In the previous two posts, we studied the electrical production from our 26 module, 8.58 kW array from 2020 to 2023 and compared it against our electrical consumption for the 2020 solar year.
The actual monetary savings of our photovoltaic array over the first three years averaged $1,257 per year, which is slightly more than we expected. At this rate, we are on track to make our $10,047 investment on the array back by year eight.
Looking to the future, if this savings rate continues, the array will have also paid for most of the $31,971.04 roof project investment (the cornice repair, parapet repairs, and reroofing) by year 25.
Slicing and dicing the savings
Our solar installer, Lisa Albrecht from All Bright Solar, shared an Excel spreadsheet with me that allowed me to take a detailed look at our savings. I input the various charges from our electrical bill plus the electricity we pulled from the grid, the electricity we fed back into the grid, and our monthly rollover credits, and it shows me what I would have paid without our solar array versus what we actually paid.
Our savings per solar year (April 1st through to March 31) were as follows:
2020 solar year
2021 solar year
2022 solar year
Three year total
Our savings follow closely the Return on Investment (ROI) calculations that Lisa shared with us when planning the installation of our solar array.
Our out of pocket investment into the solar array was $10,047 after the various rebates. Subtracting the first year’s savings reduced our liability from $10,047 to $8,888 (prediction), or $8,871 (actual). In other words, our ROI for the first year exceeded the prediction by $17.
Subtracting the second year’s savings from the net gain/loss of the first year reduced our liability to $7,697 (prediction), or $7,638 (actual), with the ROI exceeding the prediction by $59 – and so on…
As I mentioned in a previous post, the state incentive we received is based on how much kilowatt hours our 8.58 kW photovoltaic array is predicted to produce over the first 15 years.
10% of that incentive is withheld until year 15 and released as long as we meet the predicted production target. Because our production is exceeding the prediction, it would be safe to assume that we can add another $1,160 incentive payout to year 15 in our ROI calculation.
So far we are on track to make our money back on our $10,047 investment by year eight, giving us an ROI of 12.5%. After that, we can pocket all the savings from our 8.58 kW photovoltaic array. If Lisa’s predictions hold true, we would also have saved around $31,838 on our electrical bills for our 4,500 sf building with its three apartments by year 25.
That $31,838 would cover 99.5% of the cost for our roof project (the reroofing, cornice repair, and parapet repairs).
That all said, I don’t expect to exactly meet these ROI targets, because the numbers don’t account for maintenance and repair costs we may face over the next 25 years. But we hope to get close to them.
At this point I feel I need to clarify again that the savings are not just because we bought into a renewable energy system and slapped a photovoltaic array onto our roof. These savings were made possible because our deep energy retrofit significantly reduced the overall energy load of our building first, which then was followed by a renewable energy investment.
We looked at the monitoring data from our inverter for our 26 module, 8.58 kW array in the previous post. To understand how the solar array production offsets our energy used, I compared it to our monthly usage data from our electrical bill for the solar year 2020 (April 1st, 2020 till March 31, 2021).
The table above shows the energy use data for our 4,500 sf building as a whole, and for each of the three households (apartments).
The solar array produced enough electricity to cover 85% of our total annual electricity consumption during the solar year 2020. It effectively reduced our electricity use to 679 kilowatt hours (kWh) per year per household, which was less than the average monthly Illinois household use of 728 kWh (Based on 2021 EIA data).
Our monthly bill per household for the solar year 2020 averaged $11.24 compared to the Illinois average of $95.56 for 2021 (Based on 2021 EIA data).
A key takeaway from these data is that even prior to factoring in any solar production, our deep energy retrofit has resulted in a 49% reduction in energy use when compared to the average Illinois energy consumption per household.
Once factoring in the photovoltaic array production our energy consumption was reduced by 92% compared to the Illinois average.
2020 solar year review
The gray column in the chart above represents the amount of kilowatt hours the 4,500 sf building with its three apartments/households used any given month. September was a low use month with only 633 kWh, while February was a high use month with 2,139 kWh.
