We decided we’d look into getting a rooftop solar power system at our house back when the Inflation Reduction Act passed, locking in a 30% tax credit for installing a rooftop solar energy system. With the generous tax credit, we figured this would be a good time to put the money on the table and reduce our utility bills while doing our part to lower our family’s carbon emissions.
Getting Started
I was reading this City of Phoenix newsletter that comes in the mail. In it, I saw this little blurb about how you can sign up for this free co-op called Solar United Neighbors. Solar United signs up lots of people interested in installing rooftop solar. Once they have enough people signed up, they go out for a collective bid. Using their scaled-up negotiating power, they can get better terms. This is what I liked the most, they do the price negotiating for you.
I signed up for the Solar United Neighbors co-op in early June 2023. By July 15, I got an email from a company called Sunny Energy, who was awarded the bid. I got my contact at Sunny Energy some basic information, like the last couple of years of our SRP utility bill and our address – and he said he’d come back with a bid for what makes the most sense given our roofline, sun exposure and electricity use patterns.
Sizing Your System
We talked about how much capacity we wanted before he came back with a proposed site plan. He explained that if you buy an oversized system it’ll take you longer to get your ‘payback’ – which is basically the number of years it’ll take to make up for your initial solar investment with lower utility bills.
Whenever you’re making more energy than you need at the time you have to sell it back to your utility at fire sale prices. The sell-back prices vary depending on the utility you have and what the AZ Corporation Commission has approved as a buyback rate.
How much SRP will pay you for your extra electricity depends on the plan that you pick. On the Customer Generation and Average Demand price plans the excess energy you make and send back to them is credited to your bill- but that plan comes with a monthly fee. You’ll get back the same value you would have paid for that energy had you purchased it from SRP.
If you pick the TOU Export and EV Export price plans, SRP will credit you just $0.0281 per kWh and subtract it from your bill (that’s a very low rate by the way). Here are the SRP solar price plans | SRP
By comparison, APS pays you $0.076 per kwh for your extra electricity, but they reduce that 10% per year for 10 years. However, the Arizona Corporation Commission has opened the docket to explore dramatically cutting the buyback rate to just $0.053 per kwh, also subject to the 10% per year reduction. See: Corporation Commission Sets Stage to Drastically Cut Rooftop Solar Buyback Rates
Taking into consideration our energy use, the easily useable rooftop space, shade, and other factors, we decided to go with a 9600kW system – 24 panels on top of our garage. So far, we’re on SRP’s Export Plan – which is only paying us about 1/2 the value of the extra electricity we’re making.
How Much Did It Cost?
The initial bid for the 24 panel 9600kW system was $22,000. The federal tax credit is 30% of that total, or $6,600, and with the state tax credit of $1,000, the initial cost of the system would have been $14,500. At the current utility rate for electricity, the 24 panels are expected to reduce our utility bill by about $200/month, meaning that the ‘payback’ for the system would have been about 7 years. We discovered that our very old service panel wouldn’t accommodate the solar system -so we needed a new panel to the tune of $3,000 extra. But that counts toward the tax credit too, so the new panel ended up costing just an extra $2K.
Note: To get the full 30% tax credit you need to have a tax obligation sufficient to cover the installation.
15% of the contract amount was due at signing. The second invoice was for 35% of the contract amount and was due upon design review. The 3rd invoice was also for 35% of the contract amount and was due prior to installation. The final 15% was due after installation and city inspections, but just before SRP comes out to install the new service meter.
Off to the Races
Once all the contracts were signed (about July 20) the whole thing went very fast. Within a couple of days, the Sunny Energy work crew measured everything. They built the plan using the measurements, developed the plan and turned it in to the City of Phoenix and SRP – who need to approve the plan and provide the permits. If you have an HOA, they may need to approve the plan as well. Both the City and SRP approved the plans pretty fast, within a couple of weeks. Note: State law preempts HOAs from unreasonably limiting rooftop solar installation.
Installation of the panels and the inverter (which converts the DC electricity to usable AC current) happened on August 17. Installation was done in about 3 hours from start to finish.
By August 25, just 5 weeks after we signed the contract, we were done except for installing the utility meter.
Inspections
Once the panels are up and the electrical system finished the fire department needs to inspect it. Once they say it’s ok, the city inspector needs to say it’s OK too (give it a green tag). The inspections happened really fast for us. There seems to be some kind of electronic tracking system because whenever one inspection was finished the next one happened right away.
Your contractor will submit a request to your utility company for a “Permission to Operate” your system. For us, that Permission to Operate required the installation of a new meter that will allow for your system to be commissioned.
Commissioning the Utility Meter
A couple days after the city gave their approval (green tag) I got an email from SRP scheduling the installation of the new meter… which was set for just 3 days from notification (September 1). Right after I got the notice from SRP that they’d be installing the new meter on 9/1, Sunny Energy let me know that they’d be out for the final walk-through on September 5.
Day 50: Making Electricity!
The technician arrived for the final walk-through on Sept 5, about 50 days after first contact with Sunny Energy. He hooked the signal generator on the inverter to our home Wi-Fi. The inverter can then send real-time data to you, which helps you see how much energy you’re consuming in the house relative to what you’re generating from the panels.
I was able to get a first reading from the panels at about 3:00pm on this sunny afternoon. It’s simple to log on to see your system. You can even see how well each panel is doing at the moment.
We turned on the system at about 3pm on September 5, a clear day with a high temp of 105F. Even with the A/C units running, we’re still making more power than we’re using. That will change with the time of day, season, and cloud cover – but it sure feels good to be making our own electricity!
That’s our story so far. I highly recommend signing up with Solar United Neighbors to get started and we were pleased with the service, communication and final result we got from Sunny Energy.
