Sun Bug Solar Panel Proposal for 380 Esse Salem 8.16.2016
August 16, 2016
Jay Famico
380 Essex St
Salem, MA 01970
Jay ,
It was a pleasure meeting with you to discuss your solar potential. I admire your commitment to
having a more energy efficient home. Here is the formal proposal for your new solar PV system.
Notes:
• Based on the utility bills you supplied, in the last 12 months you consumed 6,811 kWh We have
modeled your electrical payback starting at $0.170 per kWh. We have modeled your SREC
incentive at .8 or 80% its current value. If the final DOER announcement, on or around August
31st, 2016 for SREC 2 values does not meet your expectations, we can cancel the deposit and
refund the remainder of your deposit not used for structural engineering purposes.. Your utility
provider is National Grid.
• You have considered having SunBug install a critter guard protecting the perimeter of the array
but have determined it is unnecessary at this time.
• The turnkey price of this system assumes that the panels can be walked up through the attic.
After deposit a crewmember will test this out. If it is not possible we will need to reevaluate the
cost of a lift rental and adjust the price accordingly. If an agreement cannot be met you may
back out of the project.
• SunBug Solar recommends that you replace your roof prior to a solar PV installation. SunBug
Solar will not complete a solar installation unless the roofs where the solar array will be located
have been replaced.
.
• The solar modules utilized in your PV system are black-framed SunPower High-Efficiency panels,
the highest quality, highest-efficiency, best warrantied solar modules in the world.
• Your Solar Edge inverter system has a 25 year warranty: in addition to the 25 year Power
Optimizer warranty, included in this price SunBug is extending the inverter warranty to a full 25
years for your system.
7.20 kW Photovoltaic system:
20 SunPower 360 watt X22 Ultra Efficiency modules, 1 SolarEdge se6000 inverter &
optimizer system, and all necessary balance of system materials (racking, wiring,
disconnects, etc.). This price is for complete, turnkey service including all permits and
paperwork.
The gross price of this system installed is $39,944
Less 30% federal tax credit* - $11,983
Less 15% state tax credit* (capped at $1,000) - $1,000
Total anticipated cost after incentives $26,961
Projected 30 year electricity savings $59,930
Projected 10 year SREC revenue (DOER MIN / MAX) $12,361 / $16,712
Projected Payback 8-9 Years
Solar Savings & Your Electric Bill
The 7.20kW system will produce on average approximately 7,700 kWh/year. Based on
your consumption, this system will allow you to produce approximately 113% of
your electricity yourself.
Additionally, after factoring in SREC revenue (see SREC description in this proposal),
your new PV system could eliminate your home’s entire electricity cost. In f act, in its first
year, solar savings plus SREC revenue at the minimum level of $285/SREC will cover
an anticipated 282%.
Environmental Savings
Over its 30 year anticipated life-cycle, it will generate more than 224,000 kWh of energy
from the sun. In that time it will save 154 metric tons of CO2 from entering the
atmosphere, equivalent to:
• the greenhouse gas emissions from taking 32 cars off the road for 1
year,
• or the carbon sequestered annually by 126 acres of pine or fir
forests.
Inverter System and Monitoring
Your Solar Edge inverter system includes individual Power Optimizers, allowing for both panel-
level and array-wide monitoring. Performance of each module is measured and communicated
in order to maximize solar power harvesting at all times. Your Solar Edge Power Optimizers
have a 25 year warranty. Additionally, included in this price SunBug is extending your Solar
Edge inverter warranty to 25 years.
Note that to take advantage of this monitoring system you must have internet service at your home.
7%
44%34%
15%
Current power profile
Coal & Oil
Natural Gas
Nuclear
Hydro & Other 100%
Power profile with solar
Solar
Coal & Oil
Natural Gas
Nuclear
Hydro & Other
Photovoltaic Incentives and Return on Investment:
On-going Revenue: Solar Renewable Energy Credits
Massachusetts is one of a handful of states that runs a Solar Renewab le Energy Credit
(SREC) market for solar system owners. This program offers a ten year production
incentive for making solar energy, above and beyond electricity savings.
SRECs behave like stock certificates. They are bought and sold on a market
administered by the Massachusetts Department of Energy Resources . An SREC does
not represent electricity itself - solar system owners make their own electricity and
experience the associated utility savings independent of the SREC program. SRECs are
an additional financial incentive for Photovoltaic electricity producers on top of utility
bill savings.
