Calculating the Economics of a solar power system
Solar Power shoppers always want to know how to size a system and the output of a system to eliminate their entire bill. Today we’ll cover how to calculate the economics of solar photovoltaic panels. First we need to start with your electric bill so go grab it and have it in front of you, and find out how many kWh (kilowatt hours) you are averaging per month.
For example, your bill indicates you are averaging 600 kWh a month.
————– = 20 kWh / day
Step 2 – Calculating the size of solar panel array you will need
To figure out how many square meters of solar panels we will need to eliminate your usage. A solar insolation map will be needed to see how much sunlight falls on your south facing surface. Use the one below to find your area
For our example, lets use an insolation of 5 sq. meters of sunlight / day
—————————————————— = 33 sq. meters of panels
5 sq. meters/day * 0.12 efficiency
The efficiency number can be obtained from any solar panel specification sheet, the efficiency of solar panels range depending on the solar panel you purchase, so if you are looking for accuracy, find the spec sheet and plug in a real efficiency number in your calculation.
Step 3 – Output of the system
Now that you know how many sq. feet of solar panels you will need lets calculate how many kW (kilowatts) of solar power will the system output for you.
0.12 efficiency of solar panel * 33 sq. meters = 3.96 peak kW
Step 4 – Cost of electricity over the life of the system.
Now you will need to figure out how much you are being charged per kWh by looking at your bill…depending on where you are planning to install the solar power system, your cost per kWh can range, it can be very cheap to highly expensive. In the United States the cost per kWh ranges from .04 cents per kWh to higher than .20 cents per kWh. The MSRP for a 3.96 kW system is about $35,000 dollars, so lastly lets calculate the how much a solar power system would cost per kWh through its lifetime.
$35,000 MSRP cost of system
——————————————————————— = 0.16 per kWh
20 kWh * 365 days * 30 years system life
There you have a short 101 course on how to calculate the money factor for a solar power system. Go ahead, calculate your own requirements and see if solar power makes sense in your area. I’d like to see if solar power is competitive to your electric company in your area. Looking forward to your comments!