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| Nick Hofmeister's home uses 24 photovoltaic (PV) panels to generate an estimated 7,500 kilowatt hours of electricity annually. (Photo/Joe Hornaday/Greenfield Daily Reporter) |
jhornaday@greenfieldreporter.com
McCORDSVILLE – In an effort to help the environment while at the same time lower their energy bills, Nick and Lisa Hofmeister have recently turned the roof of their McCordsville home into a small power station.
The residence now utilizes 24 photovoltaic panels to generate an estimated 7,500 kilowatt hours by harnessing the energy delivered by the galaxy’s largest power supplier – the sun.
“It’s something I had considered for a long time,” Nick Hofmeister said. “With all the talk on the consumption of natural resources and the impact on our environment as a whole, our family made a conscience effort to make some changes around the house. If there was an option that would help us reduce our long term expenses while reducing pollution, we should consider it.”
Though the Hofmeisters sought a way for their home to run on cleaner energy, part of their green effort was stimulated by the green that was leaving their wallets. They also wanted to decrease their energy bills.
According to Nick Hofmeister, during the past eight years, the family had taken several steps to reduce their electrical consumption, and were successful in decreasing their usage by 20 percent. Their efforts might have made things easier on the town’s electrical grid, it did little to help their bills.
“Our electric bill still grew from $75 a month to an average of $153,” Nick Hofmeister explained. “Once I realized the impact on my wallet, I started an all-out project to find a way to control current and future utility expenses.”
And that is when he began the necessary steps to make the solar power project a reality.
“I researched options and companies on Indiana Renewable Energy Association and Midwest Renewable Energy Association’s websites,” he explained.
After crunching the numbers, he realized that the implementation of any reduced-energy project was going to be costly. The Hofmeisters ended up fronting about $25,000 to make the solar panels happen.
“The upfront cost stings a little bit,” Hofmeister said. “It was the main reason I decided to take a class. I wanted to make sure I understood the investment I was considering.”
He traveled to the Midwest Renewable Energy Association and took a class on renewable energy so that he could better understand the technology and the impact it would have on both his life and bank account.
Initally, Hofmeister was interested in both wind and solar energy, before deciding that solar power was the way to go for his plan. Wind power was ruled out because it was not going to be asthetically appropriate in his McCordsville neighborhood. A wind tower needs to be about 80 feet in the air and the wind has to be blowing at least 20 miles an hour to work. The wind turbine would also be very noisy.
“I pursued solar panels because the back of my house faces south. I could fit enough panels on the back of my house to cover at least 50 percent of my electrical needs,” Hofmeister said.
And with some adjustments, he could one day get up to 75 percent of his electrical needs covered.
After communicating with McCordsville officials to make sure the project met the permit and code requirements and ensuring that his original homeowner’s covenants did not restrict solar panel use, Hofmeister began looking at panel providers.
He asked several solar panel system installers to provide estimates and recommendations, before settling on Green Works Energy LLC out of Yorktown. Hofmeister started working with Ryan Stout and looked at the three options for solar energy: grid-tied; off-grid; and grid-tied with battery backup.
“I decided on the grid-tied solution,” Hofmeister explained.
Grid-tied panels use a combination of the production their own energy and then using the utility company’s power when the sun is not available. The off-grid solution uses a combination of solar panels, batteries and generators to provide the home with energy. The grid-tied with battery backup proposition allows the user to consume solar energy during the day and batteries at night while the utility company is used as a backup.
Initially, Hofmeister wanted to use the off-grid option, but was told by Stout that a truly cost-effective battery solution was still five to 10 years away.
Working with Hofmeister and Stout, Central Indiana Power’s engineering department devised a plan to create a safe interconnection of the solar panel generation equipment to the grid as well as a metering plan to allow the utility to “net-meter” the energy usage. By net-metering, the utility deducts any excess energy generated by the equipment from the member’s total energy usage for the billing cycle.
Even though the solar panels result in lower energy costs and provide a way to protect the environment, there are other advantages to harnessing the sun’s rays for power. Through 2016, Hofmeister will be able to get a 30 percent federal tax credit, and not just a deduction from income. He will be able to get back that money in taxes that he paid this year.
“I also learned that power companies that are owned by investors must create or buy energy created through renewable processes,” he said.
Companies can buy the energy credits from someone producing it, if they are unable to produce or buy the amount of actual energy from a renewable process.
“That meant that even though I am using the solar energy I create, I can sell them credit for creating the energy,” Hofmeister explained. “Whatever I produce more than I’m using, it goes back into the grid.”
Those “credit dollars” from energy companies are wide ranging currently, which is why the payoff on Hofmeister’s system could be anywhere from five to 11 years.
“We are just starting the process of setting up the sale of my credits. Once that is completed, I will be able to nail down the payback period.”
Once the system payback period is complete, there are a few things that could happen. Hofmeister will either make money on the system, produce enough energy and make enough by selling credits that his electricity is completely paid for, or produce enough energy that Hofmeister at least limits increases in his energy bill.
“Since the dawn of human kind, I don’t know that energy has ever reduced in cost. If it did, it didn’t last long. So I’m guessing that the long term impact of my system will be a much smaller utility bill than those not utilizing some sort of renewable energy production,” Hofmeister explained. “After we get it paid off, we will have control over the electricity bill.”
Even though the installation of solar panels was the right move for the Hofmeisters, it might not be the right thing for everyone. With a steep upfront cost, the investiture in renewable energy might not fit into many budgets.
“It’s not a cheap investment,” Hofmeister said. “If you are more concerned about the environment, or simply (reducing) natural resources consumed to produce energy, then don’t worry about the tax credit or selling the green credits and install it. If I ignored the tax credit and the option to sell the green credits, my system would have taken 25 years to pay off.”
Any Central Indiana Power customer who is interested in information about member owned generation can contact Central Indiana Power’s energy adviser Darrin Couch at 317-477-2218 or at couch@cipower.com .
Ryan Stout and GreenWorks Energy, LLC in Yorktown is a member of the Indiana Renewable Energy Association and Indiana Distributed Energy Advocates.
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