We love party discussions about solar wind turbines and photovoltaic (PV) panels for generating electricity, especially for governments and local area projects that need to be voted on. There are so many wrong ways of building such systems. If it’s worth installing one, you have to do a few things before that will save you a small fortune.
How do you save money on a renewable energy system? First and foremost, you have to decrease electrical usage in your home or business. You can change your lifestyle and habit a little, i.e. turning the Air Conditioning down a little bit, turning lights off when you don’t need them, etc. Most of these, people do already, and if you don’t, you’re really wasting a great deal of money. But let’s say you already do all of these or you just don’t want to change your lifestyle…what else can you do?
You can buy higher efficiency appliances, i.e. electric water heater, air conditioners, washer, dryer, etc. Yes, these are more expensive, but they’ll save you money in the long run and more expensive equipment tends to be sturdier and last longer. As a reasonable person, I personally wouldn’t buy a new appliance for better efficiency when I have a good one working right now, but when that appliance does break, buy the better one and consider it a money saving investment vice a replacement.
What you can do right now that’s worth every penny before you purchase a renewable energy system is to change your incandescent bulbs to compact fluorescent bulbs (CFLs) or LEDs (available right now and more options coming out soon).
We’re saying all of this because when a renewable energy installer comes to your business or home, they’re going to check your electric bill. They take a look at how much energy you are using and build a system to accommodate for that usage. As of 2007, the US Department of Energy states that the average U.S. home is using over 936 kWh (kilo-watt hours) per month. Depending on your location and efficiency of your panels, it gets kind of tricky figuring out the cost. There’s no simple formula, but your average home system is going to cost around $50-$60,000 for a solar PV system, depending on options.
In a previous article (Renewable Energy … AC vs DC) we spoke about the installation cost of a solar PV system is about $4/watt and within the next decade we hope the price will get down to $4/watt with installation for a small project, i.e. home. So let’s consider an incandescent bulb example. You currently have just one 100-watt bulb. Multiply that by $4/watt and that means it’ll cost you $400 to run that one bulb! Now you may say that you don’t constantly run that bulb all of the time, but the sun isn’t shining 100% of the time either.
Now let’s go to a CFL, same light output, uses about 24 watts, which brings the price down to $96. And the LED example is even better since it uses only 13 watts, which brings the cost down to $52. Just buy switching from an incandescent to an LED bulb you can save $348 or more than 87% of the cost! Just go around your house or business and count up your lights. Just by switching to CFLs and LEDs instead of incandescent bulbs, you will probably save $10,000 on your system, if not more.
If you have an electric water heater, install a solar water heater to augment your water heating system. Even though that’ll cost you $2-$8,000 (depending on your climate location and usage), it can save you $10,000 on your renewable energy system.
If you cut down on your energy consumption you can drastically cut the cost of a renewable energy system, since you need a smaller system. And don’t forget about the maintenance. Solar PV panels degrade over time, wind turbines break their blades, and the most important thing people don’t account for is the power inverter. A power inverter costs around $0.50/watt and goes bad about every 10-15 years, so you’ll have to shell out $5,000 every 10-15 years to replace it. Caveat Emptor! If you cut down your power consumption with more efficient systems, you can save yourself thousands of dollars.
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