by Laura Combs, ESL Business Development Director

For those considering investing in solar energy for their business, non-profit or home, really thinking about and understanding what solar panels can do for you can be confusing. If you are like I was, you think that solar energy is a great idea but you can’t quite see how it actually benefits you financially. Few people are fluent in kilowatts (kW), kilowatt hours (kWh), demand charges and other energy terms, and most of us definitely don’t think about them every day or even once a year. They are something reported on our electricity bills to be glanced over as we get to the bottom line. But they matter!

Your Bill

While most of us just focus on the final figure, it’s important to understand the terms.

For residential, it’s relatively easy. We are assessed fixed charges (monthly fee or rider – most frequently a REPS or Renewable Energy Portfolio Standard rider) and the variable or volume charge, which relates to the amount of energy you use and is shown as kilowatt hours on your bill. Kilowatt hours can vary dramatically month-to-month depending on how much energy your house consumes. You can see a sample residential Duke Energy bill here: Reading Your Residential Bill. We encourage all of our customers to read their applicable rate schedule (an explanation of fixed and variable charges), which you can view here: North Carolina Index of Rate Schedules. Dividing the total amount of the bill by the number of kilowatt hours used will give you the “blended” rate of what you pay; it is a blend of the fixed and kilowatt hour cost.  Keep in mind that your fixed rates are going to stay the same each month (unless the Utility Commission allows Duke to change them), and your kilowatt hour use will vary based on what you actually use. The blended rate serves as the baseline when determining how solar energy offsets your monthly electricity charges.

Commercial customer’s bills are more complicated because the utility assesses the fixed charges, the variable kilowatt hour charge, as well as a “demand” charge. The demand charge is the fee determined by the highest amount of power drawn from the grid during any interval (typically 15 minutes) during the billing period. A sample Duke Energy bill is here: Reading Your Business Bill.

For some commercial rates, such as Medium General Service (MGS), kilowatt hour costs are fixed/not variable ($.0706 per kWh), and the same for the demand charge ($5.86 per kW).

The rate is tiered for some types of customers, such as Small General Service (SGS), which is the rate for many small churches. This means that the more kilowatt hours that you use, the lower the cost per kilowatt hour. For example, for SGS the first 750 kWh is the most expensive at over $.10 per kWh, but the price drops as more kilowatt hours are consumed. And there are even more complicated rate structures!

Don’t worry about understanding it all now - we can help you figure it out. But understanding how you are charged for energy at home and at your business can help you understand how to reduce your costs.  Solar is one such way - so how does it do that?

The Solar Panel

Let’s start at the solar energy baseline – the solar panel. Solar panel output is measured in watts (W). A premium, new, fixed solar panel produces between 300W and 400W per hour, depending on the manufacturer, the model, the location and the weather. North Carolina averages about 4.5 hours of peak, usable solar energy per day. If your home or business is unshaded and the panels are facing south and weather conditions are optimal, a panel will produce approximately 1.4kWh per day for every solar panel installed.

Another way to think about it is in kilowatts – which is the measurement that you find on your business account bill. A 10kW solar panel system (between 25-35 panels depending on the manufacturer) will produce about 14,000 kWh a year. A good rule of thumb is that for every kilowatt of solar you install in North Carolina, approximately 1,400 kWh are generated with ideal conditions. A kilowatt hour production estimate for your system, worthy of another blog post, is based on weather data coupled with technical data of the specific panel, as well as the orientation of the building. The estimate is critical to understanding how a solar energy system will impact your bill.

Net Metering

Fortunately for everyone, the North Carolina Utilities Commission requires Net Metering from Duke Energy, as it has been shown to benefit all customers. Here’s how that works: Let’s say you decide to put a system on your home, place of worship or business, but you are generally out of the building during normal business hours. What happens to those unused kilowatt hours generated by your solar panels?  Because your system is producing kilowatt hours every sunny day, if you are not there to consume them all, the kilowatt hours will flow directly to the electricity grid! This is where Net Metering comes into the equation. Net metering can get a bit complicated, but at its most basic, it describes a billing mechanism between a utility and a customer who is self-generating power. It involves a bi-directional meter that registers when 1) a customer consumes utility grid-supplied power and 2) when their self-generating system is supplying power back to the grid. When the meter is spinning backwards (Yay!) utilities will often credit solar customers for these kilowatt hours at the retail rate, which is the same rate at which you purchase it.

