Solar Air Heating Unit on Home North of Kansas City

This product is  a supplemental space heater powered by solar energy.  It is mounted vertically on the south wall of your home.  Air is drawn from inside the room through the bottom of the collector and blown out through a duct in the top.  The unit is self-powered and no electrical hook-up is required. 

The smaller unit is about 4’ by 5' and will heat rooms up to 300 square feet. Installed cost is $2,300.  The larger unit is about 4’ by 8’ and will heat up to 700 square feet of living space.  Before tax credits, the full installed cost is $2,900.  Contact us at 913-495-9434 for more information and check out the story about a Missouri family that owns one.

Posty Cards is one of the first businesses to take advantage of Kansas City Power & Light’s new solar rebate program of $2 per watt. The rebate offsets  the  cost by nearly 25%!  In addition, the company received a federal grant of 30% and accelerated depreciation.

“With our new solar PV array now generating over 11% of our total power, we’ve taken a huge step toward our goal of offering customers the most sustainably produced products and services in our industry,”  says Erick Jessee, President.

The array consists of 198 Sharp 224 Watt solar panels (all made in the USA) for a total of 44.3 kilowatts. It is tied to the grid and offsets 11% of total electricity usage.

The array features six SMA 7,000 Watt inverters  to convert the DC electricity generated by the panels into usable AC electricity for the facility.  By using special clamps that attach to the seams of the metal roof, only one roof penetration was required in the installation of the panels.

Property Accessed Clean Energy, or PACE, is a way for homeowners and businesses to finance renewable energy and energy efficiency upgrades through an established bond program at the City, County or State level.  The low-interest loans/bonds are typically easier to obtain and cheaper than going to a bank on your own.  The PACE loans get paid back as a tax assessment.  Most programs allow for building owners to opt for a 20- year assessment on their property taxes.  If the home or business is sold, the new owner continues the payments.
 
Several states including Missouri have jumped on the PACE band wagon.  Governor Nixon signed the PACE legislation on July 12th enabling Cities and Counties to establish special Clean Energy Development Boards with the authority to issue the low-interest bonds.  Twenty three other states as well as several cities and counties have recognized the immediate and long-term benefits of providing for energy upgrades upfront.  By helping to spread out the initial investment communities see reduced energy consumption, economic influx, job creation as well as decreases in carbon and other pollutants.  Building owners are able to improve their property and the occupants in homes and businesses are provided better living spaces.  The program requires that the monthly energy savings must be more than the assessment, which reduces the cost of ownership immediately thereby improving the cash flow of participants.
 
Sounds like a win- win situation all around right? 

Unfortunately the PACE program has hit a snag.  Federally backed mortgage companies Fannie Mae and Freddie Mac have argued that PACE programs put the security interest of mortgage companies at risk as the loans take on a first or senior to the mortgage.  All is not lost however; The Federal Housing Financing Agency, which oversees Fannie May & Freddie Mac, says they are working to resolve the issue and legislation has been introduced by Congressmen Michael Thompson to protect PACE (H.R. 5766).  Many see the issue as a matter of a states right to utilize assessment districts.  You can learn more about the fight for PACE and what you can do to help to ensure that it gets back on track by visiting:  http://pacenow.org  and http://votesolar.org

Business leaders, including The Energy Savings Store and representatives from 17 counties and 15 cities attended a recent training sponsored by Renew Missouri to learn more about how to establish a PACE program in their communities.  Many are moving ahead laying the ground work to establish their Clean Energy Development Boards so they will be ready to once the mortgage issue is resolved.  Contact your local municipality or county government and ask if they are planning to establish a PACE program.

Solar became the solution for Ray and Kathy Baisch after seeing their electric rates increase by over 30% in the last three years.  Located in Lee’s Summit, Missouri, the Baisch’s had been considering a solar-powered electric system for years.  The couple got serious about making the investment when they learned that KCP&L was offering a new solar rebate.  The new rebate was a result of Proposition C that Missourians overwhelmingly passed in 2008 (read more here). The $2/watt rebate covers about 25% of the price of a solar system.  Combining this incentive with the 30% Federal tax credit - and nearly half of the cost is covered.

After meeting with a Renewable Energy Consultant at The Energy Savings Store, the couple decided to purchase a 4.14 KW system.  The solar energy system will offset nearly 90% of their energy usage.  The system was placed in service the first week of January. “The Baisch’s may be the first rebate recipients in the state,”  said Roland Maliwat, Manager of Sustainability at KCP&L.  “We supported Prop C and are very happy to see it result in solar installations for our customers.”

