Moar solar!

[marsden_online]

A couple of weeks ago mow the NZ Herald had this article on a new eco-showhome built with the intention of selling electricity back to the grid. In it the architect made some claims about how-much money could potentially be made from retrofitting an existing house, which were sort-of challenged by a a followup article the next week

But McAll claimed far more money could be generated.

"A retired couple in a small two-bedroom home with $60,000 spare cash could generate an income of about $600-$800 a month to supplement their pension," he said, citing European examples where people owned electric cars, had no fuel bills and generated an income.

Mike Scaife of Wellington challenged the claim, saying it was impossible to achieve an income level this high.

"My evidence is simple maths and knowledge of solar installation prices and costs," he said, predicting the European experience would never be available to Kiwis.

"A large percentage of the power generation here is owned by the Government which stands to potentially lose income if this ever takes off.

Mr Scaife sounds a little bitter, but I like him because his motivation for installing solar is almost word-for-word my reason for buying the Prius years ago, just substitute "petrol" for "power":

"I am not doing this because of any incentives, but just to stick my finger at the power companies and their ever-increasing charges; [...]" Scaife said.

Anyway since solar is one of my big kicks after reading the first article I went off and had a poke around the electricity companies to see what they were offering in the way of options. Unsurprisingly Meridian seems to be the only one with any traction in this area.

I wound up on the Ministry of Economic Development website, where I downloaded and read this 2009 report on the future costs and performance of solar photovoltaic technologies in New Zealand.

Points I noted
- The "average" NZ household (7800 kWh/year - comp. we've used ~6900kW so far this year) ) would require a system generating in the range 6kWp - 7.5 (kiloWatts at peak) system (depending a lot on where you are in the country). Most household installations are currently in the range 1-3 kWp
- the 6kw requires ~50m2 of roof space. (house has ~120m2 floor area, roof is tilted so that would be greater, but only ~25% oriented appropriately?)
- module cost is/was in the range of $US 6-10 per Wp (note no k) .
- installation cost for a medium system (2-10kW) ~ $US 8.00
- "Rules are defined for generation with capacity above and below 10kW,
effectively ensuring that all generation under 10kWp can be connected, provided it meets the
appropriate standards. Generation above 10kWp may require assessment of required network
upgrades/changes the cost of which may be borne by the generator. "

Actually selling the excess:

7.7.4 Electricity Buyback Arrangements
Distributed electricity generators in New Zealand can sell electricity back to the grid. However, under New Zealand law, they must comply with the rules, including the requirements that all generation that is injected into the grid is reported to the reconciliation facility for the market on a monthly basis and that generators obtain certification that their (metering) processes are robust and accurate.
Compliance with the rules imposes significant cost and is therefore appropriate for large generators only.
Alternatively, generators can sell electricity to the retailer, rather than directly into the market through the clearing manager, and compliance will be dealt with by the retailer. These requirements effectively limit a small generator to conditions negotiated with the retailer. This raises a few issues:
1) There is no obligation for an electricity retailer to purchase electricity from the owner of a micro scale generator.
2) There are no pricing principles (and perhaps, limited incentives) to ensure that prices offered by retailers are fair to both parties.
3) Owners of micro scale generation do not have a low cost means of receiving the wholesale
market clearing price if they cannot agree an acceptable price from a retailer.
Some retailers offer net billing, but net metering, which is widely used internationally as a means of valuing network benefits and is mandated in most US States, is a breach of current New Zealand regulations. However, the more important aspect at present is that the current market conditions do not encourage small generators to sell excess electricity.
Any payment received for electricity exported to the grid is liable for income tax.

- grid parity (when the cost of electricity from solar PV reaches that of prevailing retail electricity) is expected in 2020, but this could be rapidly tilted by the addition of government incentives, higher than predicted electricity price rises or a faster than predicted drop in the cost of installation.

Conclusion:
PV efficiencies are only going to go up, installation cost are probably only going to go down, and I don't really have $30k to throw at this, but it's probably still worth talking to Meridian and getting a better idea of just what it would take.

What I'd really like to do is get a whole lot of home-owners on board and set up a small local generation company subsidising installation, but I think government regulation would make that infeasible. Also as long as the main way to sell is back to the retailer at retail price there's little incentive to sell to the grid at spot price which is typically lower in summer anyway (and I don't forsee much if any surplus/household in winter).