It is now possible to have solar energy for your home without upfront investment and have positive cash flow. Recent laws passed by the New Mexico Legislature and signed by Governor Richardson have significantly changed the financial benefits of solar energy for residences. The energy comes from solar photovoltaic (PV) panels on your roof that create electricity for your home. You don’t have to pay for the electricity the PV panels create, and, in fact, PNM will pay you extra for creating it!
Further, you are protected from future electricity rate increases.
Read the breakdown of costs and savings for an average home PV system in the right column >>
Bottom line…no upfront cost, no cash flow loss, protection from future rate increases AND clean energy. Now is the time to make the Santa Fe area into the Solar Capital.
by Margaret Gray
Want to reduce your energy consumption, greenhouse-gas footprint, and energy bills and increase energy efficiency? Well, did you know that on average, 65% of home energy bills in New Mexico are associated with producing domestic hot-water and home heating? You may or may not be aware of the fact that solar heat is more efficient than photovoltaic (PV), producing five times more useful energy than solar electric.
Much press is being given to PV distributed generation systems. PV is important. Don’t get me wrong: We at the Rio Grande Chapter are huge fans of PV. But less press is given to solar thermal systems – which might make more of an impact and difference to you and the environment.
In April, Santa Fe-based Cedar Mountain Solar Systems made a presentation to the Northern New Mexico Group on solar heating and hot-water systems. I went back to them for more information. According to Eric Robinson, director of business development for Cedar Mountain, solar thermal has been seen as being less flashy than PV, involving plumbing (the pipes and systems that deliver solar hot water and heating) rather than wiring, and has not been standardized the way that solar electric has. He untangled the process for me.
Energy efficiency is the easiest way to save money. Whether for a new or older home, simple things make a material difference: insulating your hot-water heater and outgoing pipes, adjusting water-heater temperature settings, buying low-flow showerheads, installing weather stripping, and caulking windows properly. Buying energy-efficient boilers and hot-water heaters save significant money. Start with an energy audit and do the easiest things first.
Between 20% and 25% of a typical Northern New Mexico home’s energy bill is spent heating water. Installing a solar domestic hot-water (SDHW) system will replace up to 90% of that usage (the sun doesn’t shine every day). Most systems pay for themselves within five to ten years and last 20 to 30 years, providing years of “free” energy while electricity, natural gas, and propane costs escalate. Federal and state tax credits will pay for 40% of the cost, and the rest is eligible for low-cost, long-term financing under the new solar taxing districts. Also, home equity values rise, as the Journal of Appraisers projects that every dollar saved in energy bills with energy-efficiency upgrades adds $20 to a home’s value.
I asked Eric to break this down for a family of four with a 120-gallon solar storage tank and two solar collectors. He calculates that an SDHW system would cost a total of $9,568, with a net cost of $5,741 after tax credits. The annual savings for the first year, depending on whether solar is offsetting propane, gas, or electric, could be as much as $500. The potential savings experienced over the life of the system with even conservative increases in fossil fuel prices could be tens of thousands of dollars. And home equity would increase by around $10,000. With a home-value increase larger than the net cost of $5,741, investment payback is immediate. The savings in pollution is roughly equivalent to the CO2 of a passenger car.
Installing a whole-home hydronic (water-based) solar system includes the installation of solar domestic hot water, a high-efficiency boiler for backup heating when solar is not available, infrastructure plumbing and control systems for solar heating, and the solar panels themselves. It is more difficult to calculate costs for retrofits as the quality of the construction, the size of the home, and the type of heating in use affect the systems installed. Full systems typically replace anywhere from 50% to 75% of associated energy costs.
To ease expense for a retrofit, a homeowner can phase construction in three parts: installing an SDHW system initially; replacing an old boiler with a new, high-efficiency boiler; and adding solar panels for home heating last. The first and third activities are covered by tax credits and are eligible for the solar district financing. The second phase is only partially eligible, with the costs associated with standard plumbing and heating ineligible for tax credits.
