Going Green? First, Check Your Wallet
Green Energy
New York, March 28, 2009 – The broad call for the use of green energy might be strong; but it might not be reaching everybody.
Even in the always-sunny island of Puerto Rico, the hype to install a solar energy system as an alternative energy source is not making much of an echo on its residents. The upfront cost in a time of global economic turmoil seems to be the biggest obstacle.
Anibal Riollano, a retiree from a pharmaceutical company who lives in Camuy, in the Northwest side of the island, has been thinking about installing a solar energy system in his home since last year. He has not made a decision yet. He thinks that the high installation costs versus the long-term savings are not attractive enough.
Besides the titanic task of finding a green energy licensed contractor in the island, Riollano would have to pay $65,000 for an 8,000 kWh/year solar panel system for his home, where he and his wife are the only occupants. Despite the fact that the Puerto Rican government implemented last year a fiscal incentive to deduct the costs, he would reach the breakeven point between the investment and the savings in about 20 years.
“On top of that, I would have to buy a new dryer, change my electric stove for a gas stove, and make less use of the air conditioners,” he said in a telephone interview from his home. “Now that oil prices have dropped, the energy bill did too. I feel less pressured to switch to green energy.”
But the idea is still in the air for Riollano, he said, noting that paying up front for the total cost of the system and waiting years to get the money back is an option that “takes green energy out of the priority list of poor people.”
Thousands of miles away from the Caribbean, Charles J. Virga agrees that a solar panel system costs a lot of money. Virga, a green energy licensed contractor and owner of Choose Green Energy LLC, a Solar Power Systems Company located in Union City, New Jersey, knows that people are not wholly embracing the green energy idea yet.
“They don’t know for sure that it works. I think a lot has to do with education. They keep hearing how expensive it is and assume that it takes too long to get your money back,” he said.
Virga notes that the fiscal incentives in the Tri-State Region are great for would be solar energy users. In an 8,000 watts system, which costs around $70,000, the home owner gets from New York State a $20,000 maximum cash incentive. And also a $5,000 maximum tax credit, as long as the person is eligible.
“At the Federal level, there is a tax credit of 30 percent of the total cost. And at the New York City level there is a 35 percent property tax abatement that is taken over four years. That is more than $6,000 per year approximately,” he said, adding that with all those incentives, a New York City home owner will reach the break-even point in just five years.
How the system works
A solar panel energy system is composed of a number of photovoltaic panels that collect sunlight. DC (direct current) is generated from the panels and sent to an inverter that converts it into AC (alternating current) or regular electricity. The AC power flows directly into the home if there is a demand or into the utility grid if there is not. When power flows back to the utility grid, the meter turns backwards and because of the Net Metering Law the energy company buys the extra energy.
However, a house has to meet two basic conditions for the system to work. One is to have a South-facing roof space, and no shading from trees or other buildings. “It could be a Southwest or Southeast direction or a flat roof space to point the panels to the South. If you have a shade from a neighbor’s home that would not allow it to work,” Mr. Virga said.
One thing to keep in mind, Virga, added, is that “this is a strictly supplemental system.” In case of an outage, the system also goes down. “What you probably want to do is to put a generator or a battery backup,” he said, noting that the battery option is expensive and a “maintenance nightmare.”
House takes solar energy
When it comes to designing green energy homes, architects hear a lot of questions about solar panels from clients, but few end up choosing one. Jennifer Suharmadji, a design coordinator at SOSH Architects, an architectural company located in Manhattan, thinks that the solar panel technology is still an idea but not a reality to most people.
“I don’t think the average person is going to purchase one for their home tomorrow, but I do think that in 5 to 10 years the number will increase tremendously,” Suharmadji said, adding that the main con might be “the amount of energy that it [the system] actually does produce, which is relatively small compared to the amount of energy that is used by the average person and the physical amount of panels needed.”
Still, Virga sees more pros than cons from owning a solar panel system than Suharmadji. It’s true, he said, that the system costs a lot of money, but “we have all this money coming in from the government.”
“The good thing is that for every dollar you spend on reducing your energy at your home, its value goes up by $20. Some people don’t feel that solar panels are beautiful, which is very strange to me,” Virga said. “What’s more beautiful, an electric bill for the next 35 years that says $0, or a skylight in the front of your house? That’s a personal decision.”
