative provided by the Massachusetts Technology Collaborative's (MTC) Renewable Energy Trust. The email, available
here, says that new incentives can reduce the cost of a solar panel system in Massachusetts down to about $7,500. The original costs are estimated to be about $20,000.
So how does this work? Well, you pay $7,500 and get a system installed on your roof. Any energy that's being produced by the system can be used by your household. Any energy not needed is sold back to the utility. The system will actually pay for itself in savings!
How good an investment is this, though? Well, suppose your average monthly electric bill is $100, and the system provides 30% of your annual power needs. That's a savings of $360 every year. Divide that into the cost of the system, and ta da, it will take 20 years for the system to pay for itself. Hmm, the bank will probably expect to be paid off before then, so I don't suppose we can just take the money we were going to give to the electric utility and give it to the bank to pay off the loan for the system. But after those 20 years are over, we can definitely enjoy real "savings", since the system has paid for itself, right?
Well, that assumes quite a bit. First of all, we'd have to assume you're still living in the same place. Second, your glass solar panels would have to be in good working order, and the current lifespan of solar panels is only 10 years. And third, you'd have to assume that your annual energy consumption remains the same. And won't better solar panels be available by then anyway?
Hey, this doesn't look like such a good idea anymore. What's MTC thinking? This sounds more like the "investment" I made in my computer. At least my computer provides services that are worth more than what I originally paid for it, right? And for that reason people buy computers. They buy thousands and thousands of them every year. That money goes to computer manufacturers who, in turn, are able to provide better and cheaper computers to consumers. Solar power companies don't have that benefit. People don't buy solar panels, so there is no money to make better, cheaper panels. There is no demand to increase competition among manufacturers. This deal by MTC is aimed at two things: helping the environment by getting you to use renewable energy, and encouraging you to give business to solar power companies, whose products are overpriced for today's market.
So, what's my advice? If you have the money - do your part both for the
environment and for the future of renewable energy - get a solar panel
system for your home or business. If you don't have the money and were
looking to generate savings, give it some time and start putting money
aside. By the time
you save up half the upfront cost, the systems will be cheaper, will produce more electricity, and will thus take a much shorter time to pay for itself and start generating real savings.