Eric estimates that a new Cedar Mountain Solar hydronic heating system for a family of four in a 2,500-square-foot home would be around $57,500, including a high-efficiency boiler, radiant-floor installation, domestic hot water, collectors, controls, zone valves, design, permitting, and labor. The part of the system taxable and ineligible for tax credits is $14,375. The remaining system cost eligible for tax credits, solar district financing, and tax exempt is $43,125, leaving a total net cost, after all applicable tax credits and incentives, at $39,650, for a total savings of $17,850.
Electric, natural gas, and propane prices are projected to rise and remain volatile as the recession diminishes. Gas prices have increased 50% since the beginning of 2009 and are subject to Middle East political and international-demand factors. If another natural disaster like Katrina strikes, prices may spike and supply wither. PNM is applying for another substantial rate increase, and its electricity demand projections for future decades are high. With cap and trade, renewable energy portfolio standards, and coal-pollution abatement decrees, cost pressures are expected to continue in order to reduce the greenhouse gases creating climate change.
With 65% of your energy bill devoted to hot water and home heating, there is real reason to implement energy efficiency, install domestic hot-water systems, and calculate the costs and potential benefits of a full home-heating system. It may be the best inflation insurance available, and with the tax credits and long-term (25 years) financing solar districts authorized, the most affordable as well.
Thanks to Cedar Mountain Solar Systems for the estimates. For more information, contact a solar hot-water and heating specialist near you.
The Rio Grande Chapter of the Sierra Club, the City of Santa Fe, and the Santa Fe Community Housing Trust are funding a pilot program (Energy Works) to implement energy efficiency in working family residences in Santa Fe. The Housing Trust coordinates the work in conjunction with Youth Works, Earth Works Institute and Los Amigos ERC.
Modeled after low-cost energy efficiency programs in other communities, this program goes the next step by adding a green jobs training component for marginalized youth populations. The young people employed through EnergyWorks are trained to provide free basic energy audits, weatherization and energy efficiency installations as well as general consumer education. The pilot program targeted 100 working families in Santa Fe.
The program model begins with canvassing by Sierra Club volunteers in neighborhoods built by the Housing Trust over the last 15 years. The Housing Trust former clients are generally low and moderate-income families and being familiar with the organization are generally more receptive to the program. Door hangers are left if no one is present at the time of canvassing. A youth intern at the Housing Trust then follows up to make appointments and answer any additional questions about the program that may have arisen.
Crews of generally two to three youth with a crew leader assess the home and then provide the materials installation which include up to 15 CFL light bulbs, hot water heater insulators, pipe insulation, low flow shower heads and faucet aerators, weather stripping and door sweeps, caulking around windows, power strips for electronic devices such as TV’s, DVD players to reduce phantom loads, and adjusting refrigerator and hot water heater temperatures.
The supervisor monitors installations, educates and explains to homeowners what the crews are doing and provides the homeowner with information about additional steps and programs that are available in the community. Total cost is estimated at $300 per household with materials costing roughly $100 and labor $200. Los Amigos ERC provided the initial training for the crews. The Housing Trust provided the training for the canvassers.
Materials were purchased by the Housing Trust and funded by the City of Santa Fe and the Sierra Club. The Housing Trust provides management, coordination, fundraising, scheduling, purchasing, and is the initiating force for the program. Youth Works and Earth Works Institute recruit the youth participating and provide their ongoing supervision and payment. Additionally, Youth Works participants attend two pertinent Santa Fe Community College green jobs courses and also work towards their GED’s if they do not have a diploma. Earth Works Institute participants train in several kinds of environmental work (such as remediation), of which this program is just one part.
Community benefits are multiple and provide several positive feedback loops. Working families receive free services and materials, free education, reduced utility bills, reduced carbon footprint, and suggested guidance for next steps. Youth receive training, education, meaningful work which can lead to green careers, positive experiences, exposure to community service, and workplace supervision, experience, and support. The community receives energy efficiency, reduced carbon footprints, reduced water usage, a cadre of trained youth to pursue further green jobs and green job training, reduction of unemployment and potential crime, young taxpayers, and free services from volunteers.
