Monday, June 23, 2008
My Meter is Running Backwards
“Ulysses and the Hedge trimmer” (see below) notwithstanding, my house has 20 solar panels on its roof as of Friday and my meter is running backwards. The company that installed it is leasing it to me for (almost) no money down at about $125 a month for a 4 KwH system. (They will increase that by 3% a year for the 15 year term of the lease – which I figure is likely a lot less than how much the price of electricity is likely to rise.) If this seems painless, it is. And that made it much easier to do than paying cash upfront for a system that would have taken 15 years to pay for itself. So how do they do it? The system cost $36,000. The upfront cost was about $25,000 with federal and State subsidies. But as a commercial lease deal, the leasee can write down the investment. And in recent legislation it can write the whole thing down in 5 years even though it has an anticipated life of 15-20 years! But you have to wonder if this is a rational way to allocate the incentives for renewable energy.