Net Metering
Not only are Ray and Kathy excited about being the first KCP&L customers to receive the rebate, they are also eagerly awaiting the possibility of watching their electric meter spin backwards when their system is producing more than they need.  In addition to the rebate the utility company will allow the couple to "net meter."  With "net metering" the Baisch’s will be able to accumulate credits for months that their system produces more than they need.  When they have months that they use more electricity than their system produces they will be able to use the accumulated credits from the prior month.

Over the course of the year the Baisch’s will end up paying very little on their electric bills. They are looking forward to a day in the near future where the energy savings will have paid for the cost of the system - after that Ray and Kathy can expect decades of free electricity.

We are going to see the first ever utility rebates for solar photovoltaic (PV) installations on Missouri homes and businesses starting January 1st, 2010.

These new rebates, in combination with the federal tax credit, can reduce the cost of a system by over 50%.  Instead of a 20 year payback, many Missourians can now see a 10 year payoff of their initial investment using conservative assumptions! Wow.

It's not always an easy process to identify what rebates and credits you might be eligible for, and then wade through the paperwork needed to file for them. Rest assured that we want our clients to every financial incentive possible. Our staff have become experts on this and we'll walk you through every step of the process.

Here is a summary of the incentives available for solar PV in Missouri:

• $2.00 per watt solar rebate (capped at $50,000) for KCP&L and Ameren customers in Missouri only starting January 1, 2010
• 30% federal tax credit
• Net metering – you can "store" excess solar energy on the grid at any time during the billing cycle, and receive a credit for any net excess at the end of the month.

These incentives apply to both residential and commercial customers.  Businesses can take advantage of even more perks:

• The 30% federal tax credit can be applied for as a grant in 2010
• The 5-year accelerated depreciation is expected to be extended into 2010

Here is an example of how incentives can lower the cost of a residential solar PV system. Let’s assume you are buying a small 1kW solar array (about 6 panels):

Proposition C is designed to require that a certain percent (15% by 2021) of our utility power come from renewable sources, like wind and solar.  This is called a Renewable Portfolio Standard (RPS).   Investor owned utilities (KCP&L and Ameren) can choose to build wind and solar farms or they can purchase Renewable Energy Credits (RECs) from individuals that install solar and wind systems on their homes or businesses.  The utility companies can then use those credits toward compliance with the RPS.

The will create a market that will drive pricing for RECs in Missouri.  Your utility may pay an up-front lump sum for RECs from smaller systems, or may buy the RECs as the energy is produced over the life of the equipment for larger systems.  This market will be established once the Missouri Public Service Commission (PSC) finishes the rulemaking process.  The PSC will be finalizing the draft rule within the next few weeks.  After a 30 day comment period and a public hearing, the Commissioners will produce a final rule.

So what do you do if you want to install solar on your home or business and take advantage of the new programs? Talk to us. We make this process as easy as possible and we make sure our customers get every financial incentive possible.  You may also want to check the Missouri Solar Energy Industry Association (MOSEIA) website. MOSEIA members report on the rulemaking process, monitor the industry, and train installers. Bob Solger is a founding member and a key member of the board. You may also consult a tax professional to understand how the tax implications will affect you.

Find  listings of all federal, state, local and utility rebates, credits, grants and loans at the Database of State Incentives for Renewables & Efficiency (www.dsireusa.org).

Susan Brown has worked diligently to bring clean energy to Missourians. She now wants to make sure you get every available financial incentive for installing a TESS solar or wind energy system.  Stop by our showroom, call 816-877-6760, or email SusanB@TheEnergySavingsStore.com.

The slow and tedious process of working out the details on how to implement Proposition C continues.  Prop C, passed by Missouri voters 2 to 1 last fall, mandates that investor owned utilities (IOUs) increase the amount of electricity generated from renewable sources to 15% by 2021, 2% of which must come from solar photovoltaics.  The law requires IOUs to provide a $2.00 rebate per installed watt of solar PV power starting January 1, 2010.  The rebate is limited to $50,000 for a 25kW system.

The Public Service Commission, charged with overseeing Missouri utility rates, has been conducting stakeholder meetings between Kansas City Power & Light, Ameren, solar & wind installers and other interested parties to determine the highly detailed rules for how to implement the renewable energy requirements.  Prop C rules will set the amount of renewable energy required each year and how the funding for the solar rebates and renewable energy credits (RECs) will be distributed, as well as determine if the renewable energy will be required to be generated and purchased in Missouri, or out of state.  While the $2.00 per watt rebates have largely been agreed upon, the market price and purchase requirements of the RECs is still under discussion. 

