Solar Energy FAQs
More City Light customers are showing interest in solar electric systems for their homes and businesses. Why?
- Solar electric systems are safe, reliable, pollution free, and use a renewable source of energy – the sun. Systems have no moving parts and are increasingly easy to install.
- The option of net metering, or interconnecting a customer generating system to the utility grid, makes solar electric systems more economically viable. When you generate more power than you need during a billing period, you earn an energy credit for later use.
- Federal tax credits and state renewable energy production incentives offer additional financial benefits for owning and operating a solar electric system.
Solar electricity is produced when sunlight reacts directly with semiconductor materials in solar electric cells, a process that frees electrons and creates an electrical current. Electricity is produced whenever the sun is shining, but more is produced when sunlight is intense (like on a clear sunny day) and direct (when the sun’s rays are perpendicular to the solar cells).Solar electric technology, which converts sunlight directly into electricity, should not to be confused with solar thermal systems designed to heat water.
People decide to buy solar electric systems for a variety of reasons. While many would not consider solar a good financial investment, it may make sense for others who wish to invest in a more sustainable future. Some are motivated to help preserve the environment and support the development of clean energy technologies. Others might consider solar electricity a property improvement. Whatever your reason, solar energy is widely thought to be the energy source of choice for the future.
Benefits of solar electricity:
- No fuel (no price risk)
- No water
- No noise
- High reliability
- Low maintenance
- Long life
- Modular and expandable
A solar electric system consists of basic components for generating and delivering electricity to the home or business. There are two fundamental types of solar electric systems: independent, or “off grid” systems, and interconnected, or “grid-tied” systems. Only grid-tied systems are covered here since most customers will choose to generate electricity in parallel with Seattle City Light’s distribution system. For systems less than 100 kilowatts (kW), grid-tied systems are often referred to as “net metered” systems.
Commonly used components are described below.
The basic building block of solar electric generation is the solar “cell.” Cells are wired together to produce a “module”, which looks like and is often called a “panel”. (This sometimes is confusing because panels also describe solar thermal systems for heating water.) Solar electric modules range in power output from about 10 watts to 400 watts. Many recent residential applications use modules that are 300 watts or more to minimize the number of modules and amount of wiring required. A group of modules wired together form a solar “array”. Various mounting rails and hardware are used to attach modules to a building or other support structure and are often called “racking”.
In addition to solar modules (not shown), a solar inverter, solar meter and AC & DC disconnect switches complete this solar electric system.
A solar electric system tied to the utility grid also requires an “inverter”; a power electronics device that converts direct current (DC) produced by the modules into conventional alternating current (AC). Modern inverters also provide important safety features to meet the latest National Electric Code standards, as well as monitoring and diagnostic capabilities. AC and DC power disconnect switches allow components to be safely shut down and isolated from the utility grid. These are increasingly incorporated into the newest inverter models.
Batteries are optional in a net metered system and are only used if a customer wants to provide backup power during utility power outages.
A separate utility-grade kilowatt-hour meter, or “production meter” is also optional but is required to receive City Light renewable energy production incentives (see question below on incentives).
Cost depends on a number of factors, but for conventional systems mounted on a sloped roof, cost is fairly proportional to size ranging from $3 – 5 per watt of capacity installed. Thus, a typical 3,000 watt or 3 kilowatt (kW) system would cost $9,000 – $15,000 installed. Other cost factors relate to design complexity, system configuration, equipment options, and contractor expertise. Systems that integrate solar cells into roofing or glazing materials or require special equipment to install cost more. Local solar electric providers can provide you with estimates or bids.
Unlike electricity purchased month to month, solar electricity comes with an initial investment but no monthly charges. It’s like paying for years-worth of electricity all at once. You’ll probably appreciate having lower electric bills as you harvest “free” electricity but the initial expense of a system may be considerable. Financing may be an option to help spread out initial system costs.
With net metering and remove federal and state incentives (see below) the economics of solar become more favorable.
Remember, if reducing energy costs is your prime concern, there are many energy conservation measures that offer shorter paybacks than solar. Visit City Light’s Conservation website for further information.
