2014/06/27

Consumers encouraged to invest in solar energy

by Malou M. Mozo
June 24, 2014


Cebu City,Cebu – The Visayan Electric Company (Veco), the second largest power distributor in the country, announced yesterday some 31 interested applications for its “Veco Solar” campaign urging consumers to invest in solar power generation and reduce power use at home.

“The response we got from our consumers, especially residential consumers, is overwhelming,” said Veco Energy Efficiency Specialist Richard Alfafara in an interview with Manila Bulletin yesterday during the sidelines of the Cebu Unplugged: Energy Forum hosted by the company at SM City Cebu.

ENERGY FORUM – Visayan Electric Company (Veco) Chief Operating Officer Sebastian Lacson (right) chats with Department of Energy Undersecretary Raul Aguilos during the Veco-sponsored Cebu Unplugged Forum at SM City Cebu. Among others, the forum was held to teach private consumers how to save energy. (Cheryl |Balciantos)

Veco is the first distribution utility in the country to promote the use of solar energy by its customers through their “Green Energy for a Brighter Future” campaign. Veco Solar has the objective of providing government a helping hand in efforts to protect the environment from pollution.

The company has formed a strategic partnership with Enfinity, the sixth largest developer of solar photovoltaic (PV) projects in the world and a market leader in Europe.

In yesterday’s forum, Veco chief operating officer Sebastian Lacson urged customers to invest in solar power generation to reduce power consumption at home.

“Going solar means not only helping protect the environment but also saving money on electricity bills,” he said, explaining how the Veco Solar program works.

Solar PV panels will be installed in a house’s roof where free energy from the sun is turned into direct current electricity and then carried to a wiring through an inverter and converted to alternating current electricity used at home.

Solar energy produced during the day is used to power appliances, and at night when the system is not producing energy, Veco supplies electricity the normal way. A bidirectional meter records not only the total electricity consumed but also the total electricity produced by the panels.

Lacson said a consumer investing in solar energy will become a power producer with a maximum limit of 1,000 watts. If the consumer uses less than the maximum limit, Veco will pay for the difference.


A typical one-kilowatt peak PV system installation produces 112.5 kilowatt-hours (kWh) or about P1,300 in electricity cost. “If a regular household consumes an average of 200 kWh, which is about P2,400, it would be able to save an average of P1,100 in electricity bill if an investment is made in solar energy,” Alfafara further explained.

http://www.mb.com.ph/consumers-encouraged-to-invest-in-solar-energy/

***
EastGreenfields Enterprises is looking for partners in Cebu/Visayas area for supply /dealership agreement.
email us if interested: inquiry@eastgreenfields.com

2014/06/26

Top 6 Things You Didn't Know About Solar Energy

Top 6 Things You Didn't Know About Solar Energy

June 22, 2012
energy.gov

This article is part of the Energy.gov series highlighting the "Top Things You Didn't Know About..." series. Be sure to check back for more entries soon.
6. Solar energy is the most abundant energy resource on earth – 173,000 terawatts of solar energy strikes the Earth continuously. That's more than 10,000 times the world's total energy use.
5. The first silicon solar cell, the precursor of all solar-powered devices, was built by Bell Laboratories in 1954. On page one of its April 26, 1954 issue, The New York Timesproclaimed the milestone, “the beginning of a new era, leading eventually to the realization of one of mankind’s most cherished dreams -- the harnessing of the almost limitless energy of the sun for the uses of civilization.”
4. The space industry was an early adopter of solar technology. In the 1960s the space industry began to use solar technology to provide power aboard spacecrafts. The Vanguard 1 -- the first artificial earth satellite powered by solar cells -- remains the oldest manmade satellite in orbit – logging more than 6 billion miles.
3. Fast track to today and demand for solar in the United States is at an all time high. In the first quarter of 2012, developers installed 85 percent more solar panels compared to the first quarter of last year. Total U.S. installations may reach 3,300 megawatts this year – putting the country on track to be the fourth largest solar market in the world.
2. As prices continue to fall, solar energy is increasingly becoming an economical energy choice for American homeowners and businesses. Still, the biggest hurdle to affordable solar energy remains the soft costs – like permitting, zoning, and hooking a solar system up to the power gird. On average local permitting and inspection processes add more than $2,500 to the total cost of a solar energy system. The Energy Department SunShot Initiative works to aggressively drive down these soft costs – making it faster and cheaper for families and businesses to go solar.
1. In California’s Mojave Desert, the largest solar energy project in the world is currently under construction. The project relies on a technology known as solar thermal energy. Once the project is complete 350,000 mirrors will reflect light onto boilers. When the water boils, the steam turns a turbine, creating electricity. The project is expected to provide clean, renewable energy for 140,000 homes and is supported by an Energy Department loan guarantee.

