Solarize Arlington FAQ
These are frequently asked questions about Solarize Arlington. For more information about
home solar photovoltaic electricity generation, the internet is your oyster. Wikipedia is often a
good place to start. Other good sources are MassCEC and SolarFlair’s Solarize Arlington page.
Topics:
Why this is a good time to go solar
Why should I participate in Solarize Arlington
How much does it cost
What are the requirements
Impact on my property
Maintenance
backup generators
Town Participation (Town buildings)
Carbon Footprint
Why is this a good time to go solar?
Installing solar power for your home or business has never been more cost-effective than it is
today, and solar power will save you money compared to grid power. The two main reasons
are:
1) State and Federal incentives. Installing a solar electric system in Massachusetts is not cost
effective without them. Right now incentives are quite high, making solar power very attractive.
●
●
Incentives at installation
○ State incentives
■ There is a modest state rebate ($0.40-0.85 per watt) applied against the
initial cost of the system.
■ State income tax credit of 15% of the installed cost, up to a maximum of
$1,000.
■ Solar power systems are exempt from state sales tax.
○ Federal incentives - You get 30% of the initial cost (less the state rebate) as
a credit against your federal income tax for the year you install the system.
Currently you can carry forward unused credits for a limited period of time.
Ongoing state incentives
○ Net metering (when your meter “spins” backwards when you are producing more
electricity than you are using) allows you to bank excess electricity production
with your utility. For months in which you produce more than you consume, you
receive a credit on your utility bill against future electricity purchases.
○ Not only do you avoid paying NSTAR for the electricity you generate, the state of
Massachusetts will pay you for the renewable energy attributes of that electricity.
■ For the first ten years your solar power system is in operation, for every
1,000 kilowatt-hours (kWh) you generate, you create one solar renewable
energy certificate (SREC), which you can sell to Massachusetts utilities
and competitive electricity providers. Prices are market-based, but
range from about $250-500 apiece (after commission). Transactions are
typically handled by an SREC broker that you select.
2) Price drops and buying in bulk. In general, solar photovoltaic (PV) system prices have
fallen about 30% over the last three years. And there are additional savings to be had through
the Solarize Mass program, including:
● A community-led marketing and outreach campaign, which lowers the cost of doing
business for the selected installer, specifically the costs of finding new customers.
● By creating a large volume of business for a single installer in Arlington, the installer
is able to provide volume discounts that increase as more people participate in the
program.
SRECs are a legislative creation. Can a future legislature take them away? As with any
government incentive (for anything, not just renewable energy), legislation can either repeal
them or change them. But Massachusetts has a long history of stable support for renewable
energy and a lot of incentive of its own for ensuring the ongoing success of its renewable
energy policies.
Why should I participate in Solarize Arlington?
The Solarize Arlington program offers significant savings over current market prices for solar
power, through the designated installer, Solarflair.
Do I need to use Solarflair? If you want to take advantage of the Solarize Arlington volume
pricing discount, you need to use Solarflair. However, you are still free to get other bids from,
and use, other PV installers as part of their normal business, if you do not want to participate in
Solarize Arlington.
How good a deal is Solarflair’s pricing relative to the market? Solarflair’s pricing for this
program is about 30% less than the average pricing for residential PV systems installed in 2011
in Massachusetts.
How long does the program last? In order to take advantage of the Solarize Arlington pricing,
you need to commit to the program (sign a contract) by September 30, 2012.
How much does it cost?
There are two options for going solar - you can purchase the system or lease it.
How much does purchasing cost? When you purchase a system, you receive all of the financial
incentives listed above. There is a relatively large cash outlay up front but you recoup almost
half of it in rebates and tax incentives. Using round numbers for a ‘typical’ 5 kW installation,
your cash outlay would be about $20,000. After rebates and incentives, the net price would
be about $11,600. Then the electricity you generate reduces your electricity purchases from
NSTAR, and SREC sales provide additional income. Combined they are about $2,300 per year,
so the payback period is about 5 years. For years 6-10, you would continue to save/earn about
$2,300/year. After year 10, the SREC sales would stop but you would continue to save on your
electricity bills.
When you get your free, no-obligation assessment from Solarflair, they will provide you with
financial information customized to your particular situation.
How much does leasing cost? With leasing, a third-party finance company owns the system,
and you pay them based on a preset payment schedule, typically lasting 20 years. The
lease payment reflects the fact that the leasing company takes advantage of all the financial
incentives mentioned above, plus one or two not available to you. As such, for the homeowner,
there usually isn’t any up-front cost and you start saving money on day one. The amount you
save depends on the quality of your site and the relative size of the PV system compared to
your total electricity bill. The best way to find out for sure about the cost of your particular lease
is to sign up for a free, no-obligation site assessment from Solarflair.