Putting it All Together

Energy use by homes and businesses can vary for a number of reasons, and as we discussed, rate structures for businesses add another layer of complication. We do know that when you install solar, you may purchase significantly less kilowatt hours from Duke Energy and, therefore, save money!

If you have a business that primarily operates during the day, you will also see a reduction in your peak demand charge because your solar panels will be producing and offsetting your maximum energy draw from the utility grid. A school, for example, can see upwards of a 30% reduction in its demand charges because the school’s peak demand is likely when the sun is producing!

If your business has a fairly constant load or demand that is higher in the evening - think hotels/hospitals - or facilities that operate 24 hours a day, seven days a week - solar is not going to have a dramatic impact on demand because your “peak demand” may be at a time when the solar panels aren’t producing and are unable to offset your power draw from the grid. That said, you will likely be able to take advantage of net metering and your system will pay for itself and save you money.

In summary, every kilowatt hour matters! Before investing in solar technology, we recommend reducing your energy consumption. Harvard University has great recommendations here: Top 5 Steps to Reduce Your Energy Consumption. When you are ready to invest in your own green energy power plant, we are here to help you think through your choices.

If you have any questions, please feel free to reach out. Thank you for reading!

Laura Combs

lcombs@eaglesolarandlight.com and (919) 275-2245

Laura Combs is Eagle Solar & Light’s Business Development Director in North Carolina. She has a Master’s degree in Urban and Regional Planning, with a specialty in Environmental Planning. Laura is a former environmental non-profit employee who worked to recover the endangered Florida manatee, is very aware of the need for maintaining slim overhead and maximizing funds, and she is very grateful to bring her knowledge and skills to Eagle Solar & Light and its customers.

By Kathy Henderson, Sr. Sales Engineer

Another Earth Day is upon us and hopefully most of us are asking ourselves, “What am I doing to make this blue planet as beautiful for my children as it has been for me and those before me?” Ever since my children were about four, we used every Earth Day as an opportunity to walk around our neighborhood and clean up trash. It felt good. I was not only making for a more aesthetically beautiful place to live but I was also teaching my children important lessons: not only is it important not to litter but it’s our responsibility to not just complain, but to actually do something about it. “Be the change you want to see in this world,” –Gandhi (although I’ve been told this is a rephrasing of several things Gandhi said and not a direct quote.)

As my children grew older, we were inundated with news reports, articles and television shows about dying coral reefs, melting glaciers and disappearing rainforests. It broke our hearts. We continued to recycle, clean up litter from rivers and waterways, and do “our part,” and not just on Earth Day. But it still didn’t seem like enough. I needed my children to know their mother wanted to be a part of a bigger change. So, after leaving the engineering world more than a decade before to raise my kids, I returned to graduate school to learn about sustainability. It has been one of the most fascinating and insightful things I have done in my life. I went into the class not really knowing much about the term “sustainability,” but the concept is fairly simple. God has given us this amazing planet with resources to help us live productive and fruitful lives.

We have two choices:

  1. Use them until they run out (which almost happened to the forests of Great Britain in the 1500’s) and then hope we find another resource that can do the same thing, which has been pretty much our modus operandi for the last 2,000 years.
  2. Take 2,000 years of human knowledge to understand better how to minimally use these resources so they can last for generations to come.

But there is one resource that we know will be around for at least another five billion years – our wonderful sun. This “yellow dwarf” provides warmth, energy, light and all things good. And after decades of improving technology, its light now gives us direct power.

So that’s where Earth Day led me, to a group of people who wanted to make a change in this world by educating and supplying people with one of the lowest emission forms of energy – solar photovoltaics. This technology has been around for over 80 years and was actually contributed to by the works of Albert Einstein. But over the past decade, it has become cleaner, more efficient and more accessible. It brings me hope that every solar system we install gives future generations a chance to see a blue planet that is healthy and thriving.