Emissions Without Borders: The Problem With Greenhouse Gas

Emissions Without Borders: The Problem With Greenhouse Gas
Belinda Waymouth 

Environmental advocate, geographer, UCLA, mother


We can fence national boundaries with concrete and barbed wire, but unseen CO2 emissions are released into a border-less atmosphere. Right now, we are on track to triple these emissions by century's end.

The last time CO2 levels went sky-high, the planet was probably 18 degrees Fahrenheit hotter, with sea levels approximately 120 feet higher than now. But we were not here then to enjoy the overly sultriness of it all. 

Having been around for 200,000 odd years, our only experience with extreme temperature increase was after the last ice age. The planet heated up seven to nine degrees over thousands of years. Can our grandchildren and great grandchildren handle predicted planetary heating that's 10 times faster?

The 2003 heat wave in Europe killed 35,000 people with summer temperatures in parts of France 18 degrees hotter than their 2001 summer.

I do not want to scare the pants off anyone, but.... 

When leading climate scientist, James Hansen, former head of NASA's Goddard Institute, stresses de-carbonization of energy by 2030 or certain climate catastrophe. I think mitigating emissions pronto would be the rational next step, just in case this very smart climate guy is right.

But as invisible greenhouse gases rise, so does the very visible conflict that swirls around them. In 2007, California Governor, Arnold Schwarzenegger, took his fight against CO2 emissions to the Supreme Court. He sued the Bush Administration so that California could enact bigger-muscled vehicle emissions laws. 

Assembly Bill 32 aims for California's emissions to be 80% below 1990 levels by 2050. In part this will be achieved by the state's ambitious commitment to have 33 percent of its electricity produced by non-CO2-emitting renewable energy by 2020.

The state also runs a tight cap and trade program, which unlike the EU's faltering Emissions Trading Systems is working quite nicely. So far it regulates big industry and the energy sector. Already the Los Angeles Department of Water and Power reports a 22 percent emissions drop (in part by having more renewable energy and less coal on the books) but also because fines for going over emissions caps are hefty.

But while California aggressively cleans up its act, it has no jurisdiction on nations upwind such as China. Or whom China does energy business with. The Environmental Protection Agency estimates 25 percent of the particulate matter in Los Angeles skies originates from Chinese coal-fired power plants. Some of the dirtiest fuel being burned in these power plants is petcoke from U.S refineries.

The EPA has set limits on the domestic burning of petcoke fuel. But this ruling, which lowered overall U.S CO2 emissions, just outsources the emitting location. It doesn't matter whether you're sending it right next door or across the Pacific, the atmosphere is an all-encompassing, amorphous layer of shared gas.

 California's unilateral mitigation is a bold step in the right direction. A challenge to the rest of the U.S. But the North American continent seems to have ever-increasing supplies of high carbon fuels and an industry gung-ho on extracting them. 

The IPCC's (Intergovernmental Panel on Climate Change) March report reiterated the risks involved without immediate reduction of CO2. The same day Exxon Mobile came out with its own 'carbon risk' assessment. The company assured stockholders, "we are confident that none of our hydrocarbons are now or will become 'stranded.'" Meaning they will be able to extract all the oil and natural gas they want. The company boasted government restrictions were "highly unlikely" to stop Exxon Mobile from oil business-as-usual.

 But while Exxon Mobil feels good about the future, there are some cracks in the fossil fuel industry's mitigation-schmitigation façade. 

Big coal appears to be running scared of non-CO2-emitting energy sources, going so far as to describe the sun as a "disruptive challenge." Coal produces 40 percent of U.S electricity, solar clocks in at less than 1 percent, with individual rooftop solar panels a tiny fraction of this amount. But small-potatoes rooftop solar is getting some very negative press these days.

