SOLAR SAVER
For Steve, being green is all about the money
STEVE BUZALKO ISN’T EXACTLY what you’d call a “green” kind of guy. He works with wood for a living, meaning his job involves a nasty little thing called “deforestation” that’s bemoaned by environmentalists the world over.
“I am a cabinetmaker by trade, so we must cut a few trees to make things. They grow back,” Steve deadpans to me. “[But] I do believe in doing the right thing and helping people.”
He is, however, interested in another kind of green—the kind that pads your wallet. That’s why the fifty-four-year-old craftsman decided to install a solar system at his Pottsville, Pennsylvania, home back in April 2010.
Steve built his two-thousand-square-foot raised ranch himself, and he shares it with his wife, who is a high school guidance counselor in Schuylkill County. The upper floor of the home is residential, while the bottom floor houses the workshop of Buzalko Woodworking. When I spoke to him, he was working on a library made of cherry wood for a nearby Hindu temple.
Having a workshop onsite means two electric meters on the property, one residential and one commercial.
As a cabinetmaker with twenty-seven years of experience, Steve wasn’t used to researching the best prices for solar photovoltaic (PV) systems in his normal line of work. But he got some guidance from a weekly newspaper that had an article on alternative energy for farmers—published, ironically enough, deep in the heart of neighboring Amish country—and soon found three companies that could install the system he was interested in.
“While [I was] on the phone with each company, they looked at my house on Bing maps and determined [it] would be a good candidate for solar because of its southern exposure,” Steve recalled. “The lowest price was [from] the only commercial electrical contractor. The others were newly formed solar [installation] companies. This particular company sent an electrical engineer, the others sent salesmen. That also helped me to choose them.”
Based on his energy needs and his electric bill, Steve decided on a 10-kilowatt (kW) solar system consisting of fifty roof-mounted 200-watt panels at a cost of $55,000.
He paid for it up front using a home equity loan, and then received a $19,500 grant through Pennsylvania’s Sunshine Program, plus a $16,500 federal tax credit on his 2010 taxes. His final out-of-pocket cost for the system was $19,000, and he paid off the home equity loan in two years.
The 10-kW solar system now provides for all of the Buzalkos’ residential energy needs, while Steve’s commercial work space is still powered by the local utility company.
Before the solar system, Steve’s residential electric bill was around $120 a month. (Recent rate increases would have bumped that up to $180–$220 a month.)
Today, though, he generates enough of his own energy to pay zero, zip, nada each month to the utility company for his residential electric needs—except a customer service fee of around $8 a month. The junk fee allows him to have his system hooked up to the grid so he can sell the power he generates down the line.
“What I produce when the sun shines I use,” Steve says. “Any excess electric will feed back into the grid for others. During those times of excess, my electric meter spins backwards. During times of no sun, I take from the grid and the meter spins forwards.”
Each 1,000 kilowatt hours of energy his system produces above and beyond what he uses is equal to one credit, and Steve produces about twelve credits a year. Those credits are reported to an aggregator (he chose his installer) who charges a flat fee of $10 per credit to accumulate and sell them to large electric generative companies.
When Steve first installed the solar system in early 2010, each credit sold for between $300 and $350. Add that to the minimum $120 he saves each month on electric, and he was trending toward a return on his $19,000 investment in 4.7 years. (The magic number for a payback period at today’s low interest rates is ten years.)
But now, with more people installing solar and selling excess energy on the open market, the increased supply of credits means each one only commands about $20 to $30 in Steve’s area. The way things are going now, Steve figures he won’t make his money back until 2016 or 2017. But you have to remember that he has no residential power bill.
Still, return on investment wasn’t exactly the foremost thing on his mind when he decided to go solar.
“[My wife and I] are looking at retirement and are motivated by one less bill to pay and being more self-sufficient,” Steve tells me. “We have our own well and septic. No bills for water or sewer. As hobbies, [we] grow vegetables and jar them. We keep chickens, and I make my own wine and beer. It all sounds like a Mother Earth [thing], but it’s not. We enjoy the modern world. I do not consider myself a ‘greenie.’ I just believe in doing no harm and being responsible. Nothing more.
“I am happy I bought the system and would recommend anyone with the means to do it. Just do your homework, and get all the grants and credit available to you.”
Steve adds that you should get at least three quotes for your system and ask a lot of questions of potential contractors. The questions he asked included the following:
As for me, I believe solar energy is a huge part of what we need to be about as a nation. My wife and I have a vacation place at the beach in Florida that is a near net zero energy home. We’ve put in the compact fluorescent lightbulbs, the efficient HVAC, and even a solar system.
Over the course of a year, we sell more power than we buy from the power company in Florida, just like Steve. So we have no utility bills. And that’s saying something because even though we’re not there all the time, we have to run the air conditioner all year round—otherwise we’ll have mold growing in the high-humidity climate.
To give you an example, a few months ago our power bill at the beach was $4.15. The bill after that was negative $26—the power company owed me instead of the other way around because of what I generated and sold down the line.
Consider the following when you want to begin shopping for a home solar system.
Get ready for your quote.
Consider a lease.
Explore your alternatives.
Go green to get more green at resale.