So everyone is asking “how do I go solar”…at home and at work. Up until now, solar power has, for the most part, been a pretty big investment. This is where Power Purchase Agreements, or PPA’s come in to play, specifically for commercial users. For those of you who don’t know what a PPA is here is the Wiki. Solar Power Partners, based out of Mill Valley, CA, is one of the largest players in the market.
So I’ve done some quick math… Colorado commercial users are charged a rate of $0.085/kWh. Let’s assume post tax credits and rebates, your charged rate will be $0.145/kWh. Typical with most PPA agreements, there are annual escaltors…the average is about 4.5% per annum. The average annual electricty rate increase over the past 10 years in Colorado has been about 9.0%. When the global economy does come back…and the big question is “when”, energy rates will continue to climb exponentially across the world as global consumption of energy and demand will continue its upward ascent as China and India continue on their paths towards First World status. I’m thinking annual elecricity rate increases will average 10%-15%.
Breakeven happens at year 12…all in after 20 years….you will pay $0.001/kWh by entering into a PPA….negligible!
Filed under: Solar Power
