Exciting New Solar Roofing Solution from Tesla/Solar City – How Much?

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Picture Credit: Solar City press photo

Leave it to Elon Musk and his engineers to being out another revolutionary product suite– solar roofing tiles that are attractive, efficient, can serve as snow melters and can be East-West mounted ! Very cool (Bloomberg video here) ! The solar roofing tiles are also complimented by SolarWall which provides residential standby power to combat outages. The tiles come in four configurations and consist of tempered glass, colored louver film and a high efficiency solar cell. ” Though geared to the residential market, SolarCity has scale: “SolarCity is the national leader in clean energy services and America’s #1 solar power provider. Our national scale, in-house experience and world-class technology are only a few of the solar energy advantages that make us the clean energy company of choice for small businesses, commercial companies, governments, schools, farms, water districts and more.”

SolarCity is operating as a de facto solar utility with the goal of making money on the financing. However, the economic payback periods are widely variable as “a 3 kW system starts at $25-$100 per month with an annual increase of 0-2.9% each year for 10-20 years, on approved credit,” according to SolarCity that will work with third party financing, though “our in-house team takes care of every part of your project, including financing, custom system engineering, installation and ongoing system maintenance and monitoring.” But, in addition to up-front costs, residential solar installations face the challenge of price distortions caused by net metering imposed from the local utility – you generate the power but they often take your WHOLE production onto the grid, charge you a distribution overhead, and then sell you back electricity from the grid ! Concerns about “cost shifting” have generated debates (like the NARUC “rate design”) with MIT Professor Richard Schmalensee claiming in a detailed report that it’s in solar’s “best interest” to do away with retail pricing in net metering policies, and to treat utility- and residential-scale solar “more or less the same.”  Several other reports have come to a similar conclusion, such as a recent report commissioned by the Louisiana Public Service Commission that drew ire from solar advocates. However, several more studies (including in Nevada, Vermont and Mississippi) have found just the opposite: that distributed solar does not impose a significant net cost to ratepayers, and in many cases produces a net benefit to all ratepayers, as reported in GreenTechMedia.

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Picture Credit: Solar City

So regulation, financing and the variability of the subsidies plus cash flow problems at SolarCity are key elements of execution risk as SC has to build a geographic infrastructure to support this network. Some experts are concerned about the lifetime system cost, projected to be as high as $100,000 by Consumer Reports. The Buffalo News explains their calculation and quotes Nick Gilewski, owner of Go Green Electronically, an e-commerce store based in North Tonawanda that sells energy efficient consumer products and favors geothermal energy in the northern U.S. states. Brian Potts of Perkins Cole LLP also notes that , “companies like Elon Musk’s SolarCity have flooded the market with cheap home solar deals, relying heavily on federal and state subsidies and creative loan agreements to keep prices low.”

However, the SC approach might work for community solar as it offers utility-scale photovoltaic (PV), battery deployments and advanced grid services (for distribution systems). Mr. Potts explains,

Shared solar systems offer many advantages over home rooftop solar systems. Rooftop solar is much less efficient; generally speaking, if you take a rooftop solar panel and put it into a utility-scale, shared solar system, it will produce more power. This is primarily due to siting considerations to capture solar energy, whereas utilities can site solar farms in a manner that maximizes the amount of energy they produce. Utilities also do a better job of cleaning and maintaining the systems to optimize performance. In fact, according to a recent Brattle Group study, rooftop solar is about twice as expensive on a per kWh basis as utility-scale solar, mainly due to these inefficiencies and economies of scale.

Putting solar panels on your house is part of a non-utility, off the grid system  that allows you to use your whole production in situ, along with other elements, according to HomePower online.

Nonetheless, $11 billionaire Elon Musk is a remarkable innovator and, as Forbes acknowledges that he “is trying to redefine transportation on earth and in space. Through Tesla Motors he is aiming to bring fully-electric vehicles to the mass market; at SpaceX, he launches satellites and is working to send humans to other planets.” Musk make innovation appealing as his pitch at Universal Studios in Los Angeles offered an integrated view of Musk’s clean-energy ambitions, as Bloomberg crows: “The audience was able to step into a future powered entirely by Tesla: a house topped with sculpted Tuscan solar tiles, where night-time electricity is stored in two sleek wall-hung Powerwall batteries, and where a Model 3 prototype electric car sits parked out front within reach of the home’s car charger.”

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Picture Credit: Tesla 3 Prototype

 

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