An increasing number of Crozet area homeowners are flipping the switch to solar power as a federal energy tax credit shrinks and climate issues gain momentum on the world stage.
“It’s truly remarkable,” said Greg Slater, an associate broker with Nest Realty since 2012. “Just driving around is the easy way to notice what’s happening. It’s growing every month, every year. People are interested in solar.”
Solar installers say they can barely keep up with the demand.
“We’re definitely busy in the Crozet area,” said Ryann Coles, marketing director for Altenergy, Inc. of Charlottesville. “We used to say that solar is the future. Well, it’s now and it’s becoming more mainstream.” She said her company regularly sends out two crews to tackle two projects each on a weekly basis.
“I think customers are really looking at the investment and realizing it is a sound, solid investment,” Coles said. “And when they go solar, their neighbors are interested.”
Altenergy is one of several solar companies doing business in the area. Others include Sigora Solar, POWERHOME Solar and Encōr Solar. Jason Leffler, regional sales manager for Sigora, said his company also has seen an uptick in demand.
“We’ve been growing at a rate of 250-300% per year—year over year for the past four years,” Leffler said. “Crozet is leading the way. We probably have more solar installed in Crozet per capita than anywhere else in Virginia.”
He said it may be partly due to the demographics of the area. “Crozet is growing in a certain type of family that is conscious about the environment. They plan on being here for a long time and it just makes sense for them.”
For most customers, it comes down to two reasons—“doing what feels right for the environment and saving money,” Leffler said. “They are seeing so much solar go up and somebody like Greta comes through on a press tour, so they are looking into it.”
Leffler is referring to Greta Thunberg, the Swedish teen who became the symbol for young climate activists when she sparked student walkouts worldwide to draw attention to the issue. In September, her trip to the United Nations climate summit received widespread attention when she opted to sail across the Atlantic instead of fly to reduce her carbon footprint on the environment.
“A lot of people didn’t understand that they could actually afford to go solar,” Leffler added. “It’s as simple as swapping out your electricity bill to finance your solar panels.”
As a financial incentive, the federal government began offering a 30% energy tax credit for the cost of converting to solar power. After Dec. 31, that credit will be reduced to 26% in 2020 and 22% in 2021. In 2022, the energy credit disappears.
Most solar companies are touting low financing and no money down on loans for buying their solar energy systems. For example, if the homeowner takes out a loan for $45,000 to pay for solar panels in 2019, the 30% credit would amount to $13,500. The homeowner would see their 2019 tax bill reduced by that amount or receive a rebate check if the credit is more than they owed the IRS.
“What makes solar so easy is that there is no up-front cost to go solar,” Leffler explained. “The idea is to secure a loan, and your down payment isn’t due for, give or take, 18 months. That gives you time to get your tax credit back and put it toward your loan.”
Making the Switch
Sigora outlined the steps needed for a homeowner to add solar energy to their home. The company first looks at a customer’s address on Google maps to see if they get enough sun.
“Not every house qualifies for being a good candidate for solar,” Leffler said. “Unfortunately, we have to tell people ‘no’ all the time. Not everybody has the opportunity based on how much sun their roof actually gets.”
About 25% of those who want to convert to solar are turned down because of their roof’s angle or the home’s position or shade trees nearby. But if the home is suitable for solar energy, the next step involves an in-home consultation to see what the cost would be versus the benefits.
“We take a look at their energy bill and build a system for them and go over the numbers to see if it’s even cost-effective,” Leffler said.
The consultation includes how much energy a family used the previous year, what they are projected to use (for example, if they want to power an electric car from their garage in the future), how long they plan to stay in the home, and how energy efficient the home may be. Sigora sends a crew to the home to assess its energy efficiency. If needed, the crew adds insulation to the attic, swaps out lightbulbs for LED’s, wraps water heaters and seals any drafts.
Cost Vs. Savings
Energy is measured in watt-hours (Wh). A kilowatt-hour (kWh), which is equal to 1,000 watt-hours, is the unit typically used by utility companies in billing. According to Enphase Energy, a solar monitoring system, it takes 1 kWh of energy to run a refrigerator for one hour, charge the average mobile phone for one day, or power a light bulb overnight.
“Every home is different,” Leffler said. “If you have an 1800-square foot ranch with two people living in it, it would cost different than a family of four living in that same house. It really depends on how much energy you use. The average cost is $30,000. That would be for around a 9-kilowatt system.”
Sho and Kate Modica added solar last year to their home in Western Ridge, where about 5% of the neighborhood’s 200 homes have solar power. The Modicas paid Altenergy about $20,000 for an 8.6 kW system.
“I’m very happy with the decision so far,” Sho Modica said. “I generate nearly all my power now from my own roof and I know it’s clean!” The monthly bills are down to the base connection fee, only about $6.00. “We’ll end up spending less than $150 for the whole year.”
The utility charges a base connection fee to cover the cost of billing, restoring energy when the power goes out, and using the utility’s infrastructure, among other things.
Midway through construction in 2015, Dawn and Damond Cromer decided to hire Sigora to add solar energy to their new home off Jarmans Gap Road.
“We decided for lots of reasons,” said Dawn Cromer, who also works for Nest Realty. “The realtor in me saw the resale value of our property would be advantageous if we had it, but it wasn’t the primary reason. It was a home that we would be in for a long time. We wanted to harness the energy of the sun.”
