Finally getting around to building the garage for my house 20 years on. I had three goals for my garage: that it be used for a car, that it has a workshop and that it gets solar power.
The car bit is because I’ve seen too many garages not used for cars. Also EVs can be tasty treats, in certain circumstances, for rodents. And since I also wanted a workshop I needed to design space for both - which meant a wide garage.
This made the solar power part a bit easier. Love it when requirements reinforce each other!
I did a lot of research into various aspects of the garage over the years. I have a lot of ideas on setting up my workshop and what to do with the space around the garage and between the garage and my house. I also researched solar and there was a recurring strain of info I kept reading on solar: The Payback Period.
The idea here is that you pay X for the solar PV setup (possibly including a battery). You then calculate how long it takes to get save X amount once the system is running.
I find these conversations to be hilarious. If it helps people justify buying a solar PV system, that’s fine. Enjoy your spreadsheet. But it’s not why I’m doing this. So let’s explore why it’s hilarious and then some other reasons for getting a solar PV system.
Payback Period Hilarity
Why is this hilarious? Because it depends on a huge number of variables. You have the ongoing cost of electricity, how much you use, feed in tariff variability, system reliability and more. At a larger scale - say you’re doing it for hundreds of thousands of households in a jurisdiction - these variables become less of an issue. For one house though, the math will likely not predict the outcome.
Past electricity prices might not be a guide to future electricity prices. There are lots of reasons to expect electricity prices to change in ways they haven’t before. Carbon taxes, demand pricing, environmental policies - all of these might raise or lower electricity prices a significant amount. What if the government gave houses with a A BER cert a 10% discount on electricity as part of a programme to encourage upgrading homes? That would mess with payback period if you had an A rated house.
There’s a lot of discussion about demand pricing. Here in Ireland they’re rolling out smart meters that will allow for demand pricing. If you buy a batter backed solar system you might be able to game this - assuming your system is compatible.
Last year I purchased one of the most efficient EVs available. This year I put a deposit down on an EV that is twice as efficient. I calculated that a full year of commuting would cost 5 MWh/year - equal to what my house consumes per year. Once I get this car, that goes down to 2.5 MWh/year. And all that was before COVID - my annual energy usage with my car this year was 1,600 kWh/year. Obviously being home increased energy usage a bit, but not by that much. Those are pretty massive swings in energy usage.
And you might argue that COVID is a once in a lifetime thing, but I have friends who have lost loads of time at work due to accidents or illnesses. Plus post-COVID remote jobs are much more possible.
Electricity companies around the globe are trying out various ways to do feed-in tariffs. Likewise governments around the globe are trying out various ways to subsidise - or penalise - micro-generation. In Ireland I’m allowed to send 6kW back to the grid and for that they’ll pay me the princely sum of 0 cent. There’s a consultation document to change that but in it, Eirgrid says that if there’s widespread adoption of microgeneration in rural areas they won’t be able to take more than 4 kWh. They also say they might be making changes that allow them to take 50 kWh. Those are a lot of scenarios to game out. Which of them is likely? No idea.
Lastly is reliability of these systems. Lots come with cloud software monitoring. How long will that be supported? What happens if that falls over? No idea. I have friends with systems where it’s taken months to fix battery management issues. Just how long will a solar inverter last? Every Payback Period calculation I’ve seen implies 100% uptime. That in itself is hilarious.
The first is similar to the payback argument. A solar PV system reduces my variable expenses as I get older so it helps to firm up retirement planning. Retirement planning is another one of those things with too many variables to really be done reliably for an individual. Every element of retirement planning is designed to reduce that uncertainty but you can never get it down to zero - well, until you die.
A solar PV system will fix the price for some fraction of your energy use. All the reasons Payback Period obsessions are silly apply here, but you’re not aiming for a specific number. You’re just trying to mitigate risk here by diversifying your risk. It’s one small tool in that toolbox. And that’s important to keep in mind - it’s a small part of retirement planning. If you haven’t saved up for a pension or done other investments for retirement, this isn’t where I’d suggest starting.
Another argument for solar PV is reliability. Where I live the grid has a number of outages every year. I’m hoping to use my system to increase reliability. It will be setup so I can bypass it if it goes down. Annoyingly this first pass won’t let me automatically fall over to my system but it will in the future. There will be a learning curve to this and I’m in a position to start learning.
Lastly I’m a software developer. I think it would be interesting to get data from my PV system, my heating system, my car, internal air quality sensors, the HRV system and weather data and use that to make my house more efficient and/or nicer to live in. So if CO2 is rising a huge amount it likely means I have guests so make sure to turn up the HRV to swap air out of the house quicker. If the guests are still there at night, boost the temp for the hot water, etc.