Dollar savings will depend on how much electricity is produced, when it is produced, and whether you qualify for additional incentives (see below). You can estimate how much electricity your system will produce using the following simple guideline for well sited (shade free) Seattle area systems:
Installed wattage = kWh generated per year
For example, a 3 kilowatt (3,000 watt) system will generate about 3,000 kWh in one year.
Small deviations from “ideal” system orientation (due south) and tilt (degrees) will not affect annual performance more than about 5%. However, annual electricity production may vary by up to 20% due to annual variations in local weather.
You could also ask your system provider for a written estimate of the average annual electricity production for any system proposed, which should take shading into account.
How much is that electricity worth? Seattle City Light net metering customers can reduce their energy charge to zero each billing period if they produce enough kWh to meet their needs. Each billing period, customers’ bills will carry a basic charge. If customers produce more than they consume, those kWh are credited for future use. Per the net metering law, kWh credits can be rolled forward monthly until April 30th each year. On that date, all kWh banked credit is reset to zero kWh, and the new year begins.
Seattle City Light net metering customers receive retail value for their solar electricity.
Yes, the following incentives are available for City Light customers. Further information is provided in the Guide to Installing a Solar Electric System.
- City Light Net Metering – When you install your solar electric system in compliance with City Light Interconnection Standards and sign an Interconnection Agreement, any solar electricity you generate that is not immediately needed goes back into City Light’s grid, lowering your electric bill. Meter readings by City Light record a customer’s “net” electricity use. At the end of any billing period, if overall electricity production exceeds consumption (indicated by a negative meter read) a billing credit at current retail rates is applied to your next bill.
- Federal Tax Incentives – The federal Energy Policy Act of 2005, as amended by the Emergency Economic Stabilization Act of 2008, includes provisions for individuals and businesses to claim a 30% federal income tax credit for the cost of solar technology installations. Credit applies to the basis remaining after any utility or state incentives have been taken. Reference IRS Form 5695 for residential energy credits and IRS Form 3468 for business investment credits. Contact the U.S. Internal Revenue Service for further information.
- Renewable Energy Production Incentives – Incentive rates for the state program are based on the fiscal year that the system is certified, project type, and made-in-Washington bonus. Incentive rates are listed in the chart below. This is a production-based incentive. City Light will report annual production of your system to the WSU Energy Program. WSU will then calculate your incentive for that fiscal year and share this with City Light, who will then provide incentives payments by Dec. 15 of that fiscal year. A fiscal year runs from July 1 to June 30. Certification of a new system may take up to 30 days from date of submission. WSU encourages applicants to submit your application when the renewable energy system passes final electrical inspection.
Solar Incentive Rate Schedule
|Fiscal Year of System Certification||Base Rate - Residential||Base Rate - Commercial||Base Rate - Community Solar||Base Rate - Shared Commercial||Made in Washington Bonus|
The state’s utilities pay production incentives to qualified solar-generating customers (including community solar participants) within their service territories and earn a tax credit equal to the cost of the payments. The tax credit that the utility may claim cannot exceed 1.5% of the utility’s taxable power sales. The State may close the incentive to new customers before 2021 if the utility and/or state-wide cap is approached. For details, please see RCW 82.16.130.
To get the most benefit from a system, a well-designed solar electric system has clear and unobstructed access to the sun for most of the day, throughout the year. You can make an initial assessment yourself, and if the site looks promising, your solar electric provider has the tools to trace the sun’s path at your site and offer a more complete assessment.
Is your site free from shade by trees, roof lines, nearby buildings, or other obstructions in the surrounding landscape? Remember that an area that is unshaded during one part of the day, may be shaded during another. Even small objects, e.g. a utility or flagpole, can result in significant shade losses. As little as 10 percent shade on a module can reduce output by as much as 80 percent.
Other factors aside, the best orientation (direction) for a solar electric system is south, where the sun spends most of its time, and therefore south-facing roof installations are most common. Roofs that face east or west may be acceptable but generate about 20% less electricity.
The amount of space needed by a solar electric system is directly related to the type and size of the system you purchase. One attractive feature of solar electricity is that systems may be sized for almost any application or power requirement. So, you should be able to find at least a small area that has good solar exposure. Of course, larger systems will provide a greater percentage of your annual electricity needs.