In addition to no money down options, you have options to partially or fully pre-pay your lease.
A partial pre-pay will reduce the monthly payment, whereas a full prepay will eliminate it, so that
all you pay for going forward is whatever electricity you still buy from the grid.
When you lease the system, the third-party finance company is also responsible for maintaining
the system and repairing anything that breaks.
What happens to my leased installation after the 20 year lease period? Typically, you have two
options: renew the lease or have the company remove the system at no cost to you.
If I lease, what happens if I sell my house? When you sell your house, the buyers take over the
remaining time of the lease (the lease has provisions for this). The only requirement is that they
must pass a credit check (which they likely will, if they can afford to buy your house).
What are the pros and cons of owning vs leasing? If you own the system, you are likely to
achieve higher long-term cost savings, but it requires a relatively high initial investment -- even
after incentives. With leasing, you can start saving from day one with a lower electricity rate
than grid power, but your long-term savings will likely be lower than with purchasing. Leasing
also has the advantage that the leasing company is responsible for all repairs over the 20-year
life of the lease, and since the lease includes a performance guarantee, it is in their interest to
make sure the system is operating as much as possible. However, it should be noted that PV
technology has an excellent track record of reliability, and even if you own your system, you
can expect many years of trouble-free operation and you are unlikely to have to pay for costly
repairs. This is not like owning a car (see more info below on warranties)
What is the tiered pricing rate schedule? The Solarize Mass program rewards all participants
as more people sign up. Solarflair’s pricing is divided into five tiers based on the total contracted
capacity, as shown in the table below. As more people contract with Solarflair everybody under
contract moves into the next pricing tier until a total of 250 kW is under contract, at which point
the pricing is at the lowest tier. The state average residential PV system size is about 5 kW, so
reaching Tier 5 requires about 50 households (maybe a little more in Arlington due to smaller
home sizes).
As of early August 2012, based on interest levels, Solarize Arlington anticipates that Tier 5
pricing will be reached.
Tier
Level
Total
Contracted PV
Capacity
Base Pricing for
Purchase Option* ($/
watt)
Base Pricing for
lease option*
(¢/kWh)
1
<25 kW
$3.69
6.5 ¢
2
25-50 kW
$3.62
6.3 ¢
3
50-150 kW
$3.55
5.9 ¢
4
150-250 kW
$3.47
5.5 ¢
5
>250 kW
$3.39
5.0 ¢
*base pricing may be subject to various cost adders particular to your site, including shading and other
factors. Lease pricing assumes no money down and a 2.9% annual escalation. Full details are available
from Solarflair.
What are the price “adders”? Every site is different and the price adders represent additional
items/activities that may need to be performed or installed as part of your PV installation.
Examples include upgrades to your electrical panel or structural reinforcement of the roof. Some
adders are optional, such as higher-efficiency panels or all-black panels (for aesthetic reasons).
Solarflair estimates that about half of all installations will have one or more price adders, and
that of those, half would be requirements and half would be optional. But these are not hard
numbers, only estimates. In last year’s Solarize Mass pilot community of Harvard, price adders
added less than 10% to the actual price paid, on average.
How necessary are adders like tilted panels? For most solar installations (i.e., pitched roofs
with asphalt shingles), panels are mounted on the same plane as the roof (offset by a few
inches). The added expense of tilting the panels to their optimum orientation is typically not
justified. As noted above, some adders will be required, while others are optional.
The price I was quoted by Solarflair was different than tiered pricing. Why? See the discussion
above about cost adders. Also, if you are selecting the lease option, the lease price depends
on how much sunlight your panels will receive. The ideal site has zero shading, is facing due
south and is tilted at 42 degrees (our latitude). Few, if any sites in Arlington will be ideal, and the
percent of ideal is typically expressed as the “total solar resource fraction”, or TSRF. The higher
the TSRF the more electricity you will produce for a given system size and cost, so the lower the
lease price will be. The base pricing above for the lease assumes a 95% TSRF, which is typical
of a house facing due southwest whose roof has the standard Arlington 30 degree pitch but no
shade at all. Note that in order to qualify for the state rebate, you must have a TSRF of at least
80%. It is still possible to install a system with a TSRF below 80% but the output will be lower
and you will not benefit from the state rebate. Even so, with the tiered pricing we have, a project
may still make economic sense with a TSRF below 80%. Ultimately, the decision to proceed is
up to you.
