Grow Solar Prices and Financing
How Much Will My System Cost?
Through the Grow Solar program, we have secured discounted pricing on both the panel costs and labor. For the 2013 program, we are able to offer a standard $5/W price for the final installed cost of a standard flush-mounted system on a normal roof.* All solar installations are eligible for a 30% Federal Tax Credit, which can be rolled over to cover tax liability over 5 years. Currently, no state or utility rebates are available for solar, as all such rebates have been fully used in the rebate cycle that opened March 11th. Current state legislation may open up additional rebate or incentive funds, in which case we will time and structure these into the program to best serve our members.
The pricing comparisons below are for a 3kW (3,000 W) system, which is typical for a home with good south-facing solar access and a 100-amp electrical panel. Xcel will only net meter (pay you for any electricity that you produce above your consumption at retail rates) installations projected to cover up to 120% of your annual electrical production, so if you have very low electricity bills year-round, a smaller system may be appropriate. If you have 200-amp electrical panel, high electricity bills, and extensive roof space, a larger system may be appropriate. For a 3kW system, the $5/W cost works out to $15,000 before tax incentives. As compared to the state-wide average cost for residential solar panels at $7.50/W, this works out to a 33% price decrease for joining the program.
|3 kW US-Made||Explanation|
|2010 baseline cost||$22,500||2010 average $7.50/W x 3,000 W|
|upfront Grow Solar Cost (amount saved)||$15,000 ($7,500 saved)||Savings by participating in Grow Solar bulk buy|
|Federal Tax Credit||-$4,500||30% tax credit can be applied to tax liability over up to five years|
|Net Grow Solar Cost||$11,500||Net after subtracting tax credits from upfront Grow Solar costs|
* Grow Solar achieves these low costs through a standardized process, so two price increases apply in special circumstances: A. If you have a building that is 2 stories or more, add $1,500 to the costs identified above due to significant operational challenges and safety precautions work crew must take on these roofs. B If you want a custom-designed system other than a flush-mounted roof system (such as an awning, tilted off the roof, or ground-mounted), add $1,500 to the project cost.
You should also contact your neighborhood association to see if they have solar rebate programs or low-cost loan programs that you could use to install solar.
How Does The Cost Compare to the Benefits?
The average MN household spends almost $900 each year on electricity, a cost that can be entirely eliminated (or even turned into a limited net payment) through an appropriately sized solar array. At the rate of $5/W and the federal tax credit, the value of a Grow Solar array is equivalent to locking in an electrical rate of $0.11/kWh for the next 25 years. With recent Xcel Energy rate increases (over 8% in 2013), the effective residential electrical rate (your non-fixed charges divided by your number of kWh) is currently around $0.125/kWh, and is expected to continue increasing at 4-6% annually.
By making the upfront investment in solar, you can lock in a lower energy cost than paying today’s rates and protect yourself from the rising costs of energy over the next 25+ years.
Right now, going solar is a long term investment, but it’s a smart investment that will save you money over time. Think of it as buying 25+ years of power for less than you would pay at current rates (and much less than the rates of the future).
How Will I Finance My System?
Even though participating is a great investment, it still means that households need to be able to pay $15k upfront (for a 3kW array), which can pose a challenge. Thankfully, there are a number of loan programs available to help households pay the upfront cost of solar before the tax credits and rebates come in:
- Minnesota Fix Up Fund (some restrictions apply) http://mncee.org/Find-Programs-Financing/Minnesota-Fix-Up-Fund/
- Minneapolis Neighborhood low interest loans. Vary by neighborhood home improvement programs which are operated by CEE – most allow solar.http://www.mncee.org/Find-Programs-Financing/?cid=491&aid=2&a=Street+Address
- Financial One Credit Union 11465 Robinson Drive Coon Rapids, MN. 55433 Office: (763) 404-7604 https://www.financialonecu.com/ Deb Connell
- Admirals Bank 15 Park Row West Providence, RI 02903 Tel 800-572-7844 Ext.7377 | Dir. 401-248-7377 firstname.lastname@example.org. You can also start the on-line bank application process here: http://www.admiralsbankloans.com/home_improvement/home.asp
If you’re looking to join in Grow Solar, get a site assessment from MRES and have Applied Energy Innovations review the assessment and determine the solar capacity of your property and thus project cost before applying for a loan. We can help you identify a good financing fit for your goals.
A series of five financial payments will take place throughout the process. You will want to have your financing strategy or cash on hand in place by the second payment when products are ordered:
- Letter of intent, security deposit $1500.00
- Down Payment Material/Permits 50% of project remainder
- Upon delivery to site/start of work 25% of project remainder
- Upon substantial completion 15% of project remainder
- Upon final electrical inspection 10% of project remainder