As mentioned previously, we aren’t going to be able to afford solar panels for our house, initially. We are planning space and wiring for them, and are confident solar technology will become quite affordable within a decade. Unfortunately, even our smallish appetite for 350kWh/mo. can only currently be sated by a $25,000 photovotaic array (factoring in the amount of sun we’d receive in Toronto).

But considering 350kWh/mo. only costs $49.22¹ from Toronto Hydro, I decided to run the numbers on the approximate cost of ownership for solar panels and was very surprised at the result. The disruptive force in the calculations was Bullfrog Power.

Even though I’ve skewed the numbers in support of buying solar panels, that option is still 60% more expensive, for no real benefit to the environment (considering one can buy clean power from Bullfrog).

When I first thought about writing this entry, it was supposed to be about the revolution of distributed power generation that will come with low-cost, high-efficiency solar panels. But now that I’ve run the numbers I don’t see that happening.

A relatively small power generation company like Bullfrog can already sell green power at very reasonable prices. Given the overhead involved in managing one’s own power generation, Bullfrog are in a much better position to take advantage of changes in technology than individual consumers are. When prices drop for individuals, they’ll drop even more for Bullfrog, and other power generation companies.

In fact, companies are just the sorts of long-lived entities that thrive on long term capital investments such as solar panels… when there is actually any profit in it. The fact that no power-generation company is generating with solar (at least not around here) leads me to believe that buying solar panels for home power generation is terrible investment (financially and environmentally). For those living anywhere near an urbanized area, it seems likely there will always be a company able to generate green power with the latest technology far more efficiently than any individual could.

Using solar water heaters in the home still seems like a good idea. (Water can’t be heated ‘cleanly’ by someone else and then piped into your house.) But this also raises a question: If heating our home or water via non-solar means, is it better to do it with less efficient but green electricity, or more efficient but dirtier natural gas? I will have to do a few more of these types of studies on the cost of solar water heaters for tap-water and radiant floor heating vs. electrical heaters.

At the moment, I’m thinking the answer might just be Bullfrog.

FOLLOW-UPS TO THIS POST ARE NOW AVAILABLE (Follow-up 1, Follow-up 2).

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