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Welcome to the Arizona Solar Challenge Tumblr! We're your source for the latest updates about our work to put solar on 5% of homes in your community by the year 2015. We'll regularly feature photos, news clips and profiles of Solar Ambassadors from across the state. Learn more at the Arizona SmartPower website.



Posts tagged "investment"

Arizona Public Service is investing in the development of 200 MW of solar power plants across the state. This announcement comes after APS has seen astounding success with the Arizona Solar Challenge — a program to help owner-occupied homes achieve more than 5 percent solar by 2015.

Clearly, solar makes sense for Arizona. More than 5 of the Arizona Solar Challenge's 14 towns have already surpassed the program's 5 percent goal. An official Arizona Solar Community sign was just installed in two locations in Goodyear, where Mayor Georgia Lord could not have been more proud to see residents reaping the benefits of a wise, clean investment.

But homeowners aren’t the only ones seeing the potential to reap the benefits of a bright investment.

APS just announced a Request for Proposal (RFP) from solar developers and installers to construct a 32-megawatt (MW) solar photovoltaic facility in Gila Bend, Ariz. This project will be financed by APS through the company’s AZ Sun Program and and is expected to provide electricity to more than 8,000 Arizona homes. And create more than 2,000 local jobs, just in construction.

The potential for solar in Arizona is endless. While other less sunny states might not see the same rate of growth, they can certainly learn from the wise investments and important roles that utilities can play, as demonstrated by the Arizona Solar Challenge and this new AZ Sun Program.

While solar energy proponents, skeptics and pundits were debating the renewable energy source’s future, solar became mainstream.

ABOVE: U.S. Solar 2011 Year in Review in One Graphic via GreenTechMedia.

2011 will likely be judged as the year solar energy came of age, as examples of solar and wind energy developments last year are too numerous to list. Below are a few highlights.

- U.S. Photovoltaic Solar energy installations grew from 152 megawatts of power installed in the first quarter of 2010 to 776 megawatts in the fourth quarter of 2011. Year over year increases were 887 megawatts in 2010 to 1,855 megawatts in 2011 or a growth rate of 209%.

- Solar energy attracted massive investments from big money investors such as Warren Buffett’s Berkshire Hathaway, KKR, MetLife and John Hancock. These well-known investors claim solid 15% returns from their solar investments. “A solar power project with a long-term sales agreement could be viewed as a machine that generates revenue,” said Marty Klepper, an attorney at Skadden Arps Slate Meagher & Flom LLP, which helped arrange a solar deal for Buffett. “It’s an attractive investment for any firm, not just those in energy.”

- General Electric, already a major player in wind energy, broke ground on a $400 million solar panel manufacturing plant in Aurora, Colorado, which will be the largest solar panel manufacturing plant in the nation. GE will be competing with First Solar in CdTe thin film solar technology that has already established the world’s lowest manufacturing cost for solar panels. The entry of GE into thin film can only mean even lower prices for solar and more widespread adoption for residential, commercial and utility scale projects.

- Solar PV panel prices decreased 50% in 2011, resulting in an average 20% drop in total installation costs. The rapid price decline caused business failures for manufacturers introducing new technology and for non-cost competitive companies.

- Solar electric energy grew in all market segments including residential, solar and utility scale.

- California reached a total of one gigawatt of residential solar power. California homeowners’ roofs now generate power equal to one nuclear power plant.

- “With 30-year Treasuries yielding about 3.4 percent, investors are seeking safe places to park their money for years at a higher return. Solar energy fits the bill, with predictable cash flows guaranteed by contract for two decades or more. Those deals may be even more lucrative because many were signed before the cost of solar panels plunged 50 percent last year.”

- Dan Reicher, executive director of Stanford University’s center for energy policy and finance in California, said, “The beauty of solar is once you make the capital investment, you’ve got free fuel and very low operating costs.”

- Renewable energy is cheap today. The following are some key quotes from Climate Progress’s report on the solar market:

  • Last year was the first time global investments in renewable energy surpassed investments in fossil fuels
  • The United States is currently leading in corporate R&D and venture capital investments in clean energy globally, and last year retook the top spot in overall investment with a 33 percent increase to $55.9 billion
  • Some wind developers are signing long-term power-purchase agreements in the 3 cents a kilowatt-hour range, far cheaper than any other new power source. 
  • The clean energy sector is growing at a rate of 8.3 percent, nearly double the growth rate of the overall economy. 
  • The global market for clean energy was worth a whopping $250 billion in 2011. 
  • Solar energy development in Arizona increased by 333 percent in 2011. 
  • In California solar developers have signed contracts for power below the projected price of natural gas from a 500-MW combined-cycle power plant. 