For the Cromers, the investment was $26,000 for a 7.56 kW system. They have a gas furnace on the main level of their house and a heat pump upstairs.
“It is a big chunk to bite off at the start, especially when you’re building and you’re on a budget,” she said, but added that it was money well spent. “We lived in our house for two months before we got the panels. We had a $346 power bill for a month and a half in the winter. And that was the winter we had two feet of snow. In March, we got another foot of snow.”
Their 24 panels went up at the end of March and the following month their power bill was $7. “It’s like Christmas every month.”
The solar company helps with getting the proper permits, setting up inspections and handling the interconnection with the utility company. “Once you get (the panels) installed, the utility company will come out and determine whether anything else needs to be done,” Leffler said. “That primarily involves a new utility meter.”
The new meter allows energy to flow in both directions. Then all that’s left is to lift the lever on the metering box and fire up the panels. “We email the customer instructions on how to turn on the system,” he said.
Electric power customers in the Crozet area are primarily served by three utility companies—Appalachian Power, Central Virginia Electric Cooperative and Dominion Energy.
Net metering is the mechanism used by utilities to bill customers who have solar energy systems. Homes or businesses that have solar panels are also equipped with meters that can send energy in two directions—from the utility’s power grid to the home and from the home back to the power grid. Customers are billed for their “net” energy use.
When a home produces more solar power than it can use, the excess energy goes back on the utility’s grid. The homeowner is credited for that energy. During the winter months or on cloudy days when the panels aren’t producing enough energy to power the home, the customer would only be billed for the electricity they use minus the excess they previously sent to the power company.
Even if you have a home with “0” net metering, meaning they didn’t need any more energy than they produced, the customer would still get a bill from the utility, mainly for costs associated with being connected.
“If you perfectly match the amount of energy you generate and the energy you use, you would get a minimum bill of $6.00,” said Katharine Bond, vice president of public policy and state affairs for Dominion Energy. “And for that $6.00, we provide billing services, wiring, and we provide you with energy when your panels aren’t producing on cloudy days or when the sun is down.”
She explained that net metering was established more than a decade ago in Virginia and several other states as a financial incentive to encourage customers to switch to renewable energy. “It was intended to spark a fledgling industry.”
But according to Bond, there are challenges with the net metering model. For one, it acts as if the power grid is a battery and that the utility can store a customer’s excess energy. For another, there’s a cap on the net metering a utility can allow.
“We can’t store energy on the grid for their use later,” Bond said, “yet they are allowed to send the energy and draw on it whenever they need it.” Dominion has filed requests with their regulator, the State Corporation Commission, to upgrade their system in Virginia, to make sure the grid can accept energy coming in and flowing out in both directions.
“We need a more modern energy grid and additional energy storage,” Bond said. “We are also investing in energy storage in terms of battery storage and hydroelectric.”
The utilities are also carefully monitoring the increase in solar energy customers to make sure they don’t go over a state-mandated net metering cap. The good news is they won’t reach the maximum for quite some time. The rate is currently set at 1% for investor-owned utilities like Dominion Energy and 5% for cooperatives such as CVEC.
Bond said this has to do with the capacity of all solar energy systems combined, rather than the number of customers. According to state policy, up to 1% of energy consumed by Dominion’s customers during peak usage in the previous year can be generated by solar.
“We aren’t even a third of the way there,” Bond said.
Richmond-based Dominion Energy is the state’s largest electric utility with 2.6 million customers in Virginia. Of the 4,200 Dominion customers with a Crozet address, 127 are enrolled in net metering
—just over 3%.
Melissa Gay, communications manager for CVEC, said the cooperative was close to reaching the cap before the General Assembly passed legislation in March that increased it to 5% of peak load. “We are nowhere near 5%,” she said.
CVEC, with headquarters in Lovingston, serves 38,000 customers in Virginia. The cooperative has 308 total net metering customers on its system and 53 of those net metering customers (17%) are in the Afton/Crozet area. Just over 3,500 residents in Albemarle County are served by CVEC.
“We are getting about 20 additions a week,” Gay said. “We can’t even think right now. They want to get the tax credit. We are very busy with the net metering.”
Appalachian Power did not return requests for statistics for this story.
Despite the surge in solar power customers in Crozet and elsewhere in the state, Virginia still lags behind many others. But things are turning around. There have been several recent developments for the state that are focusing on renewable energy, according to Jonathan J. Miles, executive director for the Center of Sustainable Energy in Harrisonburg.
“While Virginia is not as far along in installed capacity as other states in the U.S., most notably North Carolina, things have picked up considerably in the last three to four years,” said Miles, who also is a professor at James Madison University in the School of Integrated Sciences. “There’s a lot more projects. The utilities are becoming involved. There are new programs both for commercial and residential users of power.”
Gov. Ralph Northam signed an executive order in September committing Virginia to source 30% of its electricity needs from renewable energy by 2030. A proposed wind farm in Botetourt County and several other solar projects currently under construction around the state will help Virginia meet that goal.
“We’re catching up now,” Miles said. “We are seeing dramatic growth in terms of interest and deployment of solar. We are seeing not just dozens but hundreds of solar projects.