The Energy Savings Store has teamed up with other solar industry leaders in the state to form an industry trade association, MOSEIA (Missouri Solar Energy Industry Association).  MOSEIA is taking part in the Public Service Commission (PSC) meetings and working to ensure that the PSC develops appropriate rules for Proposition C.  We want to ensure that solar rebates and benefits stay in Missouri, helping to bolster our energy independence and creating jobs within Missouri’s borders.

So far much of the suggested language and requirements submitted by the solar industry have not been adopted.  The latest drafts do not include the language MOSEIA is pushing for, including requirements that utilities pay for at least 10 years of renewable energy credits from customers upfront, a simplified contract for customers and the requirement that the renewable energy come from Missouri.  We will continue to make our case for these and other requirements that benefit Missouri citizens.

The next steps are for PSC staff to present the draft rules, including the suggestions of various stakeholder groups, to the Commissioners.  The Public Service Commissioners will hold a hearing open to the public to collect input from the citizens.  This will be an important opportunity for you to submit comments asking the commission to establish a long-term energy plan that includes renewable energy from within Missouri’s borders.  

Missouri currently relies on Wyoming coal for more than 85% of our energy supply.  It is just good common sense to diversify our energy source, so that we don’t have all of our “eggs” in the coal “basket.”  Reliable renewable energy keeps Missouri businesses competitive and will protect homeowners from price spikes.  We need to keep our energy dollars in state and invest in clean renewable energy that creates jobs here and provides energy from non-depletable sources like the sun and wind.  

Coupled with new federal tax incentives, electricity generating solar photovoltaics are more affordable than ever in Missouri, and the industry is expected to grow quickly in 2010.  The solar industry is well positioned to meet that demand, producing Missouri jobs, supporting small businesses, and growing our local economies.

We expect the Public Service Commission hearing to be held within the next couple of months.  Watch for the announcement through our newsletter.  Please join the solar industry leaders in expressing your support of clean renewable energy for Missouri!

Thanks to Carla Klein for submitting this article.

The group’s formation is in large part a response to the passage of Proposition C, the Clean Energy Initiative, which Missourians passed during last November’s election with an overwhelming 66% of the vote.  Proposition C mandates 15% of the electricity produced by Missouri investor owned utilities (IOUs) comes from renewable sources by 2021, 2% of which must come from solar photovoltaics. 

Industry professionals predict as much as 150 megawatts of new solar development in Missouri, enough energy to power 15,000 homes, as a result of the measure.  In addition, Proposition C includes a solar rebate requirement that will refund $2.00 per installed watt (roughly 20% of an installed system’s price) for Missourians who install on their homes or businesses in investor owned utility territory.

Coupled with new federal tax incentives, electricity generating solar photovoltaics are more affordable than ever in Missouri, and the industry is expected to grow quickly in 2010.  The solar industry is well positioned to meet that demand, producing Missouri jobs, supporting small businesses, and growing our local economies. 

One of the first priorities for MOSEIA will be to ensure that the Public Service Commission develops appropriate rules for Proposition C, ensuring that solar rebates and benefits stay in Missouri, helping to bolster our energy independence and creating jobs within Missouri’s borders.

MOSEIA, which provided this press release, plans to become the Missouri state chapter of the national Solar Energy Industries Association (SEIA).  More information can be found at www.SEIA.org.

Solar and wind systems provide significant returns when rising rates are taken into consideration

While many people love the idea of using clean, renewable energy from the sun and wind, they find the investment significant enough to think twice about the purchase.  The installed cost of a mid-sized wind turbine or solar photovoltaic (PV) system is about $20,000, and does not provide the same visibility or utility as a new kitchen.  However, while a new kitchen provides a great new space to cook and congregate, and will bring back nearly every dollar invested if the house is sold soon after, it loses its value over time. The renewable energy systems, on the other hand, become cash cows that actually increase in value as energy prices rise.

A simple payback will show you that the money you initially invest in the system is offset by the value of the energy produced over time.  This becomes a little tricky, because we know that energy prices will rise, but can't predict actual rate increases without a crystal ball. Historical rate increases over the past 10 years or so have been about 4.5% per year, although this varies widely across the country.  Over the next 20 years, we expect rates to increase 6-9 percent per year, given supply pressures on fossil fuels and imminent carbon taxes.  Just like the miracle of compounding interest, the compounding effect of rising electric rates results in the system returning 1.5 to 3 times its initial cost.

While the life expectancy of a solar PV system is generally 40-50 years, we typically look at 30-years of operation to calculate expected returns on both solar and wind.  (Wind turbines require maintenance, and the turbine itself can be replaced with a more efficient unit at a fraction of the cost of the original installation.)  The chart below shows the value of the electricity produced over a thirty year period.

