8 Costly Solar Mistakes to Avoid When You Design Your System

8 Costly Solar Mistakes to Avoid When You Design Your System

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Cheyenne Minard, Senior Sales and Design Tech
CHEYENNE MINARD, Senior Design and Sales Technician at Wholesale Solar​

Today we’re going to look at the most common mistakes we see from beginners who are just starting to research and design their own solar system.

Our goal with this article is to prevent common headaches and (potentially costly) problems that stem from poor system design.

Since we came online in 2002, we’ve talked to tens of thousands of people about going solar.

Many of those calls start the same way: someone’s just had “the epiphany.” They realized solar power not only helps the environment, but is actually cheaper than paying the utility company in the long run.

Sometimes, people are so eager to get started that they dive in headfirst. They research products, calculate a cost estimate, and start sketching panel layouts for their roof.

But solar system design is a lot more complex than it appears on the surface.

So when people try to design a system without doing the research, they sometimes make mistakes. Big, glaring, expensive mistakes.

I touched base with a few of my colleagues to brainstorm the most common solar mistakes and misconceptions people have when they first get in touch with us.

Here are the points that came up over and over again:

1. Improper system sizing

Sizing a solar system is more complex than it appears at face value.

If you’re just starting out with your research, you might think it’s as simple as looking at your latest energy bill, then buying enough panels to cover that usage.

But that would ignore factors like climate, panel orientation, shading, natural efficiency drop, and other things that impact the “true” output of your system.

That’s why we won’t sell complete systems to anyone until they’ve consulted with one of our in-house solar design techs.

During that conversation, we plan your system to account for the variables most people don’t think about. Some common ones are:

Efficiency

Panels have an efficiency rating, and they suffer a 0.5-1% efficiency drop every year. 20 years after you install it, your panels will be 10-20% less efficient. We design a bit of extra headroom into your system to account for the loss of efficiency.

Climate

Solar panels are tested in ideal conditions: an indoor factory with temperatures in the mid-70s. In the real world, your system can be exposed to much harsher conditions. High temperatures can reduce the amount of energy you generate.

Your location also dictates how many sun hours you get. The term “sun hours” doesn’t mean “how long the sun is in the sky.” It refers to the amount of time the sun is in the right position to generate peak energy. Most places get 4-6 sun hours per day, and the exact amount influences system sizing.

Voltage

Inverters and charge controllers have maximum and minimum voltage input windows. Panels and batteries have a voltage rating as well.

Your system needs to be designed at the right voltage based on the equipment being used and what it requires. We also account for things like temperature that can affect voltage and system performance.

If you don’t have the right voltage from your solar panels or battery bank, your system might not perform well or worse – you could damage expensive hardware.

Battery bank sizing

Mismatching your battery bank with your charging source is the most common issue when it comes to batteries, specifically with off-grid system sizing. Your array needs to supply enough power to keep the batteries charged, but not so much that they overcharge.

Too much current could damage your batteries from overcharging. On the other hand, undercharging your batteries can have an even worse effect.

Certain batteries need to be brought up to full charge on a regular basis. Leaving them at empty or partial charge for an extended period of time can cause the batteries to fail prematurely.

2. Confusing off-grid and grid-tie solar

Solar power allows you to generate your own energy, which means you won’t pay for power from the utility grid. People assume this means they will be “going off the grid,” but that’s not accurate.

In reality, most people are looking for a grid-tied solar system.

Here’s the distinction: your panels generate energy, but you need a way to store that energy for later use. If you have access to power lines, you can store the energy you generate in the utility grid. The utility company will credit you for extra power produced, and allow you to pull from the grid when you need it.

Off-grid properties have no access to power lines, so they need another method to store energy. That means off-grid systems need a battery bank to function. Batteries are expensive, but with no option to store power in the grid, they are mandatory for off-grid systems.

The bottom line is that saving money and being independent from the grid are mutually exclusive. Batteries eat into your ROI (return on investment), and grid-tied properties don’t need them.

You don’t need to go “off the grid” to get the benefits of solar power. If your property has access to power lines, grid-tied solar is the smartest option.

Why pay for batteries when the utility grid will take care of storage for you?

