Clean solar electricity and solar hot water system installed on a home in Porter, Maine

Many people ask us how solar affects a home’s resale value.  The quick answer – solar can be a huge asset when it comes time to sell your home, though there are a variety of considerations you should take into account.

Lower Utility Costs Equal Increased Value

Let’s look at the purely rational economics of a solar energy system.

In the 1998 Evidence of Rational Market Valuations for Home Energy Efficiency report (link, PDF Download) by The Appraisal Journal there’s a section they call the “Rational Market Hypothesis” which describes the relationship of market value to energy savings.

Using fixed (and very conservative) utility costs savings, compared to the cost of the investment, they are able to project an economic value for energy improvements:

Fuel costs may be considered just one of many complex factors affecting the decision to buy a home, but the same can be said about other determinants of home value—from number of bedrooms to the quality of local schools. In a rational, competitive market, the value of energy efficiency, like the value of any other housing characteristic, should reflect its marginal value to home buyers. If home buyers expect stable fuel prices, then the marginal value of energy efficiency in recent years should be $10–$25 for every dollar reduction in annual fuel bills. (emphasis added)

Note that this 1998 report reflects a very different energy situation than what we face today.  We would now argue that the $10–$25 value increase per dollar of reduction in annual fuel bills is only a starting place, as home buyers should NOT expect stable fuel prices for the future.

Over the life of a 30 year mortgage, the fuel cost/utility savings will rise dramatically as fossil fuel heating and energy resources become increasingly scarce.

In addition, purchasing solar electric is particularly attractive right now because solar panel prices have reached record lows, so the payback time is greatly reduced.

Solar as an Attractive House Feature

There is huge emotional value to a solar hot water or solar power installation in addition to the purely logical economic argument.  A renewable energy system makes a strong statement about your commitment to sustainability and the environment, which is increasingly desirable in the marketplace.

In a down market, a solar system may be the differentiator that makes your house attractive to potential buyers.

An recent article on sunpluggers.com featured a subdivision in Northern California that is using solar panels in its homes as a way to differentiate itself.

How successful is it?

“We are the bestselling project in the market right now,” [Hal Woods, president of privately owned CenterStone Communities] says. “All of our Phase 1 and Phase 2 are sold out. We expect to have the project complete in the spring of 2010. A number of other builders are scouting us and looking at the success that we’ve had.”

While the attractiveness of a solar system will vary depending on your location and potential buying pool, it stands to reason that interest and excitement about renewable energy will only grow in the future as the need to move away from fossil fuels becomes more critical, and all things “green” become more mainstream.

Both solar hot water and solar electricity are proven, mature technologies that will provide a payback for you as long as you live in your home, and a more competitive position should you need to sell your home.

Like all investments, the earlier you put solar on your house, the sooner you will reap the rewards.  As we sometimes say, payback doesn’t actually start until the system is installed!

We put a lot of effort into ensuring our systems will operate trouble-free in New England winters for 20+ years, which is no small feat!  Exceptional manufacturers help make this a reality.

We recently learned that one of the manufacturers we use for solar electric panels, Canadian Solar, received some of the highest rankings in PV USA (PTC) rankings.

These rankings, required by the State of California, exhaustively test module performance in laboratory settings and are required for a module to be eligible for California’s solar financial incentives.

Five of Canadian Solar’s solar module series, the CS6P- 220P, 225P, 230P, CS5P-240M and CS5A-180M obtained rankings that were near the top of all of those tested.

You can read Canadian Solar’s official statement, or see the full listing of PTC rankings and requirements.

Here are some pictures of recent installations that use Canadian Solar panels:

ReVision’s New Hampshire branch manager, Will Kessler, recently captured this piece of stop motion footage which shows you the process of a solar hot water system and solar electric system coming together on a house in Eliot, Maine!

Watch for the photovoltaic (PV) panels coming in along the top – the solar hot water system consists of the tubes below.

This system will save nearly 300,000 lbs of C02 emissions during its first 30-years of service life.

In addition to not burning oil in over a year, this house now generates 4.4 KW of grid-tied solar power!

This past week ReVision Energy installed a 4.4 kw grid tied photovoltaic system on a customer’s home in New Durham, New Hampshire.

The solar power array, comprised of 21 Sunpower modules, uses a Sunframe rail system which eliminates gaps between the panels and leaves a beautiful finish on the rooftop.

This customer already has in place a wood boiler and a flat plate solar hot water system. The solar electric array we installed completes his full suite of renewable energy systems.

He says he burns about 4 cords of wood a year and has not used any oil in well over a year!

More Images From Our Photo Gallery:

Wall Street Journal journalist Gwendolyn Bounds wrote a story on solar hot water for homeowners – what the technology is like, how it works, and the quite impressive economics of investing in solar hot water.

Rather than tackling the environmental benefits of drastically reducing your oil consumption (since in many homes, a solar hot water system can eliminate boiler usage during summertime), the article focused on the great economic incentives for installing solar hot water.

In Maine, these incentives include a $1000 rebate from Efficiency Maine, as well as a 30% tax credit offered by the federal government.

This economics over environment approach is increasingly common – indeed, it’s consistent with the approach Obama took in the State of the Union – and seems to be steering the minds even of those still skeptical of global warming.