"These green energy mandates are bad policy," says Christine Harbin Hanson, a spokeswoman for Americans for Prosperity, an advocacy group backed by oil industry heavy weights. 

The AFP is part of recent anti-solar movement that wants states like Kansas and Arizona to slap a surtax on individual rooftop solar. The movement is also pushing states to reduce overall commitments to solar generated energy.

While all the back and forth goes on, the CO2, methane and nitrous oxide go up. Up into an atmosphere that once floated like a big security blanket around our planet. It let just the right amount of heat in and out. But it can no longer effectively let all the heat out. We have unwittingly trashed our collective security blanket. 

Mitigation can and is being enacted on local, state, national and international levels, but the sooner it is a coordinated multilateral effort, the more sense it will make. We need to get serious about the reality of our shared geography. We are one people, under one atmosphere.

http://www.huffingtonpost.com/belinda-waymouth/emissions-without-borders-climate-change_b_5390373.html

Gov’t urged to cut taxes on energy

Gov’t urged to cut taxes on energy

Move seen to lower retail electricity costs

MANILA, Philippines–The Management Association of the Philippines (MAP) is asking the Department of Finance (DOF) to consider various proposals to lower or remove certain taxes on energy to help cut electricity costs for consumers even without amending Republic Act No. 9136, or the Electric Power Industry Reform Act (Epira).

In a position paper, MAP suggested that the DOF revisit the recommendation of the USAID Study on Taxes and Rationalization so that government taxes such as the value-added taxes (VAT), royalties on natural gas and others could be harmonized. These taxes account for P0.35 to P2.75 a kWh of the total electricity price paid by consumers.

The group said the removal of VAT alone could effectively reduce electricity tariffs by 7.5 to 8.1 percent. However, doing this would remove the benefit to be enjoyed from buying VAT-free renewable energy (RE) supply. “Thus, the zero rating of VAT will effectively diminish the incentives towards RE,” MAP said. If the DOF would take this route, MAP said other incentives envisioned by the RE Act must then be in effect to continue encouraging RE development.

An alternative would be to lower the VAT from 12 percent to 6 percent to effectively reduce power rates by 3.7 percent for residential and commercial users and 3.3 percent for industrial users, MAP said.

Another consideration, MAP said, was the proposal to replace all applicable taxes with a 3-percent franchise tax on gross distribution income. The 3-percent franchise tax may be applied on the distribution, supply, metering and system loss components. This proposal could effectively lower the electricity prices by 7.5 to 7.7 percent.

MAP said the DOF might also consider the deletion of royalty taxes on indigenous materials such as natural gas; resolution of outstanding assessments of real property and franchise tax issues; provision of incentives for domestic manufacturing companies to locate and operate in the poorest regions of the country to promote labor generation; and/or exemption of power companies (generators, distribution and transmission) from real property tax, so that the benefits could be passed on to consumers.


Read more: http://business.inquirer.net/173604/govt-urged-to-cut-taxes-on-energy#ixzz35hr9yBkj

2014/06/24

NREB qualifies cost impact of higher solar installation

NREB qualifies cost impact of higher solar installation 
by Myrna Velasco

June 19, 2014


The National Renewable Energy Board (NREB) is disputing the calculated P8-billion ‘subsidy impact’ of the proposed increase in solar technology installation to 500 megawatts (MW) from a previously-approved cap of 50MW.

NREB Chairman Pete Maniego Jr. said the level of subsidy when it comes to renewable energy (RE) technologies of which developments will be underpinned by feed-in-tariffs (FITs) must only be estimated beyond the prevailing grid rate.

“The consumers have to pay the grid rate or generation charge even if there are no RE installations,” he said, qualifying further that based on their computation, the resulting subsidy cost will be way lower than the P8 billion estimate of the Foundation for Economic Freedom (FEF), the main opposing party to the Department of Energy’s proposal to hike the installation target for solar developments.

“Assuming an average capacity factor of 50% and the high FIT-Allowance of P0.10 per kilowatt hour (kWh), the resulting FIT support for the 750MW will be a maximum of only P328.5 million per annum,” he stressed, adding that if hydro and biomass project developments will be spurred, such would have ‘cost mitigating effect’ on the overall FIT-All that will be reflected in the consumers’ bills.

In probabilities that the FIT-All will be tempered to P0.05 per kWh, Maniego noted that “the FIT support will be down to only P164.25 million per annum.”