3. “Solar prevents power outages!”

You’re generating your own energy, so the lights should stay on during a power outage, right?

Unfortunately, that’s not the case with grid-tied solar systems. Although the power originates from your panels, it is still stored in the public utility grid.

When the grid power goes out, so does yours, because there’s no infrastructure to feed that power to your property.

The remedy for this is a grid-tied system with battery backup. When the power’s on, it functions like a normal grid-tied system. During an outage, a small backup battery bank kicks in to keep the lights on.

It costs a bit more, but the peace of mind is invaluable, especially if you live somewhere with extreme weather conditions or unreliable power from the grid.

4. “Solar is a bad investment” / “Solar isn’t feasible without the tax credit”

Look, solar isn’t cheap. It’s a 4 to 5 figure investment. We know that’s a big commitment.

But electricity from the power company isn’t cheap either, and it’s only going up in price.

The reality is when you look at the long-term value of owning a solar system, most grid-tied systems pay for themselves fairly quickly and actually make you a profit over the life of the warranty.

We explain how to calculate your payback period on our resource center page about the ROI of solar. But here’s the quick version:

Let’s use a system that costs $10,000 (to make the math easy). That would get you something like this 6.6kW system.

You get a 30% tax credit for going solar, so the out-of-pocket cost is $7000.

$10,000 – $3,000 = $7,000

A 6.6 kW system will offset around 900 kWh of energy usage per month. At a typical rate of 12 cents per kWh, that’s a utility bill of $108 per month.

900 kWh * 0.12 = $108

To calculate payback period, multiply this bill by 12 to get your annual energy savings (in this case, $1296). Divide that number into your system cost to calculate your payback period, the time it takes for your system to pay for itself entirely.

$7,000 / $1296 = 5.4 years

This system will pay for itself in about five and a half years. Most solar panel warranties last for 25 years, and inverters for 10 years. After you clear the payback point, your solar system starts to turn a profit for you.

This assumes you perform a DIY installation. If you hire an installer, you might pay them $1 a watt to set up your system. That would make your system cost $16,600 before the credit, and $11,620 after the 30% back. The math changes slightly:

$11620 / $1296 = 8.96 years

A 9-year payback period on a system with a 25-year warranty. Still not bad at all.

“But the tax credit is going away in 2022!” Yup, that’s true. And we hear people say subsidies are the only reason solar makes sense.

So just for fun, let’s try it one more time without the tax credit:

$16,660 / $1296 = 12.8 years

We’ve gone from 5.4 years to 12.8 years by hiring an installer and skipping the tax credit, and we’re still paying off the cost halfway through the life of the system.

Solar costs a fair bit of money up front, but no matter how you slice it, grid-tied solar can pay for itself long before the equipment wears out. The more expensive your power rates are, the quicker the payback period and ROI.

5. Leasing

Solar power is a sound investment…if you own your system.

When you lease your system from a third party through a Power Purchasing Agreement (PPA), the value of that investment pretty much vanishes.

We can think of a few reasons why leasing is a bad deal.

The first thing to understand is the lender owns the system, which means they’re eligible to claim all the incentives. You won’t see a penny from the 30% federal tax credit or any local rebates.

After you’ve been squeezed out of the incentives, you’ll also pay a premium rate to lease the panels, which includes interest. In all, you might find you paid twice as much to lease the system as it would cost to finance and own the system yourself.

Leasing also makes it more challenging to sell your home. You have to transfer the lease to the buyer upon sale. Or, you can pay off the remainder of the lease balance and add that amount to your asking price. Both options limit the pool of potential buyers for your home.

We explain more about why we think leasing is a bad idea in our article: Should you Buy, Lease or Loan?

6. Not planning ahead

I brought up the fact that most panels are warrantied for 25 years. That’s a long time to go without any big changes in your life.

When people start planning their system, everyone thinks about what they need right now. Not as many people think about how their needs will change in the future.

What happens when you have kids, build a new workshop, or buy an electric car that needs charging? You’ll start consuming more energy. So we always tell people to look to the future when you start planning your system.

Some things to think about:

Do you have space to expand the installation if necessary? For example, say your system takes up your whole roof. What happens when you want to add panels later but have nowhere to put them?

