The Solar Efficient Home: cost, savings benefits

A home's energy use is very highly dependent on how the home is built and how the occupants use energy.

The solar home strategy includes
1) Site it, design it and built it to use as little energy as possible,
2) Put in appliances, including HVAC that sip energy,
3) Get people to be careful how they use energy
4) Make some of that energy on site - solar hot water and solar electric.

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1. Assumptions,
If the average WI single family home uses
10,000 kWh/year and
100,000 cubic feet of natural gas

A home built to meet items 1 to 3 and with an efficient natural gas furnace and central AC, could use
6,000 kWh/year and
60,000 cubic feet of natural gas/year

Energy prices (for Madison Gas and Electric residential customers March 2006)
Electricity: $0.12/kWh
Natural Gas: $1.25/therm

2. If you installed an efficient ground sourced heat pump (GSHP) at that home its electricity usage increases and natural gas declines

Roughly
* Assume 36,000 ft3 of natural gas are for space heating
that would become 2750 kWh for heating in a very efficient ground sourced heat pump

* Assume 1000 kWh/year for conventional central cooling
with a very efficient ground sourced heat pump that would become 650 kWh/year

So after the ground sourced heat pump the home uses
24,000 ft3 of natural gas per year
and
8,400 kWh/year

System Cost
Cost difference, between a conventional HVAC system and a GSHP, for a small-home sized system is roughly $4,000 (maybe more). The GSHP costs more. (cost based on NAHB, 2004)

Annual savings
Cost of additional kWhs: 2400 * $0.12/kWh = $290
Savings from natural gas use reduction: 36,000 ft3 (is equal to 365 therms): 365 therms * $1.25/therm (for MGE) = $455/year
Annual savings: $165

Note you may be able to get much better annual savings if you switch to a time of day rate or special GSHP rate.

3. If you installed a solar hot water (SHW) system

Roughly
Assume a standard hot water heater uses 12,000 ft3 of natural gas per year
A solar hot water system should reduce that by 65% to 4,200 ft3 of natural gas per year

System Cost
installed: $8000 (high end)
Federal tax credit: $2000
Focus on Energy Cash Back Reward: $2400 (Wisconsin only)
Final cost: $3600

Annual Savings: 7800 cubic feet of natural gas (or 80 therms) per year
Value: 80 therms/year * $1.25/therm = $100/year

4. If you installed a solar electric system
Say it is a two-kilowatt system (you could go larger or smaller)
It should generate about 2400 kWh/year

System Cost
Installed: $14500 (high end)
Federal tax credit: $2000
Focus on Energy Cash Back Reward: $3600 (Wisconsin only)
Final cost: $8900

Annual Savings:
2400 kWh/year * $0.12/kWh = $290/year

Note, a solar electric system capable of meeting all the home’s electricity needs, 8400 kWh/year, would have a capacity of 7 kW, require 750 cubic feet of roof space, cost about $52,500 installed and $39,000 after incentives.

5. If you do it all, GSHP, SHW and 2 kW Solar Electric System:
Home's final energy usage
6,000 kWh/year
* 60% of the average home (could be further reduced with larger solar electric system)
16,000 cubic feet natural gas per year
* 16% of the average home

Total additional cost: $16,500
Annual savings: $550
Simple Payback Period at today’s energy prices: 30 years

6. Yes the payback is long - but if you are building a 100-year home - in twenty years the world will be looking very different. Today's energy prices remain very cheap. There are many other reasons to go efficient and go solar.