Solar and Wind FAQs

Our phones have been ringing off the hook with people in Kansas City, St. Louis and all over the midwest trying to learn more about solar and wind energy, and the availability of financial incentives. The vast majority of these calls are from people wanting to install either a solar or wind system and trying to understand what it takes to get started. We put together some of the most common questions and answers.

First, let us tell you it's our commitment to provide honest, accurate and factual responses to all questions and requests for information. We're proud to tell people we say what we do and do what we say.

General - Getting Started | Utility Co. Payback | Incentives | Permits needed
Solar - Start up costs for PV | PV Payback | Air and Home Heating | Hot Water Systems
Wind –Is Wind practical?


Q: What do I need to get started? How do I determine the size of system required and how much energy will it produce?

A: For an existing home or building our first step is to review your last 12 months of electric bills. The square footage of a home or building is not necessarily related to energy usage, which is why it is important to review the bills. For new construction or renovations we review plans and recommend energy modeling by an independent consultant such as Butterfly Energy Works in St. Louis or Hathmore Technologies in Kansas City. With this information, we are able to calculate system size, and estimate energy production. We also recommend approaches to reduce energy consumption and other energy efficiency measures available through companies we collaborate with.

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Q: Will my utility pay me for the excess power I produce?

A: The states of Missouri and Illinois have a form of "Net Metering" laws in place. The new Missouri law took effect January 1, 2008 and provides credits for the excess energy produced. The credits produced can be used to pay your electric bill in a given month. In Illinois, net metering is available to electric customers that generate electricity using solar energy and wind energy.

Systems up to 40 kilowatts (kW) in capacity that are intended primarily to offset the customer's own electrical requirements are eligible.* While Illinois's investor-owned utilities and alternative retail electricity suppliers must offer net metering, the state's municipal utilities and electric cooperatives are generally not required to do so.

Kansas has no Net Metering law on the books. However, KCPL has implemented a program similar to the Missouri program for its Kansas service area. Other utilities pay an avoided cost rate for excess power on a volunteer basis.

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Question: How do I keep up with the different financial incentives available for renewable energy?

A: The financial incentives are indeed changing all the time, with new incentives being added, others being modified, and a few that are expiring. The Database of State Incentives for Renewable Energy contains details for financial incentives at both the federal and state level, including incentives for energy efficiency.

Read more about this in Success Stories.

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Q: What types of permits are involved to install a Solar or Wind System to generate electricity?

A: All cities and most counties require an electrical permit be obtained before a system is installed. The system must be installed in accordance with local electrical code requirements, which are often based on the National Electric Code. In addition, the local utility will require a interconnection and net metering agreement be put in place. The local permitting authority will inspect the system to ensure it was installed in accordance with local codes. In some case the fire marshal will inspect as well. All utilities require the system be inspected by a licensed engineer or electrician. (The Energy Savings Store is a fully licensed contractor and can fulfill these requirements.)

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Q: What does it cost to install a Solar PV system and will it generate all my electricity?

A: For a Solar PV system tied to the traditional electrical grid, we generally figure a cost per watt. For example, a solar panel system that will create 3,000 watts of electricity will cost between $8 and $9 per watt in equipment and installation costs. A 3,000 watt system would be between $24,000 before taxes. This system would produce approximately 3,800 Kilowatt Hours (KWH) power annually. Assuming a home uses 10,000 KWH a year, this level of power production would offset 38% of the usage.

More about financial incentives in Success Stories.

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Q: What is my payback period for installing a Solar PV system?

A: The answer to this question depends upon the following:
• Escalating cost of electrical energy in your area;
• Net-metering program for your area;
• Federal investment tax credit, currently 30% for business and residential;
• Rebates or Grants that may be offered at the state or Federal level;
• Net Present Value of adding an energy producing asset to your home or business;
• Local real estate market demand for sustainable or "green" features;
For each of our clients, we provide you with a financial analysis for your project that is in a form that can be reviewed with a trusted financial adviser. Two "Real World" examples:
• Residential 3 KW System 12- 15 Year Payback Period
• Farm 6.8 KW System 10 Year Payback Period, with Internal Rate of Return 9.1%
Using the following assumptions for a 3.0 KW Solar PV Residential System and a traditional payback analysis approach:
• System cost of $24,000;
• Annual energy production of 3,937 KWH for a grid tied system
• Electric rate of $0.10KWH;
• Annual electric rate increase of 6.5%;
• Federal Solar Tax credit of 30% is applicable after January 1, 2009;
• Renewable energy credit certificate of $0.03 per KWH;
Simple Payback Period of 15 Years with an Internal Rate of Return of 6.5%.
Missouri's Proposition C passes and is schedule to be enacted by January 1, 2010, a $2.00/ watt incentive would exist for investor owned utility customers in Missouri.
Installing a renewable energy system will add value to the home. Real estate appraiser studies have shown that a home that implements energy efficiency improvement will increase in value by $20 for each $1 saved in energy efficiency improvements.

A 3 KW system that produces 3,937 KWH a year, saves $393.70 in electric cost; $393.70 x $20 results in $7,874 increase in home value. The payback period improves to 9.9 years with an Internal Rate of Return of 13.4%!

The payback periods and Internal Rates of Return for Solar Hot Water and Solar Air Heating are much shorter.

Commercial and industrial financial returns are shorter as well.

We have more information about financial incentives in Success Stories.

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Q: How can I heat my home or water with Solar Power?

A: Solar Air Heating or Solar Hot Water Heating Systems can assist in heating your home. These panels use a kind of technology that is different than the ones that produce electricity (photovoltaic or PV). Solar air and water panels capture the heat from the sun on their surface and then transfer the heat either to a holding tank, in the case of hot water, or directly vent the heated air into a room. In some cases you can place a heat exchanger in your furnaces' cold air return.

Solar PV Panels and batteries should not be used to run electric or resistive heating elements. There are a few applications of large wind turbines which may have an element to produce heat. This type of application should be evaluated closely.

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Q: I am interested in installing a solar hot water system, how big of system do I need?

A: Sizing a solar hot water heating system is based on the number of occupants of the home. The average person uses 20 gallons of hot water per day. In the case of a home occupied by 4 people, a system capable of heating 80 gallons of water is required.

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Q: We are interested in installing a wind turbine and it is always windy on our property. Is it practical to install a wind turbine?

A: It is important to understand the average annual wind speed in an area and how it correlates to monthly energy production in KWH. For example, a Southwest Windpower Skystream 3.7 will produce approximately 250 KWH of power per month if the wind averages 10 mph. However, at 12 mph the power production is 400 KWH of power per month, a 60% increase. Compare the production level to your monthly energy usage and you will understand your offset. For most situations, we recommend installing a wind turbine if your average annual wind speed is greater than 12 mph.

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