PNM has reduced the cost of the Sky Blue program from $0.0169/kWh to $0.0110kWh, a reduction of 35%. When a PNM customer participates in the Sky Blue program, PNM is required to increase its renewable energy production by that amount. This is in addition to their state law required Renewable Portfolio Standard requirements. So, when you participate, you cause an increase in renewable production and a decrease in fossil fuel production. We encourage you to increase your participation in this program. It should be noted that Sierra Club members Gail Ryba and Robb Thomson played a key role in getting this reduction to occur with the PRC.
On March 11, the City Council of Santa Fe approved a new Green Building Code for new residential construction by a vote of 8-0. This is a major step in the City’s commitment to the U.S. Mayors Climate Protection Agreement.
David Van Winkle, our group Chair spoke during the public hearing section of the meeting. He said: "First, this Green Building Code reduces energy consumption by 50% and improves other measures of sustainability for new residences. It calls for basic building approaches that are tailored to the climate here in Santa Fe –
Bottom line…building green is basically building it right. It is cost effective and provides for a better living environment for the occupants.
Second, thank you to all who contributed to this proposal. The proposed ordinance is excellent, and the resolutions also call for ongoing review of the ordinance to meet the long term goals of zero energy consumption for new construction by 2030. Special thanks to Katherine Mortimer and other city staff, and Kim Shanahan, Executive Director of the Santa Fe Home Builders Association, who led this effort.
Third, while this code is a great step forward, we still have another big elephant in the room. Existing buildings will consume 90% of the energy ten years from now. Kim and Katherine are leading team efforts to start writing a code for existing buildings. I solicit the support of the City to get this project on the fast track".
Council members asked about how fast that this code for existing buildings could happen. Katherine Mortimer replied by saying that since the teams have the experience of writing the code for new construction, that the new code for existing buildings could be ready in several months.
I would like to thank everyone who participated in creating and getting this new ordinance passed, as this has been one our major priorities over the past year. Sierra Club members Brendan Miller and Jim Hannan played key roles.
Washington, D.C. The Interior Department today announced that it would cancel leases issued under the Bush administration that would have allowed oil and gas drilling on more than 100,000 acres of Utah wild lands, much of it surrounding iconic treasures like Arches National Park.
Since December, the Sierra Club and a coalition of environmental groups have been working to protect areas near Arches and Canyonlands National Parks, Dinosaur National Monument, and rock art-rich Nine Mile Canyon from oil and gas drilling. In December, the coalition filed suit to stop the leasing, and, in January, Judge Ricardo M. Urbina of the U.S. District Court granted a temporary restraining order preventing the Bureau of Land Management (BLM) from moving forward with these leases.
Today, Interior Secretary Ken Salazar announced that the agency would cancel the leases.
"Today's announcement by Secretary Salazar signals a new era in the way our natural resources are managed. The Obama administration clearly understands that instead of allowing the oil industry to destroy places like Arches National Park, we should be investing in the kind of clean energy solutions that curb global warming and leave our natural treasures intact."
The City of Santa Fe and Homewise have partnered on an innovative project which makes $550,000 available for low-interest financing to make middle and low income homes more energy efficient.
Energy efficient home improvements are the lowest hanging fruit when it comes to reducing energy use and greenhouse gas emissions, not to mention that many of these projects will increase the value of homes and save homeowners money over time.
These energy efficient loans made available by the City of Santa Fe and Homewise can be used for projects including: roof replacement with insulation, Energy Star appliances, high efficiency water heaters, stucco replacement with insulation, high efficiency furnace replacement, solar domestic hot water, solar electric PV, solar thermal and solar air heating. For more information about the Energy Efficiency Loan Program go to Homewise website
Here’s an example to demonstrate how the federal and state incentives combine to make solar energy systems more affordable.