Most residential systems now operating in Seattle range in size from 4 to 7 kilowatts (kW), but smaller or larger systems are feasible. A 1 kW watt system might require as little as 80 square feet of roof area for 4 typical modules. A 10 kW system may require as much as 1,000 square feet.
If your area is limited, you might consider using more efficient solar modules, which provide more watts/unit of area but cost about the same per watt. System sizing is discussed further below and should also be discussed with your solar electric provider.
Roof type, slope and condition may influence the solar equipment you select. While a solar electric system can be installed on any type of roof, some roof types are simpler and less expensive to work with. Typically, composition shingles and moderate to low slopes are easiest to work with. Steep, slate roofs are most difficult. In any case, an experienced solar installer will be familiar with all roof types and installation techniques that eliminate any possibility of roof leakage. Ask your installer how the solar electric system may affect your roof warranty. If your roof is older and needs to be replaced in the near future, you may want to defer installation of a solar electric system to avoid having to remove and reinstall the system.
One trend in solar electric systems are solar-producing materials that can be integrated into the roof or glazing components of a building. Options include three-tab solar shingles, flat solar tiles with lap-joints, solar material that comes in rolls and lies between raised-seam metal roof sections, and thin-film solar wafers that go between two panes of glass but allow some light to pass. These materials are pricey but could offset the cost of conventional materials they replace.
You could examine electric bills over the past year and work with your solar electric provider to estimate the size of the system needed to achieve a certain percentage of your household’s annual electricity needs. This might be a good time to consider energy efficiency measures (appliance upgrades, etc.) to lower your electricity use and boost the percentage contribution of your solar system.
To qualify for net metering your solar electric system must not be larger than 100 kilowatts of peak generating capacity.
A battery system to provide back-up power in case of a utility power outage may sound attractive, but add cost and complexity to the system. Batteries will require regular maintenance and more frequent replacement than most other system components.
Thin film solar cells built into the glass do double duty by providing shade and electricity at the Ballard Neighborhood Service Center.
Consider the “economies of scale” that can decrease the cost per watt as you increase the size of the system. For example, many inverters are sized for systems up 2.5 or 3 kilowatts, and if your array is smaller, say 1 kilowatt, you may still end up buying the same inverter. Labor costs for a small system may be nearly as much as those for a larger system. For example, your solar electric provider is likely to offer you a better price to install a 2 kilowatt system all at once, than to install a 1 kilowatt system this year and another similar system next year, since multiple orders and site visits add cost.
Although there are some special programs available for financing solar and other renewable energy investments, the best way to finance solar electric systems for homes is through a mortgage loan. Mortgage financing options include your primary mortgage, a second mortgage such as a U.S. Department of Housing and Urban Development (HUD) Title 1 loan, or a home-equity loan that is secured by your property. There are two advantages to mortgage financing. First, mortgage financing usually provides longer terms and lower interest rates than other loans such as conventional bank loans. Second, the interest paid on a mortgage loan is generally deductible on your federal income tax (subject to certain conditions).
If you choose to install a solar electric system at the same time that you build, buy, or refinance your home, by including the cost of the solar electric system in your mortgage loan you can avoid additional loan application forms or fees. If mortgage financing is not available, look for other sources of financing, such as conventional bank loans. Remember to look for the best possible combination of low rate and long term. This will allow you to amortize your solar electric system as inexpensively as possible. The terms and conditions of your financing are likely to be the most important factor in determining the effective price of your solar electric power.
Solar electric systems purchased for business applications are probably best financed through a company’s existing sources of funds for capital purchases – often Small Business Administration loans or conventional bank loans.
There are many contractors to choose from, and while City Light does not endorse or refer contractors, Solar Installers of Washington maintains a list of possible qualified installers for your consideration. We recommend obtaining a minimum of three (3) bids.
Compile a list of prospective solar electric providers. You might first consider those closest to you, because the contractors travel costs might add to your system price. Next, contact these providers and find out what products and services they offer. At minimum, find out the following:
- Is the company properly licensed? This usually means that either the company or a subcontractor has an electrical contractor’s license. The Washington State Department of Labor and Industries website includes tools for hiring an electrical contractor. You can look up if a contractor is licensed, bonded & insured, and if they have committed any infractions.
