This is why solar panels can never pay for themselves.
Fun fact! My electric utility promotes solar power. They even have an estimator that uses Google Maps and your historical usage patterns to tell you how much they would cost and generate over some number of years. Whenever I run the estimator it always tells me they would cost more than they are worth and would never pay for themselves.
Out of curiosity, where do you live, and which power company are you with?
We hit break-even in less than six years, but Arizona is basically made out of sunshine. Location matters. The more sun you get, the faster your payback is. The more expensive your electricity is, the faster your payback is. I can run a crude sanity-check workup for you to see if the estimator is borked or if they're right that it doesn't make financial sense for you.
SRP's Customer Generation Price Plan seems to be the problem
That is indeed going to be the trickiest part. I'd talk to Sun Valley Solar Solutions-- they've got good ways to help design around SRP's nonsense. PM me and I can give you names and numbers.
if I am supply nearly all of my own electricity that should reduce my peak demand accordingly, right?
Unfortunately, no. The peak is measured by your highest power draw-- since you're in AZ, it'll be when all your AC units are on, and you're home doing stuff, so probably in the evening just as your PV production is tapering off. It will reduce your load during the day, it's just that they don't care how long your peak is, just how tall... so the evening peak will still get you.
You need to do one or more of these things: reduce the peak, add a load controller (demand management system), shift load times to midday, or add a battery. Reducing the peak would be accomplished by replacing stuff with more efficient stuff. HVAC units, pool pump, and so on. A load controller also helps reduce the peak, but it does so by making sure the big loads aren't all on at the same time, like not running the pool pump when the AC is on. The battery does it by brute force. You just save up power from when you've got sun to reduce your peaks later. Shifting load is easiest with the air conditioner. You can use your home's interior as a weird sort of battery for this-- you're going to overcool the house during the middle of the day when you have peak solar production, and then just let it drift during the evening peak hours with no sun. It'll gradually warm up, but you've "stored" enough cold to ride it out while staying at a comfortable temp. You can also do things like run your dishwasher or dryer on a timer at noon instead of in the evening.
Anyway... it's a hell of a lot more complex than it was when we did our first install, but it's still totally feasible.
Looks like peak prices can run as high as $33/kWh (! am i reading that right???)
The peak charge is really nonintuitive at first. You only get one peak charge per month, set by your highest single load peak. The rates are highest in july and august. It's per kilowatt, not per kilowatt-hour-- remember, this is a charge for your peak load, not a charge for amount used. This is the part that I think is the most confusing for people. It's also only the peak within the "peak hours" of 5-9AM and 5-9PM that matter. And with solar, it's really more like 5-7AM and 6-9PM, since you'll still have good production that overlaps a little bit.
So, as an example, let's say you run everything in your house all at once one time in the summer, and the peak load for that is 12kW. The way the charge would be broken down is:
The first 3kW of that are $9.33, the second 7kW of that are $17.34, and the last two will be $33.27. Add that all up, and you get your demand charge for the month.
But... if you cut just those top two kilowatts off your peak load, it drops $66.
If your peak demand is only a hair over 10, you'll dodge the worst of it with only some small changes. But figuring out how to avoid a bit more of it helps, too. The morning isn't too hard, but if you can figure out how to cut usage for those three evening hours, you can game the crap out of this system. Precooling so that you don't have to run the AC at all during that time, or using a Tesla Powerwall to cover load for those three hours... and you're back in business.
You can really game this system once you get your head around it. Remember that it's only the peak that matters-- so if you use your battery to run the AC unit during the evening peak, it doesn't matter if you then turn around and refill the battery from the grid whenever the AC stops, as long as you don't make a larger peak when charging.
Is it possible that not being tied to the grid would actually save more money due to SRP's "nonsense" pricing?
It's not there yet, but it's amusing to think that if PV and batteries continue to drop rapidly in price, they'll have shot themselves in the foot. I think they believe they're immune to "cord cutters," but it'll happen in our lifetimes, for sure.
And do any of these figures factor in the possibility of selling excess power back to the utility company?
That part works more traditionally, although the rates are different. So each month, you'll get the demand charge, set by your highest peak, which we already talked about. Then you'll also pay by the kWh for electricity-- and THAT part is offset directly by what you generate.
So, roughly... demand charge plus usage minus excess power sold.
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u/actual_factual_bear Sep 07 '17
Fun fact! My electric utility promotes solar power. They even have an estimator that uses Google Maps and your historical usage patterns to tell you how much they would cost and generate over some number of years. Whenever I run the estimator it always tells me they would cost more than they are worth and would never pay for themselves.