He explained that their calculation had been juxtaposed on the clearing prices drawn from the Wholesale Electricity Spot Market (WESM), primarily on months of higher availability for solar-produced energy.

Nevertheless, Maniego emphasized that they are open to discussing and fleshing out the details of their computation vis-à-vis the figures set out by the FEF, so the consumers can be fully apprised of the cost impacts for the targeted RE installations.

And given volatile pricing in the WESM and the notoriety of energy forecasting turning out to be wrong, relevant stakeholders primarily FIT Administrator National Transmission Corporation (TransCo) had been prodded to re-study the cost impacts up to the end of the 20-year FIT subsidy before even agreeing to installation increase for specific RE technologies.

“The higher the grid rate, the lower will be the FIT-Allowance. Even assuming that the grid rate will remain fixed over the 20-year period, so that the FIT-Allowance will also remain fixed, I can’t get anywhere near the allegedly P8 billion conservative estimate of FEF… I don’t want to pre-empt TransCo, but I was assured that the FIT Allowance will be much lower than P0.10 per kWh,” Maniego said.

It is worth noting though that many power markets globally are already propping up to ‘walk away’ from FIT and other forms of RE subsidies as they predict grid parity and cost lowering for such technologies in the next 5-10 years.

Maniego said the increase in solar installation was an initiative of the DOE, a policy step that was also announced earlier by Energy Secretary Carlos Jericho Petilla.

“The 500MW came from DOE and of course, we are happy to concur. We proposed to increase both wind and solar, as these technologies have exceeded their installation targets… we actually wanted to increase the targets, but had not proposed any definite figure yet pending stakeholder consultations,” he stressed.

source: http://www.mb.com.ph/nreb-qualifies-cost-impact-of-higher-solar-installation/

2014/06/20

German solar industry sets major records in June

RENEWABLE ENERGY:
German solar industry sets major records in June but needs more storage

Henry Gass, E&E reporter
ClimateWire: Thursday, June 19, 2014

Over a two-week span earlier this month, the German solar power sector broke three national power production records, according to analysis from a German industry research institute. Its growing solar capacity also makes it a world leader, but whether the remarkable growth can continue could hinge on what happens in the energy storage market in the next two years.

In the first week of June, the German solar power sector generated a record total of 1.26 terawatt-hours of electricity, according to Fraunhofer ISE. On the second Monday in June, a national holiday in Germany, it produced 23.1 gigawatts between 1 and 2 p.m., equaling 50.6 percent of the nation's total electricity demand.

But several coinciding circumstances aligned to help set these records, according to Tobias Rothacher at Germany Trade & Invest, the country's economic development agency. Solar power production in early June has shown what the sector is capable of, but whether Germany is able to consistently harvest this much power is another question.

One reason for this month's records is, simply, that Germany has more solar panels installed this year than it has in the past, Rothacher said.

But good weather and the fact that it was a national holiday weekend, when there is usually less electricity demand, were big factors in producing this month's records, Rothacher said. In the first five months of this year German solar power production is about 34 percent higher than it was last year, while actual installed capacity only increased by 10 percent.
Without more storage, solar power will be lost

But even with steadily increasing capacity and a proven potential to supply the bulk of Germany's electricity demand, solar power isn't going to be able to displace fossil fuel resources until it is able to store the surplus energy it generates on good-weather days.

"Nowadays we also need fossil fueled power plants in case the weather is not so good," Rothacher said. "Over time, we need to have more flexibility, and that means we need to store this [solar] electricity.

"We can only provide this consistency of solar power in the grid if we have storage capacity: for example, the bundling of thousands of [photovoltaic] energy storage systems in order to provide grid support services."

In the next few years energy storage capacity is going to be crucial to the long-term economic survival of Germany's solar power sector. The industry is currently supported by a feed-in tariff that pays solar power providers for the electricity they feed into the grid. When the country reaches 52 GW of installed solar capacity, that tariff will stop. Germany currently has 37 GW of installed capacity, and Rothacher expects the country to reach 52 GW in next three or four years.

The solar power sector -- along with other intermittent renewable power sectors in Germany -- is also hurt by some details of the European grid system, which charges power producers for feeding power into the grid when there's an oversupply.

