Washington Co-op Capitalizes on Low Solar Costs
August 06, 2012
WASHINGTON, D.C. – Greg Watson has promoted solar power around the world for years.
“I work in green [technology] for an international development bank, [and] I’m always saying, ‘Look, the costs are down, there are all these incentives, really it makes economic sense for you,'” he says, describing how he convinces others to go solar.
But this year the Washington, D.C., resident decided to take his own advice.
“It’s nice to be able to see that actually happening for me, too, in the United States,” he says.
For years the high cost of photovoltaic (PV) panels, which convert sunlight into electricity, meant that only wealthy Americans could afford them. But that cost has been falling steadily, and panel installations in the U.S. jumped 31 percent in 2011, many of them on middle-income households.
A Group Enterprise
In D.C., 17 neighborhood networks — so-called solar cooperatives — have sprung up over the past six years. Mike Barrette, who started one of these co-ops just down the street from the U.S. Capitol, says recent changes in the market have only worked to his advantage.
“We interviewed vendors [and] brought experts in,” he says. “We started talking the language, learning the acronyms and all that. I put on a 4.4-kilowatt system in 2010, and since that original decision, the prices of solar have dropped significantly, about 30 or 40 percent.”
That drop, combined with federal tax credits, rebates and and utility-cost savings, means that a typical residential solar-power system can pay for itself fairly quickly.
For D.C.resident Sean Carroll, it was these additional factors that finally persuaded him to take the solar plunge.
“For a while people expected it would take five, six, seven years to get a return on investment, [but] now, with these rebates and tax credits, it’s down to about a year or a year and a half,” he says. “Once you see that you break even pretty quickly, it makes you say, ‘Wow, of course I’m gonna do this’.”
Carroll and other co-op members have also saved money on their PV panels and installation costs by negotiating group discounts.
According to Watson, also a member of a D.C. solar co-op, his group’s leader bargained for a deal with local solar companies, an increasingly common practice in some states. In Massachusetts, for example, Boston is just one of 17 municipalities whose leaders are negotiating discounts for all residents.
“She basically had talked to some of the providers in DC and said, ‘If I can get five or ten houses together to purchase at the same time, could they get a better price?’ he says.
Beyond negotiating group rates, solar-panel leasing arrangements are also bringing new consumers into the fray.
Sixteen companies currently lease panels to home owners, which means that even those who can’t afford a large down-payment are still able to go solar and see huge cuts in their monthly electrical bills.
“I think I have about 18 panels on my roof,” says Monyna Dorsey, who began leasing the equipment in April. “Last year, my [monthly electrical] bill was running $375. In my very first month with [my provider], my bill was $29, [so] it has already paid for itself.”
But whether the cost of going solar will continue to fall is uncertain. Prices are still being driven down by a global surplus of PV panels, and the silicon wafers at their core — the very devices that make efficient energy production possible — are cheaper than ever to make.
But surpluses can dry up, and so can government incentives and tax rebate programs.
While some critics believe the public shouldn’t be obligated to subsidize private solar-power installations, others say that every source of energy gets subsidized one way or another.
As for Dorsey, her main concern is spreading the word.
“My neighbor next door, I told her about it, she’s ecstatic,” she says. “She wanted to take me to dinner!”