California’s Clean Energy Ecosystem- Part 2

Save Money with Residential Solar and California’s Clean Energy

The residential solar lease is celebrating its tenth birthday!  Over the last decade, residential solar has skyrocketed in popularity. But, just recently, more people are choosing direct ownership of solar over the turnkey solar product owned by a third party, known as the “solar lease.”

The increasing number of homeowners choosing to own solar is just a reflection of the diversification of the industry and individuals’ desire to make a great investment. But, don’t worry, the solar lease and other similar turnkey solar products aren’t going anywhere! Solar power just costs less, so the number of residential solar systems will continue to grow by leaps and bounds as people figure out how much they can save.

GreenTechMedia just wrote a piece about this booming home solar market. But is it the right choice for you?

Use a Solar Lease or Power Purchase Agreement

Solar power has grown cheaper every year over the last decade. So, how low can it go?

On average, California’s residential electric rates range from 20 to 40 cents/kWh. A 400 square foot solar array on your roof can produce about 6,000 kWh per year in round numbers. After incentives, you might pay $10,000 to have solar panels installed, but over 20 years that’s less than 10 cents/kWh. If you don’t want to pay cash, there are a number of choices to finance the savings.

The solar lease rolls the capital cost of your solar system, including maintenance, into a monthly payment. The $10,000 system might cost $100 per month, but reduces your electric bill by $150/month. Alternately, you could choose a power purchase agreement (PPA) and buy electric power on a kWh basis.  PPAs might cost 15-20 cents/kWh, but if it shaves up to 40 cents/kWh off your bill, it’s a better deal than paying your utility. Sound too good to be true? The solar lease and PPA have been around for years. They’re good and they’re true.

If you have a sunny rooftop, take a look at Solar City, SungevitySun Run, or Vivint to lower your energy bills.

Use More Energy When It’s Clean, Less During Peak Demand

Now it’s time to blow your mind. Even if you don’t install solar on your home, you can enjoy the savings of solar power. There is so much energy now when it’s sunny, wholesale power prices drop system-wide, and utilities pass that savings on to you, the consumer.

This month, utility-scale solar in California reached 9 GW. That’s gigawatts, which is one billion watts, times nine. A GW is one million kilowatts (kW), which is the unit of the measurement for your home’s electric power bill.

California has about 11 million homes, so 9 GW is almost one kW per home. If every home was using 800 watts, every California home could run on solar power during the middle of the day!  Even better, there is a lot more solar power being generated on commercial and residential rooftops too. It’s safe to say, when it’s a sunny day in California, the power is ON and it’s cheap.

This much solar power is enough to supply half of California’s electricity during the low-demand days we see this time of year. During the summer, there’s plenty of air conditioning demand to soak up that much ”sun power,” but this time of year, wholesale electric power prices plummet when the sun is shining and electric power demand is low. By contrast, when the sun sets, California’s natural gas peaker plants crank up to compensate for the lack of solar power, and prices skyrocket; so does pollution.

If you’ve been waiting for clean energy to cost less, you don’t need to wait long. Just reduce your energy use from 5 pm to 8 pm, and your home will be running on some of the cleanest electric power in the country. It’s really that easy.

Harness California’s Wind Power

Before California started installing solar everywhere, there was plenty of wind power. Overall, the state has over 6 GW of wind power potential in its wind farms. When it’s windy, more than 4 GW of wind power can be generated by this system.

Seasonally, wind power generation is strongest in the spring and summer. Another attribute of wind power is that it generally picks up at night and dies down during the day. This works well to balance energy production with solar when it’s windy, but the state still needs plenty of power backup for times when it’s not sunny or windy. During the fall and winter months, it can be windy any time. When it’s windy, power prices drop because supply is being driven by mother nature, not consumer demand. This is why we show consumers the Wind Number. It’s a great way to save money using cleaner energy.

This year we’re seeing so much clean energy that wholesale electric power prices have been turning negative on a regular basis. Sometimes this happens when there is no wind, but when it’s sunny and electric power demand is low. Other times, it’s sunny and windy, creating up to 12 GW of combined solar and wind power, making California’s energy supply exceptionally green. When the clean energy is on and you’re not using electric power, prices turn negative, and can even lead grid operators to curtail wind power generation. This leads to a lost opportunity in terms of system-wide efficiency.

The Wind Number is designed to make California’s overall energy system more efficient by showing consumers when their energy supply is cleaner and costs less. Sabreez shows energy consumers how to use this clean energy and to lower their electric bill using the existing technology in their homes.

Balance Your Demand with Supply

Home solar still makes a great deal of sense whether you lease, buy, or borrow, but anybody can save money just by using more clean energy when it’s flowing into California’s Smart Grid.

California’s electric power utilities offer reduced rates to people that use this clean energy; they’re called “time of use” rates. The rate is low for most hours of the year, but higher during periods of higher demand. The peak rates charged during periods of higher demand are only slightly higher in the winter (+2 cents/kWh), but +7 cents/kWh more during the summer months.

The development of clean energy resources like solar has shifted demand so much, that the daily peak pricing periods have changed. They used to be centered on the middle of the day. Now peak prices occur primarily in the afternoon on weekdays. For now, electric vehicle owners can opt-in to super off-peak pricing during the overnight hours (although utilities may adjust this pricing as solar energy production increases further).

Just remember, clean energy costs less. The more energy you use when the energy supply is cleaner, the more money you’ll save. There are myriad ways to use energy differently now, just subscribe to our newsletter or download our App to see when energy is cleaner and costs less.