Bounds writes:

In the average home, harnessing the sun’s free energy for daily hot-water needs can be a more practical and affordable bet [than solar electricity]. Water-heating is the third-largest energy expense in most households, after space heating and air-conditioning, according to the U.S. Department of Energy. This year, Hawaii began mandating solar water heaters in most new homes, and cold-weather locales such as New York and Colorado are among the state leaders in installations.

A misconception in Maine is that it is too cold for solar, a fact that is totally untrue! In fact, Maine is far sunnier than Germany, the world-leader in solar installations. Today, a gray January day in Maine, our solar hot water tank at the shop reads a toasty 138 degrees.

Whether your motivations are environmentally or economically driven (or better yet, both!) we appreciate the Wall Street Journal’s efforts in presenting the facts about solar hot water to homeowners.

If you’d like some more information on the technology for yourself, take a look at our solar hot water page or contact us to talk about a free site evaluation at your home or business.

This 6KW grid-tied photovoltaic system will produce roughly 7800KWhrs of clean electricity per year and reduce CO2 emissions by 10,452 lbs.

Solarbuzz just released a report on solar panel prices for early 2010. The exciting news is that global supply of solar electric (PV) panels continues to exceed demand – meaning a decreased cost per installed watt of solar panels.

In fact, the cost per watt for a grid-tied photovoltaic system has dropped by roughly 30% over the past 18 months, meaning that the time to lock in your energy rate with a renewable solar power system is now.

This is great news for people in northern New England who want to save money and clean up the environment. Most of the electricity generated in Maine and New Hampshire today comes from oil and gas-fired power plants, which emit enormous quantities of harmful byproducts into the atmosphere.

Solar power systems, on the other hand, have zero emissions and only need sunshine for fuel. ReVision Energy has installed more than 1,000 grid-tied solar electric systems, thereby gradually reducing the need for fossil fuel power plants.

One of the biggest struggles many homeowners have when considering solar is the ROI – due to the up-front cost, many people want to know how long it will be before they will start saving money on the system vs. what they would have paid to energy utilities.

Lowered cost of solar panels does a lot to make this technology more affordable.

ReVision Energy customer Ben Tipton pointed out on his blog how important he feels a solar investment is to a house:

Everyone always talks about the return on investment when it comes to solar … This to me is a silly question. No one ever asks when the refrigerator, TV, furnace, car, video game is going to break even. I consider my solar a integral part of the house, something that the house couldn’t be without. I have not found the solar additions to the house any more expensive than say a regular furnace.

Indeed, Tipton’s attitude – that energy efficiency is simply part of house design, not an optional luxury, is growing more common as it becomes increasingly clear that our road to energy independence needs to happen today, and by individuals, rather than by somebody else some day down the road (check out our coverage of Tipton’s house).

If you’d like to learn more, you can always contact us for a free solar site evaluation or attend one of our many events. We’re going to have a free, one hour Solar Sustainability Crash Course in our Portland office on January 23.

Skoglund with his homemade solar water collector

Six new PV panels installed

Photos courtesy Free Press Online

ReVision Energy has anointed Robert Skoglund, aka “the humble Farmer,” the “Solar Pioneer of the Year” for his efforts to make his home in St. George more energy-independent.

Skoglund, whose radio show ran on MPBN for 28 years (and now continues as a podcast and on independent community stations), successfully installed a homemade solar hot water collector, which on a sunny day heats water to 115 degrees. However, he encountered more trouble trying to install a solar electric system and called in ReVision Energy for assistance.

In a single day, ReVision installed six 230-watt Canadian Solar PV panels. The panels will provide close to 1800 killowatt-hours a year of clean, renewable energy each year. The system also has room to add twelve more panels.

Read more about this project in the Free Press Online article.

Receiving the Leed for Homes Innovative Project Award
Photo courtesy Bright Built Barn blog

The Bright Built Barn recently won the prestigious 2009 LEED for Homes Innovative Project Award from the U.S. Green Building Council (USGBC).

The award recognizes projects, developers and home builders who have demonstrated leadership in the residential building marketplace.

Phil Kaplan from Kaplan Thompson Architects and Tedd Benson from Bensonwood went to Phoenix, Arizona to accept the award at GreenBuild, the USGBC Annual Conference, this past December.

A write-up of the event is available on the Bright Built Barn blog.

We also received this report of performance of Bright Built Barn’s solar systems, one year later:

I’m happy to report that [BrightBuilt Barn] has exceeded all expectations.

On a subjective level, it has been a joy to live and work in – warm in the winter, cool in the summer, light and airy and lovely to look at all year round. I am also delighted to report that I have not had one minute of trouble with any of the systems – high praise indeed from a guy who hates maintenance and repair, and who has had his share of woes while living in a number of conventionally built houses over the years. The solar systems in the Barn are simple, with few moving parts, and highly reliable – so far, they just work.

BrightBuilt Barn Generated a surplus of more than 5000 KW/hrs in 2008-09

ReVision installed the solar hot water and solar power systems in this innovative, net-zero building.

In its first year, the home’s PV system generation a surplus of 5094 kilowatt-hours – or enough energy to power 5 conventional homes for a month.

Building owner Keith Collins goes on to say that “The Barn does, in fact, power my conventionally built main house (over 15 years old and no paragon of energy efficiency) which sits about 100 feet away, and has produced over 60% of that home’s electrical use.”

You can see real-time system performance of the Bright Built Barn online at brightbuiltbarn.com.