Sample Payback Calculations

The following are examples of photovoltaic (PV) system payback calculations.  They do not take into account the likely rise in energy prices which would make payback more rapid.

Note that since these tables were prepared, the California Energy Commission has again reduced the rebate paid to Californians using the sun to generate electricity.  Unfortunately, at the same time the price of photovoltaic panels has increased, placing more of a burden on persons wishing to generate electricity cleanly.

We are in the process of revising these sample calculations.

It remains our belief that, solar energy is a very good investment for anyone who expects to continue using electric and thermal energy.  The alternative is to pay the spiraling increases in utility supplied energy as producible energy supplies become more and more costly.

  Residential Solar Photovoltaic Systems
Proforma Cash Flow Analysis
1.8 kW 2.5 kW
System System
System Size Watts 1       1,800          2,500
Cost of Installed System 9     16,200        22,500
Less CEC ERRA Buydown Payment 3.20       5,760          8,000
5.80     10,440        14,500
Less 7.5% California Solar Tax Credit 0.44           783          1,088
After Tax Net cost of system       5.37       9,657        13,413
Less 5 Year retained value, Est. $4/Watt       4.00       7,200        10,000
        1.37       2,457          3,413
First Year Power Production ($0.15/kWh) 0.21 378 525
Second Year Power Production 0.21 378 525
Third Year Power Production 0.21 378 525
Fourth Year Power Production 0.21 378 525
Fifth Year Power Production 0.21 378 525
Sixth Year Power Production 0.21 378 525
      0.11           189              263
6.5 year payback
Equipment retains value for many years
Free electricity for 30 years
Protection from future rate increases
Shading of roof, car, or patio like a large tree
Environmentally clean solution to the energy crisis
Over 7000 grid connected systems in California
Financing often cheaper than utility bills and tax deductible

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  Commercial Solar Photovoltaic Systems
Proforma Cash Flow Analysis
per watt 2.5 kW 30 kW
System
System Size Watts 1       2,500 30,000
Cost of Installed System 9     22,500      270,000
Less CEC ERRA Buydown Payment 3.20       8,000      135,000
5.80     14,500      135,000
Less 10% Federal Energy Tax Credit 0.58       1,450        13,500
5.22     13,050      121,500
Less 7.5% California Solar Tax Credit 0.44       1,088        10,125
      4.79     11,963      111,375
Less Depreciation Sec. 179, MACRS,       1.91       4,785        44,550
(40% Bracket Fed and CA) 2.87       7,178        66,825
After Tax Net cost of system      
Year 5 retained value, Est. $4/Watt       4.00     10,000      120,000
  Gain in value       1.13       2,823        53,175
 
First Year Power Production ($0.15/kWh) 0.21 525 6300
Second Year Power Production 0.21 525 6300
Third Year Power Production 0.21 525 6300
Fourth Year Power Production 0.21 525 6300
Fifth Year Power Production 0.21 525 6300
Sixth Year Power Production 0.21 525 6300
      1.26       3,150        37,800
Positive Cash Flow from Outset
Equipment retains value for many years
Free electricity for 30 years
Protection from future rate increases
Shading of roof, car, or patio like a large tree
Environmentally clean solution to the energy crisis
Over 7000 grid connected systems in California
Financing often cheaper than utility bills and tax deductible

These are only sample calculations.  You are welcome to request information regarding your project and expectations by contacting:

Home Energy Systems, Inc.

CSL # 800657

6996 Convoy Court

San Diego, CA 92111

Tel: 858-278-2300

Fax: 858-278-2254

Email: Info@HomeEnergySystemsInc.com