The road ahead for solar and wind now seems clear. Prices are falling dramatically; leading financial institutions and manufactures have accepted solar and wind as mainstream industries; the use of fossil fuels continues to decline in energy production; electric power from coal in the U.S. has dropped from 50% to less than 40%; plans for more than 100 new coal fired power plants have been cancelled as retirement of older coal fired facilities has increased; the economics of solar and wind have made renewable energy the fuel of choice.

The transition from mining and burning coal and uranium for electric power to harnessing the free fuel of solar and wind will take a few years to complete, but the outcome is inevitable. Solar and wind will win.

Solar Coach Corner is a weekly column by Arizona SmartPower’s Solar Coach. These posts will go up every Tuesday and are meant to spark conversation about clean energy and energy efficiency topics, so join in by submitting your own comments below!

Solar Coach Dru Bacon with his solar array

Solar energy benefits can best be illustrated by real world examples, and the best one I can give is the one that has been sitting on my roof since August 22, 2008. That’s the day my 5.6 kilowatt or 5,600 watt solar electric array began operation. Since that date, my array has produced 35,018 kilowatt hours of electricity.

I live in the Arizona desert, where we have huge electric bills for air conditioning, but my solar system still provides 80 percent of my electricity needs for a 2,500 square foot home. For similarly sized houses in more moderate climates, my solar array would produce more than enough electricity to fully support the home’s needs.

Here are some facts about my solar system:

  • Commissioning Date: August 22, 2008 
  • System Size: 5,600 watts or 5.6 kilowatts 
  • Carbon Dioxide Averted: 59,922 lbs. [I am closing in on 30 Tons!] 
  • Energy Production to Date: 35,018 Kilowatt Hours 
  • Percent Production over Prediction: 20.1% 
  • Estimated Value of Production at Today’s Rates: $4,727 
  • Post Incentives Cost in 2008: $19,500 [Costs have declined and Federal Tax Credit have increased since my purchase.] 
  • Time to Recover Investment: 12 years at 4% annual utility rate increase. 
  • First Year Return on Investment: 6.5% with increasing ROI each year as my investment is paid back. After my investment is recovered, the ROI is infinite as I will have no ongoing costs. Solar electric panels are guaranteed to produce electricity for at least 25 years. Independent observers indicate that the lifespan of solar panels will actually be much longer.

Much has changed since I installed solar electricity. Perhaps the biggest change is the decrease in solar electric prices. At today’s cost and incentives, the same system for which I paid $19,500 would now cost about $11,300. Where my first year Return on Investment was 6.5 percent, today’s solar investor would receive a first year ROI of 12.2 percent. And that ROI includes a rebate decrease from my local utility from $3.00 per watt to $0.60 per watt. But incentives are intended to be short term.

Today’s solar investors will receive a far better return than I received, but I’m not complaining. A first year ROI of 6.5 percent is very good. And that ROI increases every year until my investment is recovered and then becomes essentially infinite, as I have no ongoing costs and all the savings are free. A 25 year performance guarantee from the manufacturer of my solar panels makes for what must be the lowest risk investment in history. A financial advisor friend told me that he searched for a high return – low risk investment and could find neither a higher return nor a lower risk investment than residential solar electricity.

Homeowners looking for a secure investment with high return should consider residential solar electricity. I did and I could not be happier with my decision. Now I’m just waiting for that battery electric car! Can’t wait to recharge it with solar electricity on my roof!

Solar Coach Corner is a weekly column by Arizona SmartPower’s Solar Coach. These posts will go up every Tuesday and are meant to spark conversation about clean energy and energy efficiency topics, so join in by submitting your own comments below!

Homeowners looking for low risk, high return investments should consider residential solar electric systems for their homes. Electricity is a commodity that we will always need, but the rates will continue to rise. Still, monthly electric bills are one expense that homeowners can turn into a great investment.

One way to consider the solar electric investment is to think that you would be prepaying your electric bill. In Arizona, electric rates can range up to 24 cents per kilowatt hour in summer months, when electricity usage is highest.

Solar electricity allows homeowners to buy electricity for a guaranteed 25-year period at about 4 cents per kilowatt-hour. That’s a great deal compared to today’s rates, but looks even better when compared to what electricity is likely to cost 25 years from now.

Solar electric panel manufacturers guarantee panel performance for 25 years because investors can recoup their investment in as little as 5 years, and solar systems can provide free electricity for up to 20 years. Residential solar electric systems also protect investors from electric rate increases.

Here are some other cool facts to consider about residential solar electricity: 

Solar Panels…

- Have no moving parts

- Require no maintenance

- Emit no pollutants

- Have zero fuel costs

- Are totally recyclable

So think about the solar electric investment, and please contact me, your Solar Coach, with any questions at dbacon@smartpower.org!

Flagstaff Solar Ambassadors Phil and Ann Eagan share why they went solar, what their system is like, and how they feel about it almost 3 years after installation.