Our solar panels have been active for four years. In the first two years we used more electricity than the panels produced. I know this because I follow the electric meter almost obsessively. When the meter shows a low positive number, it means we are using more than we are producing, as of that moment in time since the panels went live. If the meter runs backwards (into the 99000s), then we have cumulatively produced more electricity than we have consumed.
I record the meter reading every March 26th around 1:30 PM, the approximate time we went live in 2019. Following are the readings and cumulative production totals at the end of each year:
| Year ending March 26 | Meter Reading (Kilowatt Hours) | Cumulative Production (MWh) | Annual Production (MWh) |
| 2020 | 00455 | 9.67 | 9.67 |
| 2021 | 01098 | 18.77 | 9.1 |
| 2022 | 00387 | 28.1 | 9.33 |
| 2023 | 99602 | 37.25 | 9.15 |
After year’s one and two I had concluded that we should have installed a few more panels to be energy neutral. However, I also knew that over time we would probably use less electricity and that has proven to be true. We are now 853 KwH ahead (398 to get back to all 00000 + 455 above that.
Should we get an electric car or convert to electric heat/hot water (currently on natural gas), we would be under producing.
Under the current Maryland net-metering system, excess generation is paid out in May, based on the surplus KWh at the end of April meter reading. Since March and April are both good surplus months (days are longer, sun is higher, but no AC yet), this means the typical customer receives a check each May for the commodity portion of this surplus. Recall that the other major portion of a bill is the delivery fee. This is kept by the utility company.
There is one issue with this current system. Because the March/April surplus is paid out (albeit at about 2/3 the actual rate), we do not quite generate enough surplus May-September to carry us completely through the winter, although this year we came pretty close. This means we have to pay the full price for the energy consumed once our surplus is used up. Our first two winters this cost us about $135 each. We got better though in year’s three and four building up our summer surplus. These winters only cost us about $26 and $11 respectively.
A new law has recently passed the Maryland General Assembly that, if signed by the governor, will create an additional option, to accumulate this surplus indefinitely until the surplus is used up (for example by buying an EV) or until the account is closed.
Is solar a good deal in Maryland?
I continue analyzing our experience in light of the question, is this a good deal, and if so, for whom. Most people think in terms of payback time, which for us is looking to be about 10 years. Since the panels have at least a 25 year life span, this seems like a good deal if one has the money to install the system and one expects to stay in the home long enough to realize the benefit.
Another way to look at the problem is Total Cost of Ownership (TCO). My after tax cost for my system was $16,500 (This is documented in previous posts). To determine 10 year TCO we have to make some assumptions:
- MWh generated : 90
- SREC $$ generated: $4500 ($50/MWh)
- May surplus re-imbursed: $600 ($60/year)
Subtracting the SREC payments and the May surplus checks from my after tax cost brings my 10 year cost to $11,400. Dividing this by 90 yields about $127 per MWh or 0.127 per KwH. This is about what rates are now. Will they go up over the next 6 years? I expect so, but I do not know.
Over a 25 year period, these TCO numbers look even better:
- MWh generated: 200 (assuming a decline in output as the system gets older)
- SREC $$ generated: $10,000 ($50/MWh)
- May surplus re-imbursed: $1500 ($60/year)
This brings the cost down to $5000 for 200 MWh generated, which works out to $25/MWH or 0.025 (two and one-half cents per kilowatt hour). This seems like a great deal to me.
Note that we do not know how long the SREC program will exist or how the May reimbursement program will work – if we end up switching to the infinitely cumulative surplus, we could perhaps build enough surplus to power an EV for a long time, so these calculations are all subject to change. The point though is that the lifetime cost of the panels should be significantly less than the utility rates for the same amount of electricity.