The green (and orange) column reflects the kilowatt hour rollover month by month, which is a product of the net-metering agreement with our utility. It is the difference between kilowatt hours used and kilowatt hours produced and carried over to the next month.
Take April for example: The difference between the 825 kWh used and 1,094 kWh produced is 269 kWh (rollover). In May the difference is 463 kWh. Add the rollover of 269 kWh from April, and we end up with 732 kWh rollover for May, and so on.
From April to September, our production was exceeding our consumption, and we were building our rollover nest egg for the winter. Starting with October, our consumption exceeded our production, and we slowly began to eat into our rollover credits. By January, we had used up all rollover credits and started to run a deficit (-299 kWh), meaning that for the first time since April 1st 2020, we actually pulled energy from the grid for which we would be invoiced.
At the end of the solar year, the building had used a total of 13,428 kWh, which was offset by 11,390 kWh production from our photovoltaic roof array. That left us with a deficit of 2,038 kWh, for which we would be invoiced.
How does this compare?
Data published for 2021 by the U.S. Energy Information Administration (EIA) lists 10,632 kWh as the average annual electricity consumption for a U.S. residential utility customer. 2021 EIA data for Illinois lists an average annual consumption of 8,736 kWh per residential utility customer, or household.
kWh use per year
kWh use per month
U.S. household average
Illinois household average
One household in our building w/o solar
One household in our building household w/ solar
When adjusting the numbers for our building to a household basis for the solar year 2020, we get 4,476 kWh use per apartment per year. If we factor in our electrical production, we are down to 679 kWh per apartment per year. The numbers for our building include space conditioning (heating and cooling).
2020 solar year billing
Because the cost per kilowatt hour, service charges and net metering agreements vary by energy provider and service area, this section may be mostly useful to our Chicago readers.
Our electrical bills for the building for the solar year 2020 added up to $404.47.
As mentioned above, we did not pay for any electricity until our rollover credit ran out in January. We were still responsible for delivery charges on our bill (i.e. customer and meter charges). They averaged $12.83/month from April through December, leading to a total of $115.47. Delivery charges don’t go away because we are still connected to and benefit from the electrical grid.
For January, February, and March, we paid a total of $289 for the 2,038 kWh deficit we accumulated for the building over those three months.
The table below compares our average bills on a apartment/household basis to those for residential customers in Illinois, based on 2021 EIA data.
Average month bill
Average Electrical cost per year
One household in our building
More about our actual savings and ROI on our photovoltaic array in the next post.
We reached the point in our Chicago deep-energy-retrofit where we get to work on the renewable energy component: a solar electric system in our case. Needless to say that we are super excited.
The topic of renewable energy generally creates a lot of excitement and buzz. So let me throw in a word of caution:
If you are on a path to make your home more energy efficient, the renewable energy component should be at the very end of your list. First take steps to reduce the overall energy demand of your home, because this is where you get the biggest return on your investment.
A general rule of thumb that I have come across says: every $1 spent to improve the efficiency of a structure saves $3 to $5 on the cost of a renewable energy system. That said, I did not find any research that backs up this claim.
Nevertheless, it rings probable: I did an initial performance analysis back in 2012 and 2016. I took energy data of a building comparable to ours prior to any energy improvements and compared it to our energy usage. I converted both data sets to a square foot basis to get an apples to apples comparison.
By 2016 we had reduced our heating load by 80%, while our electrical consumption decreased by 57%. And keep in mind that we were still working on the building, meaning that there still were lingering inefficiencies.
The bottom line is a renewable energy system for our house would be 1/2 to 1/4 the size of what it would have been prior to any energy improvements. This translates into major cost savings.
And then there are spatial limitations to keep in mind.
Take a solar energy system, i.e. photovoltaic panels in an urban setting. The panels are typically mounted on the roof. But any given residential roof can only accommodate so many photovoltaic panels.
The lower the energy use of a home, the more likely that the panels on the roof cover the majority, if not all of the energy needs, which again translates into major cost savings.
