Utility Fees For Solar Hookups
Unfortunately, you may still get dinged for demand charges from a utility. These are fees imposed just to keep you connected to the grid, regardless of whether you use power from it at all. Many building codes require a backup in case a solar system fails. Other utilities argue that having fewer people on the grid increases rates across the board since they cant sell at high enough of a scale. Additional fees help the make up that difference so electrical rates for all customers can stay lower, in theory.
The legitimacy of those arguments is open to debate, but many solar power evangelists see these as cynical means of pushing back on the solar trend thats threatening the bottom line of entrenched energy utilities shackled to dirty power.
Also Check: How Are Solar Panels Made
What Is The Minimum Space Needed For A Solar Farm
There are no two ways about it, solar farms need space and lots of it. To generate roughly 1 MW of energy, you would need between six and eight acres. This isnt just for the panels though you also need to accommodate essential equipment such as inverters and storage batteries. You have to ensure that there is adequate space between the panels for any maintenance needed, too.
How Much Does It Cost To Set Up A Solar Farm
Installation costs are often quoted at between $0.80 and $1.36 per solar watt installed, but Im not sure where these figures come from. Its generally known that solar farm installation costs are less then half than domestic solar costs, which are well under $3/solar watt in the US.
Its probably safe to assume $1/watt as an average figure, making our calculation easier. For a solar farm minimum size of 1mW it will cost about $1 million for the physical installation of panels and all associated equipment.
Basic cost of setting up equipment for a 1mW solar farm = $1 million.
Add another 15% to 20% to this if single axis solar tracking equipment is needed to maximize output. Its rare to have dual-axis tracking on solar farms due to the poorer ROI associated with it.
Solar farm installation cost including single-axis sun tracking = $1.2 million
Associated permits and licenses = $5000
Hook up to grid = $3000 to $10000 .
Software to coordinate and manage solar strings = $3000
Ongoing maintenance = $20/kw x 10000kW = $20000/year
More resources relating to making money with solar farms:
Read Also: How To Switch From Sole Proprietor To S Corp
Average Cost Of Solar Energy
As the total cost of going solar in the USA has been on the decline in the past decade, the federal tax credit was introduced to bring the average total cost even further down. Solar is now cheaper than coal or natural gas and the national average price for solar panels has dropped by around 80%.
Nowadays, solar arrays are not reserved for experimental purposes only, but residential system size is more affordable than ever. A typical 5kW system used to cost $40,000 back in 2010. Today, that same system costs less than $18,000, for a premium product.
As new breakthroughs are made in the technology, every solar installer will be able to offer even large system-size solar arrays for a much lower price. The increasing efficiency and mass production are sure to bring average prices on both per W and per kWh down significantly. The US Energy Information Administration announces that with reduced prices, the total solar capacity in the USA could increase by 81GW from 2019.
Support From The Solar Trade Association
Solar Energy UK is a not-for-profit organisation that offers resources and guidance on all aspects of solar energy production for both commercial and domestic installations. All members of the Association follow best-practice guidelines to ensure solar farms are delivering a positive influence on both the energy production of the UK, and the environment. Their main points include:
Recommended Reading: How Much Does A Typical Solar System Cost
The Invention Of Solar Panels By Usa
Solar panels were invented in the States back in the 1800s. The technology was lucrative, but profits were nowhere to be seen. The cost of solar was simply too high and energy store non-existent. Then, in the 1900s, American scientists created silicone solar panels and made solar power much cheaper. There was still no solar energy market and the few solar panel systems that were produced were mostly of the experimental value.
How Long Does It Take To Build A Farm
Ultimately, how long it takes to build a solar farm will depend on the size of the solar project and the number of people working on it.
The actual building itself can often be completed in only a matter of months.
That said, if you include siting and permitting, the process gets a lot more complicated.
In fact, it can take 3 to 5 years to get all the necessary approvals and contracts completed for a solar farm.
Once the farm is complete and online, youll have to maintain it and service it about 3-4 times a year.
You May Like: What Size Charge Controller For 300w Solar Panel
Utility Solar Vs Community Solar Farms
There are two types of solar farms and the main difference is that Utility Solar Farms are usually much larger than Community Solar Farms.
Utility Solar farms can have a capacity of anywhere between 1 MW to 2,000 MW while Community Solar Farms generally operate under 5 MW in size.
They also provide power to different consumers.
Because of their large scale, Utility Solar Farms provide energy to utility companies and their customers as part of the energy that is carried on its power lines.
Community solar farms tend to serve individual consumers who subscribe for a share of its power.
Is It Worth Building A Solar Farm
In the case of an unsuitable roof or a preference not to have solar panels on your property, joining a community solar farm can be a great option. The costs of joining a community solar project can still be low, and the terms of the contract can be advantageous regardless of whether your roof is suitable for solar.
