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Energy Efficiency Before Going Solar: How Much Difference In The Cost Does It Make?

Efficiency combined with solar changes the equation dramatically. The difference for me was roughly 2/3 the cost of a new Tesla Model 3.

Rooftop or on-site solar can often generate enough power for homes, businesses, and industry, helping customers become resilient and self-sufficient, and giving them a stable price for clean electricity for decades to come. If you’re in the market for solar, though, one thing needs to be top of mind: the price you pay for your solar is based on your consumption, so if you can reduce your consumption first, you can get an even better financial investment out of your solar.

How Much Money Can You Save On Solar By Doing Energy Efficiency First?

There are a ton of variables, of course, but suffice it to say, the savings are real. I’ll use my house as a case study. I set the baseline for energy consumption for several months before doing an energy efficiency retrofit. Turns out our home was using 1600 kWh per month. I called a local solar company and got a bid:

The solar company matched our existing bill to what would be needed to zero out said bill. This price is the out the door price, and the sticker shock usually cripples people, so solar companies usually offer $0 down financing, and just do a monthly payment slightly less than the original electric bill, to make it easy for customers.

Doing The Home Efficiency Work First

I started with the easy stuff — switching to LEDs, high efficiency faucets and showers, and a couple of advanced power strips and timers. I hung a couple of clotheslines and showed my housemates how to use them. This cost approximately $600.

Then I looked at two of the three refrigerators we had (it’s a triplex), and determined that they could be serious energy hogs, so I found one Energy Star fridge at a secondhand store and one from Lowe’s, with rebates from our local utility, and this came out to a grand total of a $700 investment to upgrade two fridges.

We then watched what happened to our bill, and the results were immediate, dropping down to 1000 kWh per month for a couple of months, a 35% reduction. This is not what I would expect to be “normal.” First, our house really committed to the clotheslines, and we eventually got rid of our dryer to make space in our cramped, shared laundry room. Next, we do not have central AC or heat, so the efficiency work described above made a larger percentage improvement than it would in many homes with central HVAC. HVAC, dryer, and refrigerators tend to be some of the biggest energy users in the house. Regardless, a drop of 15-20% for the above improvements would be pretty typical, I would imagine.

Now I went back and got a bid based on the new usage. The hardware dramatically changed, reducing the need for panels and batteries in order to get me to a zeroed out electric bill. From 35 panels to 23, and from 3 Tesla Powerwalls to 1.

This dramatically cut the proposed cost:

After installation, it became clear that I should have still opted for at least a second Powerwall, as my battery died most nights at about 4 AM, and then we paid full price per kWh from 4 til 9 AM, so we didn’t zero out the bill entirely in the winter months. But for the year after solar install, we had zero bill for 8-9 months, and after upgrading to a solar water heater, the bill went to zero for the whole year on just the one battery.

A lot of caveats, a sample size of one, and variables galore — I get it. But the results speak pretty loudly. With a thousand or so bucks worth of investment in home efficiency, it cut the net (after incentives) cost of my solar by more than $20,000, and more than 50%.

Peanut Butter … & Jelly

The American Council for an Energy Efficient Economy posted an article about efficiency being the jelly to solar’s peanut butter. They both work on their own, but together they’re magic. ACEEE’s analysis found that energy efficiency combined with solar changed the equation dramatically. Without doing the efficiency, solar was able to generate 50% of the residential energy load in only 9 of 24 states they analyzed. With efficiency, that number jumped to 23 of 24, and six of the states surpassed 75% with the combo.

The authors concluded, “Energy efficiency will generally be less expensive per kWh than solar. And by lowering consumption, energy efficiency will stretch the available rooftop solar resource farther, allowing solar to serve a higher percent of residential consumption while also allowing a smaller and less expensive solar system.”

That, and it will save the building owners some serious bank on their solar systems. The difference for me was roughly 2/3 the cost of a new Tesla Model 3.

 
 
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Written By

Scott Cooney (twitter: scottcooney) is a serial eco-entrepreneur hellbent on making the world a better place for all its residents. After starting and selling two mission driven companies, Scott started a third and lost his shirt. After that, he bought a new shirt at Goodwill and started this media company and once it was making enough, he was just smart enough to hire someone smarter than him to run it. He then started Pono Home, a service that greens homes, which has, by the end of 2020, performed efficiency retrofits on more than 13,000 homes and small businesses, saving customers more than $3.3 million a year on their utilities. Previously, Scott was an adjunct professor of Sustainability in the MBA program at the University of Hawai'i, green business startup coach, and author of Build a Green Small Business: Profitable Ways to Become an Ecopreneur (McGraw-Hill), and Green Living Ideas.

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