The "negative pricing" during periods of oversupply is needed to keep electricity supply and demand in balance, but for conventional fossil fuel power sources, it is often cheaper to pay the charge rather than shut down. Some power producers are technically not quick enough to reduce their output when they have to, so they pay, too (ClimateWire, June 18).
Incentives needed for batteries?

Renewable energy sources, on the other hand, are required to shut down during periods of oversupply -- which is also often when solar and wind power facilities are producing the most power. And as solar capacity grows, electricity oversupply will become more of a problem, Rothacher said.

"If we don't build up storage capacity then our other renewable energy sources will be shut down more often," he added.

But there are several ways Germany could build storage capacity over the next few years, according to Rothacher, including through some financial benefits the market hasn't valued yet. For example, electricity providers in Germany have to pay every time they transport electricity through the grid. With enough storage capacity those fees could be avoided.

There are no major technological obstacles in the energy storage market, but Rothacher said the storage market will need similar monetary and regulatory support from the German government that the solar industry has received in order to grow.

"Both of these markets are really interconnected," Rothacher added. "We need to change some of these grid regulations, and we could maybe start to value, monetize some of the services batteries can provide."

2014/06/13

Renewables

By Ducky Paredes | May 21, 2014

OUR President has always been critical of using renewables – wind and solar power -- to generate electricity. In a State of the Nation Address, he said: “Did they happen to mention that renewable energy is also more expensive–from the cost of building the plants to the eventual price of energy? Did they mention that it cannot provide the baseload–the capacity required to make sure brownouts do not occur?”  

Then, he really let loose: “If you put up a wind-powered plant, what do you do when there is no wind? If you put up a solar plant, what do you when the sky is cloudy? Let me be clear: I believe in renewable energy and we support its use, but there should also be baseload plants that can ensure a steady supply of electricity for our homes and industries. I wonder if those who are critical of the plants we want put up will be as noisy when they are busy fanning themselves during brownouts. All I am really saying is this: Let us help each other find a solution.”   Well, the problem is that our President has got it all wrong.

Dr. Jean Lindo, convenor of No to Coal (Network Opposed to Coal) Davao, and a member of the nationwide broad coalition, antiCOALition, noted that she found it “disappointing to hear a President make fun of Renewable Energy solution during his SONA which betrays his lack of knowledge on the science of clean and green energy.”   While she ignores the President’s silly remarks, she says that she forgives the President “since he is not a man of science.” However, she adds “a wise, conscientious leader would have consulted credible scientists rather than toe the line of corporate reductionism.”  

Lindo said that the President and his advisers “do not know that even if there is no wind in Malacañang he can still enjoy electricity because the Philippines has a total wind capacity that can produce 70,000 MW of potential installed capacity, according to a 1999 US-NREL (National Renewable Energy Laboratory) study and this estimate is conservative.”

“Even on a cloudy day over Malacañang, the solar panels can still capture the light and energy can be stored and they can enjoy energy still,” she said, adding that if the President and his advisers “do careful, independent search on Renewable Energy, they would surely bump into very good models of long-term, people-friendly, sustainable energy,” she said.  

“It is not funny that they have voluntarily turned themselves into political green jokes in favor of corporate reductionists,” Lindo added.  

Even now as he has just inaugurated the largest solar plant in the Visayas, the President is on record as saying:

“Renewable energy is still the most expensive component. It follows that if our entire energy mix is derived from renewable sources, then the price of electricity – which people are already complaining about today – will rise even more. Government therefore has to strike a balance between this, and our desire to attract more investments in renewable energy.”  

Our President or the ones who write his speeches (which he delivers without thinking) and those he consults with on renewables are dead wrong. They have to be.  

Germany and France, which have at least 50% less sunlight than the Philippines gets, have embraced solar and wind power, relying on them, on certain days, for as much as 50% of the electricity that they use.

Here is a report from a German Energy blog: “En route to its 2050 Energiewende goal of 80% of the nation’s power being supplied by renewables, especially spurred on by the phaseout of nuclear reactors, Germany broke another renewable energy record on Sunday, May 11, 2014. Europe’s biggest clean-energy market reached almost 75% renewable power market share on noon of that day.  