How do you improve the energy efficiency of your home? I provided some guidelines in the previous post. But there is plenty of more information in this blog. Just search the blog for keywords like “building shell”, “insulation”, “air sealing”, “windows”, “heating”, “space conditioning”, “moisture management”, and “ventilation” and you will find plenty of reading material on energy efficiency strategies.
Ok, the “word of caution” turned into several paragraphs. In the next posts, I will get into the basics of solar PV and our journey to the system installed, including all preparations. Stay tuned!
The 2015 chart above from the U.S. Energy Information Administration shows that up to 54% of energy for a single family home can go towards space conditioning (i.e. space heating and cooling). Only 5% of energy goes towards lighting.
If you decide to make your lighting more efficient, i.e. go with all Energy Star LED lighting, I applaud you. However, the total resulting energy savings may be around 1-2%. That’s something you may barely notice on your electrical bill.
If instead you would focus on improvements to your building envelope, i.e. your basement floor, foundation walls, crawlspace, exterior walls, wall penetrations, windows, exterior doors, attic, and roof, you could make a major dent in the 54% of energy that goes towards your space conditioning. This is where you can get a big bang for your buck. And not only that, you likely end up with a home that is a whole lot less drafty and a whole lot more comfortable and healthy to live in.
The bottom line is, don’t focus on the low hanging fruit. Look at the big picture and focus on the energy hogs, such as space conditioning.
Verify and quantify
You decided to not just chip away at your energy use but instead to make a dent, maybe even a really big dent.
Based on the data above, you know that you likely need to focus on your building envelope in order to reduce your space conditioning loads. But how good or bad is your building envelope, and what is the actual space conditioning load for your home?
It’s time to find out. Commission a home energy audit. A professional energy auditor will visit and inspect your home, analyze your utility bills, and may run several tests such as a duct, furnace, and blower door test.
The energy audit report will point you to the areas where energy improvements can be most effective. The most significant recommendations will probably point you to building envelope improvements, such as insulating, air sealing, door or window replacement, etc.
With this data and recommendations in hand, you can begin to strategize.
You have a choice. Even basic insulation along with good air sealing (also called home weatherization) can save you an “average of 15% on heating and cooling costs (or an average of 11% on total energy costs)” according to Energy Star information.
Depending on how handy you are, weatherization can become a DIY project or you can hire a weatherization specialist that does the air sealing and insulating for you. If you hire someone, make sure that you contractually set performance goals based on the home energy audit. This means how much more air tight the house should be after the improvements and what cold spots should be eliminated with insulation. And at the end, go and verify. In other words, have your energy auditor come back to test that the performance goals are met.
You want to aim higher and save more? Good for you!
In this case I recommend commissioning an energy model, which your home energy auditor could provide. And if not, he or she can probably recommend someone. We commissioned an energy model in the planning phase of our project, which guided us through the decision making process.
An energy model takes a wide variety of building variables into account (type of windows, type of insulation, building exposure, air tightness, etc.) and predicts the energy load of your home. By adjusting the variables (i.e. thickness of insulation, type of windows, level of airtightness, etc.) you can see how the energy load of your home increases or decreases.
Say you want to decrease the energy load of your home by 50% or more, which puts you into the realm of deep energy retrofits. The energy model will help you to determine how to get there. It tells you what level of air tightness you need to achieve. It tells you what levels of insulation values you need, and where. It tells you what performance targets your windows and exterior doors should meet. And so on.
Decreasing your energy by 50% or more will involve major remodeling as you probably have to work on all exterior walls and the roof from the inside, the outside, or both.
Sounds daunting? Well, it can be. But there are silver linings here too.
Major remodeling allows you to get to all those quick fixes and deferred maintenance items that have been causing problems and eating money for years. And of course, you are left with major energy savings.
Take our deep energy retrofit. A preliminary analysis in 2016 showed a 80% reduction in our heating needs, and 57% reduction in our electrical use in 2012.