At Eagle Solar and Light, in three years we’ve installed almost 2MW of solar power, equivalent to over 1.3 million planted trees and mitigated 50,000 metric tons of carbon dioxide emissions over the life of the systems. And we’ve only just begun. That is only a very small portion of solar in the world. With companies such as Disney, Amazon, Google, Wal-mart, General Motors, Volkswagen, IKEA, Costco and more relying on solar power, it has proven to have taken the energy market by storm.

But don’t get me wrong, this technology is not at its end. It will continue to improve, along with other renewable energy sources such as wind, tidal, geothermal, hydro-electric and wave energy. And honestly, I hope one day we can reach the zenith of clean energy – fusion. But for now, I go into this Earth Day knowing our team is bringing the hope of a greener, cleaner, and healthier tomorrow.

Kathy Henderson, Sr. Sales Engineer, wife and mother of two hopeful children

One of the greatest parts of working in the solar industry is the people that you meet. As our work in North Carolina has expanded, we have been thrilled to learn about the Community Purchasing Alliance (CPA). The Community Purchasing Alliance has changed the way that schools and churches think about their utilities, service contracts and vendor relationships. They are helping non-profits stretch their limited time and financial resources.

Felipe Witchger, Founder and Executive Director of the CPA is a visionary with a passion for helping non-profits focus on their mission and extend their resources. Hear Felipe speak at our upcoming “Save Money and Make a Difference!” Nonprofit Sustainability Event March 20th in Durham, NC! Click here to register. You will learn about how non-profits are making their dollars go farther with CPA’s innovative financing model and other pertinent topics.

Community Purchasing Alliance and Bulk Purchasing of Critical Services

The CPA negotiates significant savings for their non-profit members by negotiating contracts and vendor relationships that wouldn’t be available otherwise. Solar energy, Heating, Ventilation, Air Conditioning (HVAC) services, and printers are all products that CPA has facilitated special pricing arrangements for its cooperative members.

The Community Purchasing Alliance: Saving Money for Non-Profits The Community Purchasing Alliance: Saving Money for Non-Profits eaglesolar March 13, 2019 Renewable Energy / Sustainability One of the greatest parts of working in the solar industry is the people that you meet. As our work in North Carolina has expanded, we have been thrilled to learn about the Community Purchasing Alliance (CPA). The Community Purchasing Alliance has changed the way that schools and churches think about their utilities, service contracts and vendor relationships. They are helping non-profits stretch their limited time and financial resources. Felipe Witchger, Founder and Executive Director of the CPA is a visionary with a passion for helping non-profits focus on their mission and extend their resources. Hear Felipe speak at our upcoming “Save Money and Make a Difference!” Nonprofit Sustainability Event March 20th in Durham, NC! Click here to register. You will learn about how non-profits are making their dollars go farther with CPA’s innovative financing model and other pertinent topics. Community Purchasing Alliance and Bulk Purchasing of Critical Services The CPA negotiates significant savings for their non-profit members by negotiating contracts and vendor relationships that wouldn’t be available otherwise. Solar energy, Heating, Ventilation, Air Conditioning (HVAC) services, and printers are all products that CPA has facilitated special pricing arrangements for its cooperative members. See How Temple Sinai Benefitted from Solar through the CPA CPA successfully negotiated $16.9 million of bulk purchase agreements in 2018 for a total of $1.5 in savings for its members. These bulk-purchase arrangements are driven by specific needs and opportunities for savings, and these final agreements are the result of robust financial analysis, intensive due diligence, and significant input from the coop members on their most pressing needs. For example, CPA and its members determined that it could save 10-30% on HVAC services through a bulk-purchased contract. CPA is replicating this successful model in the Research Triangle Park area now, after significant success in Washington DC.

Learn more about the CPA and Solar Power for Nonprofits

Join us in Durham at Clouds Brewing to learn more about how your nonprofit can raise more money and save money. This event is going to focus on a variety of strategies that nonprofits can employ to get the most out of every dollar. Reserve your spot today! When: March 20th, 5:30-7:00 pm Where: Clouds Brewery, 905 West Main Street #22, Durham, NC 27701