Is your system designed to be expandable? People often think, “hey, I’ll just add more panels!” without realizing the other parts of the system, like the inverter, need to be sized to match. Central inverters have a limit to the number of panels they can support, so it’s often not as simple as “just adding panels.”

Micro-inverters are a great option to facilitate expansion for grid-tied systems. They work on a one-to-one basis: each panel is paired with its own micro-inverter. When you want to add on, just pair another inverter / panel pairing and mount them onto your array.

For off-grid properties, you should also think carefully about battery sizing. Depending on the battery type and age, it might not be possible to expand your existing battery bank.

Lithium battery banks can be expanded, but lead-acid batteries have limited options for increasing storage capacity.

The reason? When you add new lead-acid batteries to an old bank, the new batteries absorb the characteristics of the old ones. The new batteries are essentially being aged prematurely.

Lithium batteries are the exception. They have an integrated circuit controlling the charge parameters. The old batteries charge independently from the new ones, so you don’t run into the same issue.

7. Overpaying for installation

When you start to think about going solar, the first option that comes to mind is a turnkey installation from a national provider like Tesla, Vivint, Sunrun, or SunPower.

They offer an all-in-one solution to design your system, source your parts and install it for you. You can’t beat the convenience, but you also pay a premium for the catered experience.

Turnkey installers charge you anywhere from 100-200% of the cost of equipment to install your system. For a system worth $10,000 in equipment, they may charge another $20,000 to install it.

Big solar installers need to charge this premium to cover advertising, office rent, insurance, labor, and other expenses required to run their business on a national scale.

What many people don’t realize is that you can buy packaged solar systems from a wholesale distributor, then build it DIY-style or bring on a local contractor to help with part of the installation.

Working with a local contractor can save you a lot of money if you are willing to organize the project and take on some of the easy tasks. To help you find a local contractor to guide you through your project, we wrote an article about how to find a solar installer you can trust.

If you do choose to take on the project yourself, we also recommend fielding quotes from multiple installers before you choose the one you’re comfortable with. Contractors charge quite a broad range of rates, depending on their specialty as well as the complexity of the project.

Even a rate difference of 25 cents per watt can change the bid by a couple thousand dollars. It’s smart to use a service like Solar Power Rocks to compare quotes from local installers and make sure you’re getting a fair bid.

8. Building a Frankenstein system

Finally, let’s talk about the phone call our system designers dread:

“I have an inverter from eBay and some panels I bought a few years back, can you help me build the rest of my system?”

A fair number of people hold out for great deals and acquire parts slowly over time, until they’re ready to slap all the parts together like some kind of solar-powered Frankenstein’s monster.

But just like with cars or computers, it’s not enough to have parts. You have to have the right parts that are compatible with each other.

Otherwise, you get…

  • inverters that are undersized for your panel output
  • panels that are different sizes and don’t fit together properly on the mount
  • components that don’t wire together because they have different connectors
  • a power center missing essential components like circuit breakers/disconnects, remote control, or monitoring hardware
  • a box of hodgepodge components that no one is willing to support because it was purchased from all over the Internet
  • …and countless other headaches

There’s a lot that can go wrong, but the bottom line is piecemeal systems like these can quickly turn into a disaster. Unless you start with a plan and stick to it, there’s no guarantee the parts you buy will ever work together.

How to Avoid These Costly Solar Mistakes

You might notice that you can’t actually buy a complete system from our website cart. We require that people get in touch for a design consultation first.

Why do we do it this way? Even though we don’t install equipment, we’re still responsible for designing your system properly. If we sold systems with incompatible parts, we’d get a bad reputation in a hurry.

Instead, we run the math on system sizing, plan for inefficiencies, check voltage requirements, provide wiring diagrams, and do whatever else it takes to make sure the system you build is going to work.

For off-grid systems, we even assemble pre-wired power centers in our warehouse so you don’t have to worry about piecing the components together.

Our advice: do as much research as you can to account for all possible variables. But before you pull the trigger on that big investment, run that design by a solar designer first. An experienced set of eyes could help you catch some potentially costly mistakes before it’s too late.

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