SRECs are purchased by the investor-owned utilities, such as National Grid and
Eversource. In Massachusetts, electric utilities need SRECs to meet solar productio n
mandates established by the state’s Solar Carve-Out program within the Renewable
Portfolio Standards.
Since its creation in 2010, the SREC program has had robust participation. When the
state reached the 400 MW capacity target of the first version, SREC I, the DOER
created SREC II and a new a 1600 MW target. That success has in turn lead the DOER
to begin to design SREC III or another incentive structure to replace SREC II in the
future.
An SREC is worth whatever a utility will pay for it: SRECs are bought and sold in a
market. However, there are price support mechanisms put in place by the DOER in an
effort to create “ceiling” and “floor” values for SRECs.
The ceiling is determined by the fine levied on utilities for not meeting the solar standard.
This is called the Alternative Compliance Payment (ACP) and is published by the DOER
as $350 per SREC II in 2017, declining annually for the next 10 years to $244 in 2025.
The floor is established by the DOER’s Solar Credit Clearinghouse, an auction of last
resort should an SREC not sell. This Solar Credit Clearinghouse values an SREC II at
$271 each in 2017 declining annually to $180 in 2025.
Your system's SREC performance:
# SREC's* Min, SREC II Rate ** Max SREC II Rate**
1st Year 6 $1,512 $2,000
10 Year Total 61 $12,361 $16,712
** Rates are based DOER's 10 year SREC pricing guidelines, all less trading fees
Photovoltaic Direct Return on Investment
SunBug's return on investment calculations are generally conservative compared to industry standard. We are
happy to walk you through our assumptions and show you our complete calculations in detail. **
Assuming minimum SREC value, payback occurs in 9 with an anticipated:
• 20 years of free electricity,
• lifecycle savings of over $45,000,
• and Internal Rate of Return of over 11.5%.
Assuming maximum SREC value, payback occurs in 8 with an anticipated:
• 21 years of free electricity,
• lifecycle savings of over $49,000,
• and Internal Rate of Return of over 12.9%.
Indirect Return on Investment: Home Value
These direct ROI models do not incorporate the increased home value associated with solar,
because New England-specific data is not yet at a statistically relevant size. But an Appraisal
Institute study estimates that property value increases by $20 for every utility-bill dollar saved due
to energy improvements. Also, the U.S. Department of Energy found that even in soft markets, a
home with solar will sell in half the time as one without.
$0
$500
$1,000
$1,500
$2,000
$2,500
$3,000
$3,500
1 3 5 7 9 11 13 15 17 19 21 23 25 27 29
Annual Savings Before & After Payback
assuming projected minimum SREC II value
Inverter Replace
After Payback
Before Payback
$0
$500
$1,000
$1,500
$2,000
$2,500
$3,000
$3,500
$4,000
1 3 5 7 9 11 13 15 17 19 21 23 25 27 29
Annual Savings Before & After Payback
assuming projected maximum SREC II value
Inverter
ReplaceAfter Payback
Before
Payback
Return on Investment Detail
Electricity produced by solar array Minimum SREC II rate Maximum SREC II rate
Year
Value
per Solar
kWh
Solar
production in
KWH
Solar
production in
$
SREC II
revenue
Cumulative
cash flow SREC II
revenue
Cumulative
cash flow
0 $0.00 0 $0 $0 ($26,961) $0 ($26,961)
1 $0.17 7,724 $1,313 $1,557 ($24,090) $2,011 ($23,636)
2 $0.18 7,705 $1,349 $1,473 ($21,268) $2,006 ($20,281)
3 $0.18 7,686 $1,386 $1,395 ($18,487) $1,904 ($16,991)
4 $0.19 7,666 $1,424 $1,323 ($15,739) $1,802 ($13,764)
5 $0.19 7,647 $1,463 $1,257 ($13,019) $1,707 ($10,594)
6 $0.20 7,628 $1,503 $1,192 ($10,323) $1,617 ($7,473)
7 $0.20 7,609 $1,545 $1,127 ($7,652) $1,534 ($4,394)
8 $0.21 7,590 $1,587 $1,067 ($4,998) $1,451 ($1,356)
9 $0.22 7,571 $1,630 $1,008 ($2,359) $1,374 $1,649