- How many grid-tied solar electric systems has the contractor installed? Experience installing grid-tied systems should be considered valuable but not mandatory. Since grid-tied systems are relatively uncommon (although this is starting to change), many contractors with solar electric experience have worked only on systems such as those that power remote homes far from the nearest utility line. These contractors may have experience with all aspects of solar electric system installation except the connection to the utility grid. Although grid-connection work is different from off-grid work, a reputable company with solar electric experience should not be eliminated just because it has not installed grid-connected solar electric systems in the past.Other forms of documenting installer experience might include: a solar contractor specialty license issued by a local building jurisdiction; certification by a group such as a state chapter of the Solar Energy Industries Association; or, a letter from a solar electric system manufacturer stating that the installer has experience and/or training necessary to install the system properly.
First, ensure that all of the bids are made on the same basis. For example, comparing a bid for a system mounted on the ground with another bid for a rooftop system is like comparing apples to oranges. Bids should cover the total cost of getting the solar electric system up and running, including hardware, installation, connection to the grid, permitting, sales tax, and warranty. Bids should clearly state the maximum generating capacity of the system measured in watts or kilowatts. If possible, have the bids specify the system capacity in “AC watts” under a standard set of test conditions, or specify the output of the system at the inverter.
You may want to obtain an estimate of the amount of electricity that the system will generate on an annual basis measured in kilowatt-hours. Because generation depends on climate – which varies year to year – it is unrealistic to expect a specific or guaranteed amount. A range of ± 20% is more realistic.
Warranty is an important factor for evaluating bids. Some rebate programs (none in Seattle) require that systems be covered by, say, a two-year parts-and-labor written installation warranty, in addition to any manufacturers’ warranties on specific components. The installer may offer longer warranties. Ask yourself, “Will this company remain in business to stand behind any manufacturer or installation warranties?”
Price should not be your only consideration. Often, you get what you pay for. Remember that a solar electric company is a business just like any other, with overhead and operating expenses that must be covered. It’s always possible that a low price could be a sign of inexperience. Companies that plan to stay in business must charge enough for their products and services to cover their costs, plus a fair profit margin.
City Light customers will need an electrical permit from the Seattle Department of Construction and Inspections (SDCI) or respective local jurisdiction, to meet City Light’s requirements for net metering (see information on net metering, below). An electrical permit is required to qualify for Washington State’s production incentive program. You may also need a building or land use permit depending on the size and complexity of the installation. Tip 420 by Seattle Department of Construction and Inspections (SDCI) is a good resource for learning more about permitting and installation requirements for solar electric systems in Seattle.
If you live in a community in which a homeowners association requires approval for solar installations, you or your solar electric provider may need to submit additional plans.
Typically, your solar electric provider will take care of all required permits and include the cost into the overall system price. However, in some cases, your solar electric provider may not know how much time or money will be involved in obtaining required permits. If so, this task may be priced on a time-and-materials basis, particularly if additional drawings or calculations must be provided to the permitting agency. In any case, make sure the permitting costs and responsibilities are addressed at the start with your solar electric provider.
Code requirements for solar electric systems vary somewhat from one jurisdiction to the next, but most are based on the National Electrical Code (NEC). NEC Article 690 carefully spells out requirements for designing and installing safe, reliable, code-compliant solar electric systems. Because most local code requirements are based on the NEC, your building inspector is likely to rely on Article 690 for guidance in determining whether your solar electric system has been properly designed and installed.
If you are among the first people in your community to install a grid-tied solar electric system, your local building department may not have approved one of these systems. If this is the case, you and your solar electric provider can speed the process by working closely and cooperatively with your local building officials to help educate them about the technology and its characteristics.
Net metering is a billing program where customers pay for their “net” amount of electricity consumed during a billing period. This allows customers to return excess power to the utility if their system is producing more than they use. When you return electricity, you receive a kilowatt-hour (kWh) credit for future use. This requires a meter that can read delivered and returned electricity. A net meter is like two meters in one and can register electricity whether you are consuming or returning power.
- If the kWh usage is a positive number, it means that the renewable energy system generated part of the power needed to meet your total consumption for the billing period, and the utility provided the rest. You will be billed energy charges for the net metered consumption, shown as kWh usage less any kWh credits applied from their previous net metering balance.