Estimated value of power produced by 2.4kW solar array*

*Assumes $0.09 p/kWh with 7.5% annual inflation on electric rates for 2.4kW solar PV system

Our February newsletter summarized the highlights of the American Recovery and Reinvestment Act of 2009.  With this legislation, the 30 percent tax credit for commercial and residential renewable energy investments was extended through 2016, and the $2000 cap was eliminated.  This tax credit effectively creates a 30% discount on all solar and wind installations, reducing your investment accordingly.  (For commercial projects, you can apply for a grant up front in lieu of the tax credit.)  Additionally, the state of Illinois offers a 30% state tax credit for solar, and is considering extending this to wind power also.  Historic tax credits of up to 25% are also widely available, depending on the area.

Finally, the recently passed Proposition C in Missouri will require that utilities produce 15% of their total demand with renewable energy.  The Public Service Commission is currently finalizing the rules, but at this point it is agreed that the investor-owned utilities (including AmerenUE, KCP&L, and possibly Empire)will  provide a taxable rebate of $2 per installed watt (up to 25kW).  In addition, they may buy Renewable Energy Credits (RECs) based on the amount of electricity produced by your system.  It is anticipated that the value of this taxable income would be similar to the rebate ($1.80-$2.20 p/watt) but this will likely be paid out over time as the energy is produced.

So the 2.4kW system described above might look like this:

* Actual figures are contingent upon the finalization of rules. Prop C rebates will go into effect January 1, 2010.

Using the assumptions above, the system will have produced a total of $4,400 in electricity in its 12th year of service, thus paying for itself.  However, in the 18 years after it's paid off, it will produce an additional $23,500 worth of power, yielding an internal rate of return of 11.7%.  Businesses will achieve even greater returns by depreciating equipment.

In spite of this return on the investment, for some people, this long of a payback is troubling because they may not intend to live in the house that long. The truth is, that, just like the kitchen, an investment in a solar or wind energy system will add to the value of the home, with a higher return than a kitchen or bathroom renovation.

While the return on your investment may not match some of the historic returns of the market, you can be sure that it will be much less volatile.  Probably more important than anything, you must place intrinsic value on producing your own clean, renewable energy.   As one of our customers put it, "No one ever expects to catch enough fish to pay for their new bass boat!"

President Obama signs stimulus bill to promote renewable energy

Changes have begun to take form in new legislation supporting renewable energy.  A number of new provisions for solar and wind energy have been included in the economic recovery bill, signed into law by President Obama on February 17.

DOE Renewable Energy Grants: Given the economic downturn, many traditional solar project financiers were left without the tax appetite necessary to put the 30 percent solar tax credit to good use. This provision puts solar financing back on track by offering DOE grants as an alternative to the tax credit.  This is a big incentive, because a grant provides immediate cash without having to wait to claim the tax credit.  To be eligible for the program, the project must commence construction in 2009 or 2010.

Clarification on Municipal Solar Finance Programs: Around the country, cities are implementing innovative finance programs that help residents and businesses implement solar technologies. As the tax code was written, there was some uncertainty as to whether participants in these programs could claim the federal solar tax credit. This provision ensures that businesses and individuals can qualify for the full amount of the solar tax credit, even if projects are financed with local development bonds or other subsidized energy financing.

Loan Guarantee Program: This provision is especially helpful for the development of large-scale solar power plants. It establishes a temporary DOE loan guarantee program for renewable energy and electric power transmission projects. The program is available for any renewable project that commences construction by September 30, 2011.  The program provides $6 billion in renewable funding.

Manufacturing Investment Credit: Everyone wants manufacturing jobs, and this provision will help attract solar manufacturing facilities to the US. It provides up to $2.3 billion to fund 30 percent investment tax credit for facilities engaged in the manufacture of advanced energy technologies. Projects must be certified by the Treasury, in consultation with the Secretary of Energy, through competitive bidding.

Solar Water Heating: This provision gives solar hot water heaters the same treatment as solar PV panels. It repeals the $2,000 monetary cap, making solar water heating property eligible for the full 30 percent tax credit.

Grant Program Extended to Wind Power Generation:  New legislation includes a grant program to monetize tax incentives for renewable energy, and provides a three-year extension of the production tax credit.  The bill also includes provisions to promote transmission for renewable energy, and a removal of the cost cap on the small wind investment tax credit of $4,000.  Under the new law, a full 30% grant will be available to offset the cost of installing a system.

In the coming weeks, the implementation rules will be put in place. Check our website regularly for updates.