10 $0.22 7,552 $1,675 $961 $277 $1,304 $4,627
11 $0.23 7,533 $1,721 $0 $1,998 $0 $6,348
12 $0.24 7,514 $1,768 $0 $3,766 $0 $8,117
13 $0.24 7,496 $1,817 $0 $5,583 $0 $9,934
14 $0.25 7,477 $1,867 $0 $7,449 $0 $11,800
* 15 $0.26 7,458 $1,918 $0 $9,367 $0 $13,718
16 $0.26 7,440 $1,970 $0 $11,338 $0 $15,688
17 $0.27 7,421 $2,024 $0 $13,362 $0 $17,713
18 $0.28 7,402 $2,080 $0 $15,442 $0 $19,793
19 $0.29 7,384 $2,137 $0 $17,579 $0 $21,930
20 $0.30 7,365 $2,196 $0 $19,775 $0 $24,125
21 $0.31 7,347 $2,256 $0 $22,030 $0 $26,381
22 $0.32 7,329 $2,318 $0 $24,348 $0 $28,699
23 $0.33 7,310 $2,381 $0 $26,729 $0 $31,080
24 $0.34 7,292 $2,447 $0 $29,176 $0 $33,527
25 $0.35 7,274 $2,514 $0 $31,690 $0 $36,040
26 $0.36 7,256 $2,583 $0 $34,272 $0 $38,623
27 $0.37 7,238 $2,653 $0 $36,926 $0 $41,276
28 $0.38 7,219 $2,726 $0 $39,652 $0 $44,003
29 $0.39 7,201 $2,801 $0 $42,453 $0 $46,804
30 $0.40 7,183 $2,878 $0 $45,331 $0 $49,681
Lifecycle Savings $45,331 $49,681
Lifecycle Internal Rate of Return (IRR) 11.5% 12.9%
Payback in Year 9 8
Assumptions: post incentive install cost $26,961, inverter replacement in year 15, current price of electricity
$0.17/kwh, annual electricity increase 3%, customer tax rate #REF!, SREC revenue projections per DOER
published rate schedule over 40 quarters (10 years), here: http://www.mass.gov/eea/energy-utilities-clean-
tech/renewable-energy/solar/rps-solar-carve-out-2/current-statis-solar-carve-out-ii.html.
Installation
20 panels will be installed on the roof, as approximately indicated below:
Your system uses SunPower 360 watt X22 Ultra Efficiency panels, similar to the panels seen in
this SunBug installation:
Your SunPower panels are backed by the industry’s leading 25 year “bumper-to-bumper” panel
warranty. SunPower goes beyond any other manufacturer to cover the diagnostic and labor costs
associated with replacing any panel for 25 years. In addition, h igher year one performance plus a n
industry leading degradation warranty means that compared to standard efficiency panels,
SunPower panels produce 21% more energy over 25 years.
Installation Schedule
The actual installation of your PV system should take 2 to 3 days. However, coordinating with the
electric utility, building department, electrical permitting, etc. takes time, so we would schedule your
solar PV installation for 4 to 5 months from receipt of signed proposal, in conjunction with weather
conditions.
Terms and conditions
Upon acceptance of this proposal, installation will be governed by the SunBug Turn -Key Installation
Agreement. Standard payment terms require $1000 due with signed proposal, 50% of gross price
balance on order of materials, 40% of gross price balance upon completion of installation, and final
10% paid on utility interconnection.
This proposal is valid 14 days from date of issue.
If this proposal meets with your acceptance, please sign below. If you have questions, call me at
617-500-7015 to talk it through.
Thank you,
Chris Miller
ACCEPTED:
____________________________________ _________________
Jay Famico Date
* The availability of Federal and State tax credits is dependent on individual taxpayer information and not guaranteed by
SunBug Solar. The availability and amount of any rebates are subject to change and not guaranteed by the paying party or
SunBug Solar.
** Investment calculations, including projected SREC revenues, are based on industry standards, including system
specifications and output projection based on 30-year average weather data for the region. SunBug Solar makes no
guarantees for system costs or savings based on this proposal, and advises customers to consult their own investment
professional to calculate return on investment for any home or business improvement project.
8/16/2016 • 7.20 • SunPower 360 watt X22 Ultra Efficiency • $39,944