I want to make sure I get the lowest tier pricing possible. Should I wait until later in the summer
to contract with Solarflair? Everybody who contracts with Solarflair will ultimately receive the
same pricing tier, regardless of when they sign their contract. If, for example, you sign up when
we are in Tier 2, but we eventually reach Tier 5, you will still receive Tier 5 pricing. If you have
already paid Solarflair based on Tier 2 pricing, they will refund the difference.
Are price adders fairly priced? Solarflair’s price adders were reviewed as part of the proposal
evaluation process and were deemed to be fairly priced.
Panels and inverters degrade over time and eventually have to be replaced. What is the future,
unsubsidized replacement cost? Panels are typically warrantied to degrade (produce less
power) no more than 10% in the first 10 years, and no more than 20% in the first 20 (sometimes
25) years. However, they may well not need to be replaced for 35 years or more. With that said,
panel prices have fallen significantly in the last couple of years. If you ever need to replace them
in the future and they are, for some reason, out of warranty, by that time, you can expect them
to cost well under $1 per watt.
Inverters are typically warrantied for 10 years, and often last a few years longer. Today’s prices
for inverters are about $1,000 to $4,000, depending on system size.They too are expected to
come down in price in the future.
Will I start receiving SREC payments as soon as I generate the electricity? No. There will be a
delay (from six months to over a year) between electricity generation and payment for SRECS.
SRECS are “minted” on the fifteenth day of the first month after the quarter in which they are
generated. But they cannot be sold at auction for another quarter. So if you finish generating
1 MWh in the second quarter, they can not be auctioned until October, (perhaps even later if
the market doesn’t clear). But once you start receiving payments, they should come at regular
intervals.
What are the requirements?
The general technical requirements for a viable site are:
● A sunny roof (i.e., minimal shading from trees, other buildings, and structures such as
chimneys, dormers, skylights, and vent pipes)
● Generally southern exposure
● Roof in good condition (the newer the better)
SolarizeMass Program Requirements:
● To receive the Solarize Arlington volume pricing, you need to commit to the program
(sign a contract) by September 30, 2012.
● Systems larger than 15 kW are not eligible for the state rebate. However, Solarflair will
look at each system >15 kW on a case by case basis regarding eligibility for the tiered
pricing.
● In order to qualify for the state rebate:
○ your system would need to produce 80% or more electricity as an ideally
oriented, unshaded system.
○ you need to have had a home energy assessment within the last six years.
Sustainable Arlington is happy to be partnering with a locally-owned business,
Sagewell, to offer these energy assessments. They are free and are
conducted by a qualified home performance contractor. To request your free
energy assessment go to www.sagewell.com/assessment or call Sagewell
at 617.963.8141. You can also schedule a home energy assessment via
MassSave.
My best roof faces southwest (or southeast). Can I still participate? Yes. Panels facing due
southwest or southeast will typically generate about 95% of the energy of ideally-tilted panels
facing due south (sometimes more, depending on roof tilt). This will slightly impact project
economics, but less than, for example, shading or whether the roof needs reinforcement.
The combination of sub-optimal orientation and shading may make solar power no longer
financially viable. However, there are no hard-and-fast rules for what is or is not feasible. The
best way to find out is to sign up for a free, no obligation assessment from Solarflair.
I have some shade. Can I still participate? Yes. Even if the shading on your house reduces
your system’s output below 80% of ideal, you may still choose to participate, but the project will
likely be less financially viable. Again, the best way to find out for sure is to sign up for a free,
no obligation assessment from Solarflair.
I live in a historic district. Can I put panels on my roof? The head of the Historic District
Commission has publicly declared his strong support for Solarize Arlington and his desire to
work with the program to permit the installation of panels on historic houses. It has been noted
that adding panels does not permanently alter the house itself.
What if I rent/own a rental house? Renters cannot install PV systems, but owners of rental
property can. Since each situation is different, you should explain your situation to Solarflair so
they can come up with the best solution. Condo owners should also not be discouraged from
looking into solar power. There are technical and other solutions that make it possible to install
PV on condos.
Do I need a battery backup system for night time electricity? No. Your house remains
connected to the grid and you draw electricity from the grid when you need it. With net-metering
in Massachusetts, the utility (NSTAR) essentially acts as a “virtual battery” for your system.
That is, whenever your solar panels don’t produce enough electricity to meet your electrical
demand, you can get the rest from the grid. When you produce more electricity than you
consume, your meter will spin backwards and reduce your bill or create a credit on your bill that
essentially stores your “overproduction” for future use, just as a battery would.