Don’t Miss: How To Size A Residential Solar System
Technical Considerations During Planning Stage:
You will need to submit a certain amount of information for your proposal, including:
- Solar resource estimates on how much energy you are expecting to generate
- Topography the position of the farm and its potential impact on the surrounding countryside both visually and productively
- Proximity to existing grid infrastructure how easy is it to supply the energy generated to the National Grid
What Are The Cons Of Solar Farms
Wondering if theres anything you should know before you invest in solar farming?
Its not a seamless investment, and there are some things you should keep in mind.
Not aesthetically pleasing
One of the main reasons that people dislike land near solar farms is because it can be a bit of an eyesore.
In fact, people worry that theyll lower their home value or provide a terrible view outside their window.
As this is a personal preference, it can be a tricky topic to discuss when deciding where to place them in an existing neighborhood or community.
Some people worry that solar farms will come with a bunch of noise like wind turbines.
Fortunately, one great thing about these farms is that they are virtually silent.
The only time you will see any type of maintenance on them is when they need to be repaired.
Theyre also silent when operating.
Concerns about too much electricity
While living next to a solar farm isnt dangerous, there are some concerns that there will be too much electricity and that it could be dangerous to peoples health, functioning electronics, state of their home, etc.
The good news is that theres no reason to fear living by a solar farm any more than you should fear living anywhere else.
The photovoltaic manufacturing process utilizes toxic chemicals, including hydrochloric acid, sulfuric acid, nitric acid, hydrogen fluoride, 1, 1, 1-trichloroethane, and acetone.
Recommended Reading: How Efficient Is Tesla Solar Roof
How Much Does A 10kw Battery Cost
US battery costs are expected to decline in the upcoming years. Currently, a 10kWh battery system with installation could cost anywhere between $7,500 and $12,000 to install and is enough to power a small household for up to a day. Most batteries can be stacked to give you more capacity and power larger homes for longer times.
Solar Farm Return On Investment
As you can see, the initial startup costs of a solar farm are not cheap, unless you decide to lease out your land.
From the siting and permitting process to the purchase and installation of the actual solar equipment, a 1 MW solar farm can cost anywhere between $820,000 and $1.36 million.
According to Paradise Solar Energy, in 2019 their Utility farms had an average ROI of 15.55% and a payback period of 8.1 years across all states. Community solar farms had an average ROI of 13.91% and an average of 8.21 year payback period.
Sara Gambone from Paradise Solar Energy notes, “The amount of electricity you use, the rate you pay, your systems size, the system’s installation cost and your local weather are just some of the variables that will cause your numbers to deviate from these averages.”
If you have the initial capital to install a solar farm, the ROI is quite good and the maintenance is low, so you don’t need to worry about incurring a lot of additional costs.
Recommended Reading: Can You Change A Business From Sole Proprietorship To Llc
Rooftop Solar Vs Solar Farms
Joining a community solar farm can be a great option if your roof isnt right for solar or dont want solar panels installed on your property. Even if your roof is good for solar, enrolling in a community solar project can still be worth it if the costs are low and the contract terms are beneficial. As community solar projects become more common and the contract terms become more consumer-friendly, solar farm options will compete even more with rooftop solar. However, each individual property has unique challenges and considerations, and theres no easy way to determine if youre the right candidate for joining a solar farm.
Check out our comparison of rooftop and community solar for a more in-depth look at how the two options stack up against one another.
Amount Of Land You Have
This is a tricky one because there is no simple guideline here. In most cases, the more land you have, the more valuable it is per acre. Thats because there are significant economies of scale in building large solar farms , which reduces the developers costs per MW of capacity.
However, the regional supply of available land tempers this. In southwestern states, finding 100 acres or more of flat, clear land isnt a big challenge. In and of itself, the fact that one landowner in Nevada has 500 acres and another has 100 doesnt mean that the 500-acre property is worth more per acre. But to find 500 acres of flat, clear land in Virginia is extremely rare, and in that case 500 acres is worth much more per-acre than 100 acres there.
In addition, sometimes developers want to build smaller to meet a particular energy buyers needs, or to benefit from a tax incentive for a project of a specific size. There is currently an incentive in NY state, for example, to build 5 MW community solar farms, which requires about 40 acres. Developers want to build right up to this limit to maximize their economies of scale, but wont build any bigger than that. And in this case, the going rate for land in NY for community solar projects currently hovers between $1,000 and $1,5000 per acre. Compare that to central Texas, where lease rates are typically in the $400-$600 per acre range.