Be picky with your contractors
You will need help from various building trades with a deep energy retrofit. I highly recommend relying on contractors that specialize in energy improvements, or that are at least familiar with the topic. Working on energy improvements, such as in a deep energy retrofit, takes a very different mind set compared to regular construction, as the installation and construction processes often vary from the old norm. A recipe for disaster is a contractor that is set in the old ways, because that is how he/she has always done it.
Aiming high, such as with a deep energy retrofit, may seem expensive and overwhelming. You may think you should start in small increments instead.
Please think again.
Going about your improvements incrementally, each step in the process seems less overwhelming and less expensive. I’ll give you that. However you keep tiptoeing around big ticket items and associated savings (such as the above mentioned space conditioning). And you will likely end up undoing some of your own work along the process.
In the end, you may have spent cumulatively more on incremental improvements than on a deep energy retrofit with far less energy savings than you would have had if you didn’t tiptoe..
Learn how to operate your home
Owning a home, energy efficient or not, requires you to know how to operate it.
It is similar to owning a car: If you want to drive, you need to know how to start your car, how to steer it, how to accelerate and brake. You need to know what kind of gas you need, how to put gas in the tank, check tire pressure, check oil levels, etc.
The same is true for a home, in particular if you like to maximize your energy savings. You need to know when to change or clean which filters and when to schedule service appointments for what equipment. You will have to program and monitor your thermostat and other monitoring equipment. You should become familiar with the basics of indoor air quality (IAQ) and learn the basics about moisture management.
Owning a home is not a hands-off operation! There is no chauffeur. You need to drive if you intend to maximize your energy savings, assure the durability of your home and systems, and maintain a healthy and affordable living space.
Has the cabin fever set in by now? If so, let me lead a quick expedition into the hot and muggy summer months. Even though we may yearn for summer heat at this time of the year, once it is upon us, we are rapidly looking for ways to keep cool. How do you keep cool?
You could argue that any ceiling fan would do a good job as it is most likely to operate more efficiently than a conventional air conditioning system. This comparison is somewhat unfair as the product of air conditioning is different from that of a ceiling fan. But then again, humanity is famous for buying products that are non-essential.
We needed to make a decision about what ceiling fans we should acquire for our deep energy retrofit. I started by looking at the extremes. On one end there is the $25 product, cheap but flimsy, “delightfully” humming along while it moves air (for all those lovers of white noise), and dumping the one thing from the motor and light that we want the least – heat.
On the opposite spectrum is … well, other than expensive, I don’t really know. This is a good time to consult the EnergyStar product list for ceiling fans.
EnergyStar rates the efficiency of ceiling fans by how much air they move (cubic feet per minute or cfm) with one watt of energy. If you download the list of certified ceiling fans in Excel format, you can easily sort for the most efficient EnergyStar certified models. Here is a summary of the top three contenders as of February 2014:
There are plenty of other efficient ceiling fans on the EnergyStar list. But after my big time-waste tracking down an EnergyStar efficient range hood, I acquired an attitude. If I can’t find a product listed on the EnergyStar list in a simple online search, I move on.
Back to the top three contenders that were all easy to track down. The Haiku and MidwayECO are built with the efficient and very quiet electronically commutated motors (ECM’s). I assume that the Aeratron is also powered by an ECM, but couldn’t find corroborating information in the specifications.
The Aeratron is a ceiling fan unit only, while the Haiku can be fitted with a 1,500 lumen LED light module. The Midway ECO comes with a light module that takes four LED or CFL bulbs with the GU24 pin base. Tthe typical light output would be around 3,600 lumens. The Haiku can be dimmed as can the Midway ECO, as long as dimmable LED or CFL’s are used.
Prices for the models vary widely as of February 2014:
Haiku from $825 to $920
Midway ECO from $476 to $529
Aeratron from $224 to $349
Because we need dual functionality from our ceiling fans (air movement and light), the Midway ECO emerged as the best contender, even though it is still a very pricey piece of equipment.