How do you calculate my first-year utility savings?

First-Year Utility Savings is the amount of money you may save on your utility bills, in the first year after installation of the renewable energy system. It is the energy expected to be produced by the system times the utility rate (e.g. $/kWh for electricity or $/Therm for natural gas). We assume the minimum utility bill is $50 per year, to cover minimum utility meter and connection services.

If "Tiered" electric rates and/or time-of-use (TOU) metering applies, we provide a range of savings that you may realize:

Tiered Rates:: Often people are paying a "Tiered" rate for their electricity. This is a higher rate (higher than the "base rate") for electricity charged when a home or building uses more that a "base" amount allocated for the building.

TOU Metering: Many utilities offer Time-of-Use (TOU) meters. This allows the price of electricity to vary by time of day (called "Peak" or "Off-Peak" periods) and by season (usually "Winter" verses "Summer" rates). If TOU metering is offered by your utility, a renewable energy system may result in additional savings. This is because peak rates often occur during daytime peak periods. This is usually the time of day when a renewable energy system is producing the most output, thus reducing your demand for peak-rate electricity from the utility.

If your state and utility offer "Net-Metering" if you install a renewable energy system you may be able to "sell" electricity you generate back to the utility grid. This can result in even more savings, since you may be "selling" electricity back to the utility during peak rate times, and therefore at a peak rate.

Renewable Energy systems offer "fixed costs" for your electricity; the cost for wind and sunshine is constant (free) and does not rise. Utility rates, on the other hand, rise. So, the value of your savings are likely to increase as time goes on.


Go to www.solar-estimate.org