- If the kWh usage is a negative number, this means that the renewable energy system generated more power than your total consumption, and you sent excess generation to the utility. The kWh excess will be added to your net meter credit balance to help reduce the consumption for future billing periods.
A kWh credit is the excess kWh that a customer generated and did not use during a given billing period. This kWh credit is added to the net meter balance to be applied to consumption in future billing periods. Most customers will accumulate kWh credits in the summer months and begin using any available kWh credit in the fall and winter.
If you have zero or negative kWh usage, you will not be billed energy charges and excess kWh will be added to your net meter balance as a kWh credit for future use. If at any point later in the net metering year, more power is consumed than the system has generated at the end of the billing period, you will be billed energy charges for the kWh usage less any kWh credits available in your net meter balance. If there are not enough kWh credits to cover the total kWh usage in a billing period, then you will be billed for energy charges on the remaining billable kWh. The value of kWh credits depends on the retail power rate which varies by customer class, time of year, and usage.
You can contact Seattle City Light by phone at 206-684-5516 or email at firstname.lastname@example.org.
The kWh credits are for excess power generated that is returned to the electric grid. Many customers will carry a zero-kWh credit most the year and will only accumulate kWh credits during the summer months when more electricity is being generated than consumed. You will always use the electricity from your renewable energy system first, so the kWh that you generate and consume reduces the electricity you would otherwise be supplied from the utility.
Per state law any remaining kWh credits accumulated in the previous net meter year will be forfeited on April 30th. Customers should be minimally affected by this reset.
State law states that on “April 30th of each calendar year, any remaining unused kilowatt-hour credit accumulated during the previous calendar year shall be granted to the electric utility, without any compensation to the customer-generator.”
No. The state incentive is paid based on your annual solar production and is separate from net metering.
Net metering is a utility billing program allowing for the exchange of kWh credits. Net Metering lowers customer’s utility bills. Separately, City Light, along with the Washington State University Energy Program administers the Washington state renewable energy production incentive on behalf of the state. Qualified customers may apply for annual payments based on their systems totally yearly production recorded on a production meter. The annual incentive is separate from your usage and billing.
An energy charge is the cost per billable kWh of the net consumption (electricity purchased from the utility) under an applicable rate schedule. If a customer generates more than they consume in a billing period, then the energy charge and associated taxes will drop to zero and excess generation (negative kWh usage) will be added to the net meter credit balance.
A base service charge applies to all residential customers and is associated with the cost of metering and billing a customer. Customers will see this fixed charge each billing period regardless of whether kWh usage is a positive or negative number, as shown on the statement. No statement will be billed less than the base service charge. As of January 1, 2018, the residential base service charge is about $11 per two-month billing period.
The production meter does not have any charges or usage listed under the production meter line item. The net billing meter will always be billed a base service charge and any applicable energy charges, which will be listed directly under the net billing meter line item. Please see the Net Meter Billing Example for details.
Most City Light customers will begin seeing Advanced Metering installation in 2018. These meters will give City Light the ability to read meters daily. This will benefit customers as it will provide more data that allows City Light as well as yourself the ability to track the power your system is consuming as well as excess generation that is being sent back to the electrical grid. Net metering customers are not eligible to opt out of Advanced Metering. You can learn more about Advanced Metering online at http://www.seattle.gov/light/ami/
Warranties are key to ensuring that your solar electric system will be repaired if something should malfunction during the warranty period. Be sure you know who is responsible for honoring the various warranties associated with your system – the manufacturer, provider (dealer) or installer (contractor). Your provider should disclose the warranty responsibility of each party. Know the financial arrangements, such as contractor’s bonds, that assure the warranty will be honored. A warranty does not guarantee that the company will remain in business to honor the warranty. To avoid any misunderstandings, be sure to read all warranties carefully and review the terms and conditions with your provider. Under some solar rebate programs, dealers must provide documentation that specifies information on system and component warranty coverage and claims procedures.
Seattle City Light (SCL)
Energy Advisor, 206-684-3800, SCLEnergyAdvisor@seattle.gov
Seattle Department of Construction and Inspections (SDCI)
Applicant Services Center – permit application and issuance, plan review
20th floor of Seattle Municipal Tower
700 Fifth Avenue, Seattle
Electrical Permits –