Solar

I know this post was a long time coming as I told you several months ago I would write a whole post devoted to solar… a long time coming, but here it finally is!

Since I let the cat out of the bag in a previous post, I guess I’ll fill you in on our decision to go solar.

First of all, believe me, I know it sounds counterintuitive to take on more debt when we are already so deep in debt; but in the long run, it’s definitely going to save us money.

We actually started to look into solar because some guy was going door-to-door pitching solar and we said we’d be interested to see how solar would work for us and to find out how much it would cost. (In December and January, we had some astronomically high electric bills… like $725 high!)

He worked up a proposal and presented us with a plan that covered our ENTIRE roof and had a bargain-basement price of $73,000. After seeing the look on our face, he must have realized that was never going to happen because he then told us with some “special pricing that he would need to get approval for” he could get the cost down to $57,000. That was still a no-go for us. We didn’t tell him outright no, but we did tell him we needed to meet with some more companies and get some more quotes.

And boy, are we glad we did!

After our first meeting, where we were quoted with special pricing of $57,000, The Husband quickly contacted other solar companies and we had to meet with them in a compressed timeline, which actually worked in our favor because it kept us from lollygagging!

We met with three more companies and they all came in with a much lower cost. They all ranged from $27,000 - $35,000. Much more reasonable. And these quotes did not include the 30% refund from the federal government (and the other quote DID).

We spend about 1.5 – 2 hours with each company that we met with; and although I wouldn’t call us experts by any means, our knowledge of solar did grow exponentially!

Each of the companies had pros and cons and then we were left to decide what was the most important to us. They each had different financing options (both in terms and length), they all used different solar panels, they all had warranties (at least to some extent), and they all had “plan” for our house and our usage.

In the end, we went with a company that quoted us $33,000. But they did throw in “free” rodent netting! We decided to do a 10 year loan at 2.99%. Our payments are going to be $234 a month, which is considerably less that the $725 we paid in December, and even less than our average PG&E payment of $400 per month.

Going back to the pool pump issue… our pool pump was old and not energy efficient, therefor it was costing us a lot of money to run it and if we didn’t upgrade it, it would require a larger solar package and thus a more expensive package. By upgrading our pump now, at a cost of (roughly) $2000, we lowered the monthly payment on the loan by $65 every month. Spread out over a year, that is a savings of $780, and over three years, it’s a savings of over $2300. Essentially, the pool pump will pay for itself in less than 3 years and after that we are “making money”. Believe me, I know I’m rationalizing this!

When all is said and done, upgrading to solar, including the new pump and tax incentives, we will be paying about $25,000. The solar alone will run us $23,000. That is what we will be financing over 10 years. The payments are more than reasonable and our goal is to pay it off in no more than 7 years. The first year we are going to be very cautious and set any “extra payments” aside until we get our “true bill” from PG&E. We don’t want to be caught in a pickle when the true bill shows up.

Hopefully, this will affect our budget in a positive way and we will be able to send more money towards our credit card debt each month!

*I actually wrote this post about 3 months ago and never published it. Since then, we have started paying for our solar and seen a drastic change in our PG&E bill. Our bill averaged $350 a month for PG&E with some months higher and some months lower. Our solar has now been hooked up since the end of June. Our last PG&E bill was $36. Coupling that with our monthly solar payment of $234 makes for a total of $270. Monthly, that is an average savings of $80 per month. That adds up to almost $1000 a year. And once our solar is paid off, IN 10 YEARS (eek), it will be a savings of $300 a month and over $3500 per year. Long term it definitely will save us a lot of money!

With our first, ridiculously high, solar quote our breakeven year wasn’t until year 19 and the warranty was only 20 years. With the quote we went with, our breakeven year is year 8 and it came with a 25 year warranty.

In the long run, it should be a good choice for us, but in the short run it just added to our debt. And it did add to our debt about $23000! But ironically, by adding to our debt we are saving $80 a month. I know it doesn’t make sense or sound right, but by the numbers, we have $80 more dollars to send to our credit card every month.

This was a super long post, maybe the longest I’ve ever written, so if you stuck around until the end, thank you!