Get Off the Grid: How to Get Solar Panels in California for Cheap

by Tony Chavira

Doesn’t it seem annoying that countries like Germany are investing tons of money to transfer their entire energy systems to solar, while people in the United States still bicker over whether or not climate change is human-caused? Even if you’re not interested in the environmental cause, it makes sense to make your own energy rather than pay someone else for it. That’s what America is all about: actual independence.

Of course, a longing for independence tends to directly confront the huge up-front cost of installing solar panels, and fossil fuel dependence usually wins. Just one photovoltaic (solar) panel, with only a measly 75 watt output (enough for a single lightbulb), can cost up to $900 installed … that’s an insane $12 per watt. If you want to install a three kilowatt system, which should be more than enough for a household of five-ish people, it’s going to run you $24,000-$30,000, once all is said and done. When you see a number like that, no matter how much money you know you’ll save in the future, buying solar panels takes a back seat to other purchases.

But here’s the thing: if you install solar panels you can get rebates from power companies while you pay your power debt down to zero. If you keep paying companies for power, you continue to feed a corrupt, polluting system with no return whatsoever.

To deal with the heavy upfront financial burden, California governor Jerry Brown recently to renewed the California Solar Initiative Rebate Program, which provides rebates for projects in California school districts. I know, it doesn’t have anything to do with you buying solar panels for your home, but consider this: if school districts are buying them in bulk, the cost of individual panels goes way down. Huge institutions have bought bulk sets of solar panels in the past, and the average cost of panels now has dropped dramatically, so they need to keep up the good work.

As for slapping panels on your home, pricing them isn’t too difficult, and affording them doesn’t have to be either. Assume that the total cost will be $30,000. There’s no way in hell you can afford that. You’ve got a few things to do next:

• First, you’ve got to do an audit of how energy efficient your home can be. Maybe you’re wasting a ton of money on air conditioning because your windows are leaking cool air on all sides. Maybe you’ve got a light bulb running all day in an area that gets sunlight. Maybe you leave the TV and a bunch of lights on all night. Maybe you don’t need only two kilowatts per month, thus slicing away a third of your solar cost. Some habits and/or problems can get fixed on the cheap, before you start tossing money at solar panels. Check out this website to lazily estimate how efficient you can be.
• Next, find someone to install the panels. Wouldn’t you know it, the state has a list of certified contractors! You need to find a legitimate one to do this stuff in order to get refunds from power companies like Southern California Edison too. Don’t go to Home Depot and hire someone hanging out at the entrance, and don’t offer the job to your cousin who’s been sitting on his ass in your aunt’s basement and needs the spare cash. Once you get a quote for how much solar will actually cost …
• Apply for rebates, and as many as you can. And you can do that here. It might get tricky here: each rebate depends on a litany of factors, including how efficient the panels are, where you live, and which program you want to utilize. The state breaks them down into two categories:

1. Expected Performance-Based Buydowns (EPBB): This rebate it probably your best bet, since it’s upfront cash for smaller systems (i.e. your house). Basically, it’s a formula that pays you based on how well/efficiently the state expects your solar panels to perform, and only counts for systems that use less than 30 kilowatts per year. Since you’re probably only going to use two kilowatts a month at the most, it’s a pretty sure-fire bet that this is the way to go. You get paid out per watt, and the higher your performance is, the more you’ll get back from the government (with a maximum of $2.50 per watt). If you can get your solar panels to perform perfectly at 3,000 watts, you’ll get a cool $7,500 back in rebates … dropping the cost to $22,500. Which, obviously, is still pricey.
2. Performance Based Incentive (PBI): You can usually opt into this rebate, and if you’re pumping out more than 30 kilowatts, you don’t have a choice. It’s cash out in 60 monthly payments over the course of five years, determined by the actual amount of energy you produce. The idea here is that systems that make more power get more cash back. It’s also measured in kilowatt hours (how much power you produce for however long you leave the panels out in the sun), and maxes out at $0.39 per kilowatt hour. Since a regular “150 watt” panel produces about one kWh every day (on average) it would take 20 to power your home. That’s a daily rebate of about $7.80, $2,847 per year, and $14,235 total in the very best case scenario. Now the total cost of installing the panels has dropped to $15,765. Which, obviously, still isn’t cheap enough.

After that, you pay to install the panels and bammo … the rebate cash starts rolling in.

But if your average monthly power bill is $100 per month, you’re paying $6,000 for power every five years. So paying $15,765 (in the best possible scenario) for five years of solar power still isn’t much of a deal. That means we need to find another way to figure, and you have two options:

• Buy cheaper solar panels: Thin film panels are sold by companies like First Solar, Nanosolar, and AVA Solar, and are only recently becoming available for homes. The thinner technology drops the price of the whole system and installation to about two bucks per watt … which means you can cover your power requirements for less (something between $6,000 and $8,000 all-inclusive). If you include the full EPBB rebate (and your panels have a really high power output), you may end up paying next to nothing for your panels. Hallelujah.
• Or hunt for more rebates: There’s a Federal Tax Credit of 30% of the system cost (so, for example, $10,000 of the $30,000 it costs), with no limit for residential installations. So that drops the total price to $20,000, and if you use the PBI incentive, you’ll end up paying something like $5,735 total. Definitely worth it, since now it’s cheaper than buying $6,000 worth of coal power over 5 years. Here’s a link for how to get that tax credit.

Remember that these numbers are speculative, for the most part, based on what the programs promise on California and federal government websites, so you may have to hunt some experts down to get all the nitty-gritty details explained.

But one thing is for sure: energy will cost more in the future if you keep buying it from energy companies, and less if you buy your own solar panels. In ten years, we may not see the price of solar panels go down, but we’ll definitely see the cost of fossil-fuel power go up. You can cash in on the solar rebate system while it’s available, or get stuck footing the bill in ten years when you’re paying $300+ a month for power.

Good luck and Godspeed!

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