(Energiewende was the title of a 1980 publication by the German Öko-Institut, calling for the complete abandonment of nuclear and petroleum energy. On the February 16 of that year the German Federal Ministry of the Environment also hosted a symposium in Berlin, called Energiewende – Atomausstieg und Klimaschutz (Energy Transition: Nuclear Phase-Out and Climate Protection). The views of the Öko-Institut, initially strongly opposed, have gradually become common knowledge in energy policy. In the following decades the term expanded in scope; in its present form it dates back to at least 2002.)

*Energiewende designates a significant change in energy policy: The term encompasses a reorientation of policy from demand to supply and a shift from centralized to distributed generation (for example, producing heat and power in very small cogeneration units), which should replace overproduction and avoidable energy consumption with energy-saving measures and increased efficiency.)  

“As the Disruptive Renewables chart created by Renewables International shows, electricity prices went negative for much of the afternoon.  

“Renewables hit another record in the first quarter 2014 by supplying 27%–over one quarter–of Germany’s electricity demand. Bloomberg reports that the German Association of Energy and Water Industries (BDEW), which represents 1,800 companies, calculated that renewable generators produced 40.2 billion kWh of electricity this past quarter, up from 35.7 billion kWh in the same period last year. BDEW attributes the achievement to additional installations and favorable weather.

“Bernard Chabot, a well-known renewable energy consultant based in France, sees the 27% figure as indicative of renewable energy’s potential, as Kiley Kroh of ThinkProgress reports:  

“‘Once again, it was demonstrated that a modern electricity system such as the German one can already accept large penetration rates of variable but predictable renewable energy sources such as wind and solar PV power.’

 “Renewable energy in Germany has grown tremendously in the past decade, with wind and solar the nation’s most productive technologies. The 27% renewable power use amount is double the share of US electricity supplied by renewables recently.

“As reported in Solar Love in March, the ECLAREON PV Grid Parity Monitor of parity proximity indicated that the PV Levelized Cost of Electricity in Germany, Italy, and Spain has reached retail parity with the grids in those nations. Commercial solar power there is no longer more expensive than conventional energy sources.  

“Grid parity is defined as the moment when PV LCOE becomes competitive with grid electricity prices. Once PV grid parity is reached, electricity consumers would be better off by self-consuming PV-generated electricity instead of purchasing electricity from the grid.  

“Germany and Italy are better positioned than Spain, however, because of the latter nation’s lack of regulatory support for PV self-consumption. In fact, Spain has instituted retroactive solar feed-in tariff cuts and blocks individuals from using solar power not generated by the country’s official energy companies.

“Germany and Italy have comparatively low PV installation prices. Each boasts a competitive system, low discount rates, and high retail electricity prices. Mexico, well positioned, is likely to reach parity next, and France, with a relatively neutral regulatory profile, soon afterward.”

Even without total understanding of the situation, as proven by the colder countries in Europe that have less sun than the Philippines gets, a shift to solar and wind energy and other renewables is possible and costs can even improve and become more affordable. After all, France, Germany and Italy have gone the route and even lowered the cost to their consumers. If these countries deprived of the amounts of sun that we suffer from, can do that, why are we stuck with coal plants and oil-burning generators and the costs that they bring with them? Because those who control our energy policy are coal and oil men!

Readers who missed a column can access www.duckyparedes.com/blogs. This is updated daily. Your reactions are welcome at duckyparedes@gmail.com or you can send me a message through Twitter @diretsahan.





2014/06/09

Cost of off grid solar electricity

How much is the cost of off grid solar electricity?
"To off grid or not to off grid? That is the question..."
Blog entry by EastGreenfields Enterprises

Nowadays there lots of people thinking of going solar… sure, good it’s about time! With dwindling supply in the provinces or even in the cities during the summer months and the monthly power bill increases who wouldn’t think about going solar?

Off grid solar is advantageous especially if you don’t have an access to cheap electricity. Hands down, off grid solar just makes an economic sense… But if you are living within an area that is already supplied by the grid electricity is it still economically wise to have off grid system? This blog entry will try to answer that question.

As stated, an area without access to grid electricity, off grid solar generated electricity makes sense simply because there is no benchmark of the cost of electricity in that areas…say an island in the Visayas or in a village in the Mountain province. But within city limits or within an area with access to Meralco or cooperative distribution grid, there is a benchmark how off grid solar electricity should cost.

