When looking at the system price from a couple of different installers, it can be hard to figure out if System A, System B and System C are really apples-to-apples. Different panels, different inverters and even different panel placement can mean a HUGE difference in payback time and value for your buck. (Not sure what you’re looking at? Click here to learn more about how solar technology works.)
Below, we’ll walk you through how to compare purchase prices for rooftop solar systems prices in Las Vegas. With this handy chart and the ranges listed for Las Vegas, you’ll quickly be able to nail down where the value for the money is.
Step 1 : DO YOUR HOMEWORK ON THE SOLAR COMPANY
The lowest price in the world won’t mean much if the company is not licensed to install solar in NV. Check their license HERE. They should have a C2 or a C2G in good standing and NO disciplinary action of any kind. Their license number should be on their bid, on their business card, on their website and on any marketing materials. If you cannot find a license for them, or the name on the license does not match the name on the bid, or if they tell you some other company is the licensed contractor doing the actual installation, that means you are talking to a lead generator or a marketing company. These are middlemen who will simply make your solar project cost more and take longer. It’s tempting to go for that super low price sometimes offered by unlicensed contractors or ones who are in trouble with the Board, but doing business with a non-licensed contractor is taking on a huge risk if they damage your home or do not complete the install as promised. Next, check their reviews. If you cannot find any reviews or there are a lot of bad ones, move to the next company on your list. Last, look for any add on fees such as monthly monitoring costs, pigeon proofing or warranty extension fees.
Step 2: COMPARE EQUIPMENT TYPES
Are you comparing apples-to-apples or apples-to-oranges? Are the companies using monocrystalline or polycrystalline panels? What type of inverters are they using? How many watts are in the panels? Mono panels paired with long lasting, trouble-free mircoinverters will deliver more power over the life of your system than any other configuration.
Step 3: COMPARE VALUE FOR THE MONEY
These four numbers on the bid are the most important for figuring out where the best value for the money is.
Cost per Watt, Net Cost, Kilowatt Hours produced in Year 1 and Payback Time.
COST PER WATT:
Solar prices are quoted as an “all in” price. It includes the panels, inverters, racking, labor, permits, engineering, HOA, clips, rails, clamps, warranty costs, overhead, insurance and everything else that goes into installing your system. Cost per watt is the unit price – like the price for a gallon of gas. You’re going to buy the whole tank, but you decide which station to stop at based on who has the lowest price per gallon.
Figuring out cost per watt is easy.
Cost of system/how many watts are in the system = Cost Per Watt
Here’s an example: $35,989/ 12.21 kw or 12,210 watts = $2.94 per watt
In Las Vegas, the average COST PER WATT for solar is $2.94 (source: energysage.com) You should be seeing prices between $2.80 – $3.20 a watt. If you see a price outside this range, you should be asking lots of questions. Companies selling far below average might not have the financial strength to be here to take care of you or may be desperate for work or using cheap equipment. Companies selling above the average may be hiding financing fees or subcontracting costs in the price.
The cost for the system after the NV Energy rebate and the federal solar tax credit. This is the true out of pocket cost for your system.
What if the proposal does not show a NV Energy rebate amount?
When you go solar, you can choose to receive an upfront cash rebate from NV Energy or to get Portfolio Energy Credits (PECs) each year. If you do not see a NV Energy rebate listed on your proposal, that means you are electing to keep the PECs or the contractor is keeping them. These used to have a resale value in Nevada, but that is no longer the case. If you or the contractor keeps them, you are forfeiting the rebate, which is guaranteed money. Click here for more info on PECs, the NV Energy rebate and the solar tax credit.
KWH PRODUCED IN YEAR 1:
When you go solar, you are buying equipment and installation expertise, but what you are really after is cheaper, cleaner kilowatt hours! So the real value in a system is how much power you get out of that equipment each year. The amount of power used being replaced by production from your solar system is shown on proposals as an Offset %. They should clearly list how many kilowatt hours the system is expected to produce in the first year.
PRO TIP Check their math! Before you can compare the annual output of the systems you are looking at, first you need to check that their projections match what you actually use, not an average or an estimate. You can get a good idea of your annual use number by looking at your NV Energy bill. There is a bar graph in the upper left corner. Simply take the average kwh per day and multiply it by 30, then add up the totals. If your total and their total are more than 500 kwh different, that is a red flag that other things in the proposal might be inaccurate as well. Next, check their production totals by using the National Renewable Energy Lab PVwatts calculator. No matter how low the price is, if the annual use numbers or production numbers are wrong, what else would be wrong about the deal they are offering? Once you’ve checked the math, now you can compare value. Obviously, since solar costs less than getting power from traditional sources and it NEVER goes up in price, more solar is better. A system that delivers 75% of your annual power use is not as good of a value as a system that delivers 101% of your needs.
PAYBACK IN YEARS:
Net Cost of System/Annual Cost of Power Produced by the System = Payback Time in Years
In Las Vegas, payback time averages 8-14 years for a system purchased outright. This number might not be listed on your proposal, but it’s really easy to figure out. You just divide the annual cost of power the system makes into the net cost of the system to see how many years of full price power it would take to equal the net cost of your solar. Since power rates from NV Energy can go up or down, we’ll use today’s per kwh price to estimate payback time.
This system makes 16,849 kwh annually. Right now, NV Energy charges 11.5 cents a kwh (including basic connection, taxes and fees), so the value of that power is $1,937. The system you are evaluating costs $17,675 after the rebate and tax credit is applied.
$17,675/$1,937 = 9.12 year payback
This system makes 12,496 kwh annually. At 11.5 cents a kwh, the value of that power is $1,437. The system you are evaluating costs $21,203 after the rebate and tax credit is applied.
$21,203/$1,437 = 14.75 year payback
Clearly, System A is the better value in this example.