Read Also: Can I Sell Solar Energy
Are Floating Solar Farms The Future
As the cost of sustainable energy falls, so will the entry hurdles. However, like the solutions, those impediments should be tailored to unique geographic regions and human circumstances. Solar power is becoming a more inexpensive, accessible, and efficient energy source, and we need to find innovative ways to adapt its production to meet people’s and the planet’s different demands. Floating solar is unlikely to supplant large-scale utility generation or the growing trend of terrestrial solar farms soon. But it’s possible that they could fill an important complementary role, adding capacity where it lacks today.
The installation of floating solar panels is not for everyone. Many floating solar panels are large-scale, providing solar energy to utility companies, huge communities, businesses, and towns. If one is interested in solar power for their home, installing rooftop solar panels or ground-mounted solar panels is far more cost-effective. Those that invest in a floating solar panel installation usually have access to a massive body of water large enough to accommodate hundreds or even thousands of solar panels. Residential solar panel installation will typically have around 20 solar panels because they only provide power for one home. Small-scale solar panel installations are not done by the solar panel installation businesses and developers who install floating solar panels.
What Are The Labor Costs To Install A Solar System
The rise in incentives and reduction in manufacturing costs is helping manufacturers to offer solar energy system at an affordable price. The solar energy system uses the suns energy to generate electricity. The panels contain photovoltaic cells that function in unison. The light that falls on the cells gets converted into usable energy. The panels then direct the energy to the inverter that converts into electricity. For example, a 6kW solar energy system costs around $ 18,000.
Read Also: Can You Heat Your House With Solar Panels
Using Data Planning And Embracing Technology Are Key To Decreasing Costs
Solar has been the renewable energy with the greatest cost reduction of the last decade. The reasons for this can be summarized mainly in: competitive pressures, greater installer experience, the spread of best practice installation and soft costs, module efficiency improvements and digitalization.
Nevertheless, although these reasons explain the reduction of costs until now, if the curve is to keep its path downward, investing in digitalization and AI technologies is a must.
It is clear that costs may vary vastly depending on your location and the conditions of the plant. However, what we must prioritize is always providing the most accurate preliminary design based on known historical data, to properly plan the project ahead and avoid unexpected costs.
How can we do that?
Did you know that recent study by Inderwildi et al. , estimates that digitalisation has the potential to increase carbon abatement by 20%?
Let us introduce RatedPowerâs software, pvDesign, that will allow you to perform different simulations to thoroughly analyze the feasibility of different projects, locations and equipment, while optimizing the layout of your solar photovoltaic projects and then obtaining +300 pages of documentation for planning and financial analysis. Watch our introductory video for further information and donât hesitate to contact us!
Did you like this post?
Check all my articles!
Cons Of Starting A Solar Farm
1. Solar Farms Take up a Lot of Space
Since they are ground mounted, solar panels require a lot of space.
2. Solar Farms Are Expensive.
The investment costs are quite high as discussed in earlier sections, so you will need to be adequately capitalized to start this type of business.
3. Set Up is Complex
As we discussed, there are significant permitting and other licenses that may be required and the entire process can take years. This is not something that you will be able to start in a month.
4. Power Storage Can Be Expensive
People need electricity 24/7 but the solar panels work only in daytime. So for the surplus electricity generated , storage is required. Lithium-ion battery packs are commonly used to store solar energy and they cost around $1,000 per kilowatt-hour.
Don’t Miss: How Much Does Solar Installer Make
Federal Investment Tax Credit
Federal ITC offers up to 26% off your solar installation cost. Solar panels cost is therefore reduced and you can enjoy solar energy cost per kWh that is 26% lower than otherwise. Your solar power ITC comes in the form of federal tax credits that you can roll over for up to 10 years. Solar energy storage solutions are also included in this Incentive for those who want to go off-grid.
Can You Earn Money By Installing A Pv System
As you can see, most of the available incentives for solar energy aim to reduce your consumption from the grid and the costs of the PV system. You cannot make money with the Federal Tax Credit or with the Net Metering Schemes.
The Feed-in Tariff scheme is the only option that allows you to earn money with your PV system. However, there are not many utilities that offer you the possibility to access the scheme at residential scale, and the profits will vary a lot according to the project itself, the location, the size of the system, and the price of electricity. SRECs are also another option to obtain money from a PV system, but they are more intended for commercial systems that can easily produce 1 MWh in a year. If you decide to change or get rid of your solar panels, there is some money to be made back by recycling the solar panels and their parts.
Commercial and utility-scale projects can achieve higher earnings with a fixed contract of FiT from a solar farm. Low size PV systems can eventually achieve earnings through this scheme, however, the attraction of solar energy on residential-scale in the US should be seen from a perspective of savings rather than from a making money perspective. To estimate how much you can save with solar energy you can visit the PVWatts tool.
Don’t Miss: Where Should Solar Panels Face