In average, the cost of grid electricity is P12 per kW-hr. The cost of off-grid solar electricity should be less than the grid price so that you can say it’s a good economic sense… a wise investment.

                                    (E1) Grid electricity cost > off grid solar electricity cost 

So how much is the off grid system cost?

Off grid solar main components are the following: Solar panel, charge controller, power inverter and batteries. And the ancillary equipment (termed as balance of system or BOS in geek speak) as follows: mounting bracket, junction/panel boxes, breakers and switches.

If we would like to power a desk top computer (230 watts) and electric fan (100 watts) for at least 6 hours per day then the power requirement will be at least 1980 watt-hour. For this load requirement a 500 watt off grid system is required. The table below summarize the equipment required for the system and the cost of the main equipment. Note here that balance of system or the ancillary equipment is not given price and the labor too is not included.

500 Watts-peak Off grid system
Parts
Price
5x 100 watts Solar Panels – Polycrystalline  (Yingli Brand)
PHP 35,375.00
40 Amps Solar Charge Controller (MPPT Type)
PHP 19,656.00
   '- EPSOLAR Tracer 4210
2000 watts Inverter (Pure Sine Wave)
PHP 12,298.72
3x 120 AH Motolite Solar Master
PHP 24,120.00
Capital cost of 500 Watts-peak Off grid system
PHP 91,449.72

(Disclaimer: The prices indicated in this blog entry are the current market price of each component. There maybe some discrepancy in the price, reader may disagree on the prices indicated, after reading this blog the reader is encourage to make their own calculation and analysis to make their own decision in going off grid solar.)

Cost of off grid solar electricity per kW-hr produce

To make an analysis or cost comparison against Meralco prices, the off grid solar electricity for the 1st year of operation should be calculated. The 500 watts-peak off grid system on average can produce 648 kW-hr of electricity. Divide the capital cost by the 1st year energy produce to calculate the cost of off grid solar electricity for 1st year operation.

(E2) 1st year operating cost, C1st yr

             




Equation 2 (E2) shows how much the cost of off grid solar electricity. The result is not encouraging given that the average grid electricity cost only P12 per kW-hr. But the system will not only be operational for just 1 year right? Yes of course so it should be evaluated against energy produce for the rest of its useful life cycle.

Off grid solar has one big disadvantage, it uses a battery for energy storage and batteries needs to be maintained and replace after a period of time because of deterioration. And batteries are not replace piece by piece, a battery bank of 3 batteries, should be replaced by equal number of 3 batteries. For the 500 watts-peak off grid system, it was designed with a depth of discharge of 50%. It has a battery bank of 3 units of 120 AH Motolite Solar Master. With a diligent operation of 50% DOD, it is estimated to last 5 years. So it means that in the 5th year of operation the batteries should be replaced. Replacement will incur at least P24,120 (note: to simplify calculation, we will not impose future cost of batteries, we will only use present cost).

(E3) 5th year operating cost, C5th yr





After 5 years of operation and battery replacement on the 5th year, the cost of off grid solar electricity is still higher than the average grid electricity. Thus, after 5 years, off grid solar electricity is more expensive for areas with readily available grid electricity.

Solar panels are designed for at least 20-25 years effective up to 85% of its rated name plate capacity. It means that after 20-25 years, the 100 watt panels can still deliver 85 watts of its name plate. Given the longevity of the solar modules, it is therefore calculated against 20-25 years of production.

The table below shows the cost of off grid system from 1st year to 25th year design life cycle.


off grid solar cost
Yr cost
500W off grid system
cost per kW-hr
1st yr cost
PHP 91,449.72
PHP 141.13
5th yr cost
PHP 115,569.72
PHP 36.25
10th yr cost
PHP 139,689.72
PHP 22.36
15th yr cost
PHP 163,809.72
PHP 17.85
20th yr cost
PHP 187,929.72
PHP 15.69
25th yr cost
PHP 212,049.72
PHP 14.48


The table shows, without doubt even if we use present cost calculation, the cost of off grid solar electricity is always greater than the cost of grid electricity.

The cost of off grid solar escalates over the years because of battery replacement. It is inevitable because the system simply won’t work without batteries for energy storage.  


The advantage of independent power source by using batteries is also the biggest cost disadvantage of off grid systems. That is why off grid system is best used in areas without access to grids like resort homes, farm houses, and other remote applications.