This is the time of year when we see a rush of applications from solar photovoltaic contractors hurrying to finish their projects by Dec. 31 so their customers can qualify for tax credits.
KIUC supports any measure — including the installation of a rooftop photovoltaic (PV) system — that helps our members cut their electric bills. It’s a priority of our cooperative’s strategic plan to lower the average residential bill by at least 10 percent.
However, we’re seeing interconnection applications for huge systems going on the rooftops of homes with modest electric bills.
We question whether our members are getting all of the information they need before signing long-term leases or laying out $25,000 or more for a PV system. And we’re increasingly concerned by the overheated sales tactics employed by some solar contractors.
For example, one contractor is running an ad that features a phony bill from “Kauai Island Utility Company” loaded up with fictional charges. The ad promises that a PV system will produce a zero bill. Not true. Even customers who generate more electricity than they use have to pay a minimum monthly charge of $13.50.
That minimum charge is subject to change and could increase. While KIUC hasn’t sought an increase in the charge, Hawaiian Electric Co. on Oahu is proposing a minimum charge of as much as $71 a month. The charge is based on the fact that it costs the utility a significant amount of money to provide service to customers, even those with PV on their roofs.
Keep in mind, the bigger the system, the bigger the profit for the contractor. Some convince clients to install a system that’s twice or three times bigger than their household needs by promising a “profit” from selling the excess electricity they generate to KIUC.
There’s no guarantee we’ll always buy excess electricity from rooftop solar systems, since we’re able to generate electricity more cheaply from our own utility-scale solar arrays.
And there’s no guarantee that the amount we pay today will be the same tomorrow or 10 years from now.
Salespeople use forecasts of high future utility rates to help inflate the benefits of a PV system.
Those projections are usually exaggerated. They run counter to our strategic plan, which calls for lowering bills over the next decade, as well as what we’re already experiencing as our large-scale solar projects come online.
Liquefied natural gas, as a substitute for oil, also holds promise, and we’re looking at offering lower rates during the peak hours of sunlight.
So you should carefully analyze the savings projections offered by solar salespeople before signing a contract. Ask them how the numbers change if the minimum monthly charge increases, or if the payments we make for excess electricity fall, or if KIUC’s rates decrease. Ask them if they’d be willing to sign a guarantee on their savings projections.
Remember, if something sounds too good to be true, it probably is.
There are many situations in which rooftop PV makes sound financial sense. We know there are contractors who stand behind their products and offer honest assessments of the benefits and risks.
But PV sales take place in an unregulated marketplace. There’s little recourse for those who get burned.
I invite you to call us if you’re considering a PV system. Using data from your smart meter, we can look at your average daily use, talk to you about your household and your habits, and give you some suggestions on what size system would provide the greatest benefit at the lowest cost.
A rooftop PV system could be one of the most expensive purchases you make. Do your homework, be conservative with the numbers and don’t get rushed into anything.
David Bissell is president and CEO of Kauai Island Utility Cooperative.