Impact on my property
Panels on your roof
See Maintenance section below.
Effect on house value
Imagine two identical homes next to one another, one with solar and one without. It is not hard
to imagine that the house with solar would sell for more because it costs less to operate. An
article in the New York Times describes a California study that found the premium paid for
homes with solar power was roughly $5.50/watt, or about $17,000 (which was roughly the
installation price of the panels, at the time). For more details, you can view this report from
Lawrence Berkeley National Lab. Although the experience of the California market may not
apply exactly to the Arlington market, it does seem likely that the solar panels will add to a
home’s value.
Effect on property taxes
Although solar panels may affect the value of houses, they will not affect property taxes. Under
Massachusetts law, solar panels are exempt from local property taxes for 20 years after they
are installed.
Maintenance
What regular maintenance is there? Your solar power system should be mostly maintenance
free over its 25+ year life. You can hose down the panels once or twice a year, but since most
panels are tilted, this is not really necessary, as Mother Nature does this for you with rain and
snow. Removing snow is not recommended since you risk damaging the panels. It is better to
lose a few days of production in the winter (when output is low anyway) than to damage the
panels. In any event, snow slides off the panels much easier than the roof because the surface
is smooth (tempered glass) and as soon as part of the panel is exposed to the sun, it starts to
heat up and the snow melts off.
The inverter is likely to need replacing after ten or so years.
Solarflair offers an annual cleaning and system check after year 10 as a modest cost adder.
Warranties, cost for as-needed work? Solar power equipment is generally very reliable and
solar panels come standard with 20- or 25-year manufacturer warranties, and inverters with a
10-year manufacturer warranty.
All the installers bidding on Solarize Arlington included a 10-year workmanship warranty in
their base pricing, which is better than industry standard. Solarflair is also offering an extended
warranty as a price adder.
Outside of that, cost for as-needed work is on a case-by-case basis.
When higher efficiency panels are available in the future, can the existing panels be replaced
without having to replace all the mounting hardware and electrical equipment? Generally,
panels come in standard sizes, so, yes, it should be possible to replace existing panels with new
ones without changing mounting hardware. However, depending on how much more electricity
the new panels will produce, you may also need to upgrade to a larger capacity inverter, or
make other electrical upgrades to your breaker panel.
What happens to warranties if the companies go out of business? The manufacturer warranties
would remain in place (in fact, they set aside funds to cover warranties if they go out of
business).
What happens when the roof leaks and needs replacement? Roof leaks caused by one of
the roof penetrations made to secure the solar power system are covered by the 10-year
workmanship warranty from Solarflair. It should be noted however, that roof leaks are rare. Roof
penetrations are sealed with flashing similar to that used around vent pipes.
If your roof needs replacing you should do that before installing solar. There is no hard and fast
rule, but if your roof still has about 7-10 years of life left you can still install solar, but will need
to pay the additional labor costs to remove and replace the solar panels when the roof needs
replacing. At today’s prices, these extra costs might total $1,000 - $2,000.
Will my attic be cooler? Yes, your attic should be a little cooler with solar panels on the roof.
Not only is some of the sun’s energy converted to electricity instead of being turned into heat in
your attic, but the panels are installed a few inches above the roof surface, which keeps sunlight
from shining directly on your roof.
Backup generators
What if I have a backup generator? If you have a backup generator, you can continue to use
it as before. If you want to install a backup generator, you would do that as if there were no PV
system. The PV system is wired separately into your electrical panel, and for safety reasons, is
designed to automatically disconnect in the event of a power outage. When power is restored,
the inverter will automatically reconnect and synchronize to the grid and your PV system will
come back on.
Town participation (Town buildings)
Is the Town participating in Solarize Arlington for Town buildings? The Town is evaluating
solar power for its own facilities outside of the Solarize Arlington program, since those systems
would be much larger than the 15 kW maximum allowed under the Solarize Mass program. This
includes looking at PV for the new Thompson school.
The Town is supporting and facilitating the overall Solarize Arlington effort with some staff
resources, use of the Town Hall for meetings, and other administrative support. And of course,
the reason we can do this at all is because Arlington is designated a Green Community.
Impact on carbon footprint
What is the impact on my carbon footprint? A 5 kW system should produce about 6,000 kWh of
emissions-free electricity per year. This will reduce your annual CO2 emissions by about 4,800
lbs (based on the current New England fuel mix). This is equivalent to driving about 6,000 miles
less, planting half an acre of pine trees, recycling 1,400 pounds of waste instead of throwing it
out, or using 5 fewer barrels of oil.