Considerations and Variable in Sizing Your Home PV System – What You Need to Know

In this “What You Need to Know” article, we will detail the myriad benefits of home solar and provide you with a comprehensive list of variables you need to consider when sizing your system. We acknowledge in this opening segment that this article is somewhat self-serving in two ways:

  1. As you’ll see below, sizing, designing, and installing a home solar system is not a DIY project; you’ll need the guidance and expertise of experienced professionals in the solar industry.
  2. There has never been a better time to go solar – as installations become significantly more affordable, Federal Tax Credits continue to decline, and utilities prepare to revise rate plans.
  • The cost of a solar installation has declined by more than 70% in the less decade.
  • Federal tax credits for residential solar will go from 26% in 2020 to 22% in 2021.
  • Utilities, such as APS (Arizona Public Service), prepare to revise solar rate plans.

The Benefits of a Home PV System

The decision to “go solar” represents a wise investment and provides significant benefits to the homeowner:

  • Economic benefits – reducing or eliminating energy expenditures, protection against future rising energy costs, and getting a continuing return on investment
  • Environmental benefits – reducing your carbon footprint, protecting the environment, consuming sustainable energy, and reducing dependence on foreign energy
  • Benefits to the local economy – installing today you’ll be supporting local businesses that design and install your system
  • Residual benefit – solar will increase your property’s resale value (only when you own – do not rent, lease, or PPA your solar)

Some Basic Considerations in Sizing Your PV System

We will “ease into” the variables for consideration when sizing and designing your home solar system. 

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Determine Your Goals for Going Solar

To properly frame the project let’s start with determining your goals and objectives:

  1. For most, financial considerations are primary. Of course, you want to reduce utility charges. Do you want to size your system to eliminate all electricity costs? Do you want to sell excess production back to your utility? 
  2. Environmental concerns fuel many homeowner’s desire to go solar, reducing your carbon footprint and emissions. 
  3. An option is to lease your solar energy versus producing your own. If selling your home at a future date is a consideration, we recommend purchasing your system. 

 An essential first step in quantifying your energy needs is to compile at least one year of electrical bills. You will need to set up a basic spreadsheet that captures your monthly energy usage in kWh (kilowatt-hours), the monthly cost, and, if applicable, demand data.  Some utilities will be willing to help you gather this information.

Your spreadsheet will help you identify the required number of kWh of electricity you will need per year, which allows you to determine system size. Size refers to capacity and is measured in kilowatts DC or (kWDC).

Note: There are residential PV array system size limits determined by your existing service. An experienced solar professional can guide you through these limitations, recommend the appropriate inverter size, and advise if a solar-ready main service panel upgrade is required:

  • For 200 Amp service, a maximum of 15 kW-dc.
  • For 400 Amp service, a maximum of 30 kW-dc.
  • For 600 Amp service, a maximum of 45 kW-dc.
  • For 800 Amp service and above, a maximum of 60 kW-dc

Typical Phoenix Home and Solar – Some General Guidelines

Most residences use between 6,000 and 20,000-kilowatt hours of electricity per year. Although usage varies based on size, age, and quality of insulation, a typical Phoenix home uses about 9,250 kWh per year.  Most homes have 200-amp service and thus can only connect inverters up to 7.7 kW without expensive panel upgrades. This size inverter will handle PV arrays of up to 11 kW. 

And the good news, an unobstructed South-facing 11 kW array will produce about 17,600 kWh/year. What to do with that excess energy, 17,600 kWh produced versus 9,250 expended? We’ll address that in great detail in the financial considerations.

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Initial Considerations for Home Solar

When addressing the physical variables, a primary consideration is the available roof area for PV panels. This will help determine the potential array size. Other physical issues might be the roof’s orientation, slope, and shading from trees, air conditioners, or other parts of the roof. Building codes may require setbacks from roof ridges. In Arizona, a Southern facing array provides the best results, followed by East or West, a moderate decline in performance, but we recommend you not consider a North-facing array.

Depending on the available roof area and orientation, you may need to consider higher efficiency PV panels. Panels continue to evolve, and today’s new hetero-junction technology will achieve higher efficiencies at a lower cost of production.

And, speaking of your solar equipment, the panels are just the beginning. You will need to research and discuss other components with a reputable, experienced installer such as:

  • Framing, the structure to mount the PV modules
  • Inverter(s)
  • Disconnect switches to meet rapid shutdown requirements, and meters
  • Wiring and other electronic parts

Other items to consider before the actual installation include design, drawings, and permits – all of which should be handled by a professional installer.

We recommend you discuss your proposed system with your utility.  Both SRP (Salt River Project) and APS offer excellent advice and can advise on the best rate tariff for your situation.

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Financial Considerations for Home Solar

One of the most crucial determinations you will confront is the economics that vary by utility and rate schedules. In this segment, we detail how utilities have different rates and requirements.  Your primary considerations are:

  • Utility purchase rates for any excess production – remember that 17,600 kWh produced versus 9,250 consumed?  
  • Fixed charges (based on PV rating or inverter rating)
  • Demand charges
  • Time of day rates

APS Excess Power Credits and Rate Schedules

APS policies are the most “pro-solar” in the state – that is, compared to SRP or TEP (Tucson Electric and Power). APS uses meters that measure the export power (excess power produced) and credits this monthly at $0.1161 per kWh.

APS On-Peak Energy Charges in the Summer range from $0.24314 (Saver Choice) to $0.05750 (Saver Choice Tech), depending on the rate schedule and the corresponding demand charge. Click here to view APS Residential Service Plans on their site.

APS has a variety of plans to choose from based on how you use energy. Review their policies and options to find the one that works best for your situation. When you use energy can be as important as how much electricity you use, so pay attention to the time-of-use plans, particularly for off-peak hours and holidays.

Determining the right plan; Saver Choice, Saver Choice Plus, Saver Choice Max, or Saver Choice Tech is confusing. Adding to the complexity, APS charges solar customers a Grid Access fee of $.093 per kWdc of the system rating.

SRP (Salt River Project) Rates and Solar Credits

SRP handles solar customers a bit differently.  Residential solar customers are required to use the E-27 Customer Generation Price Plan rate schedule with high demand rates and low energy rates.  There are two strategies save to money on this plan:

  1. Shift energy use from on-peak to off-peak hours. On-peak hours are weekdays from 5-9 a.m. and 5-9 p.m. November through April – and weekdays from 2-8 p.m. May through October. All other times, including weekends and holidays, are off-peak.
  2. Manage energy use in your home, so major appliances that demand large amounts of electricity do not run at the same time during on-peak hours.

Excess energy produced by your system is credited at $0.037 to $0.0633 per kWh, considerably lower than APS; however, SRP does not have a monthly fee based on PV array or inverter size.

TEP (Tucson Electric and Power) Solar Credits and Rate Plans

New solar customers can choose from two existing TEP time-of-Use pricing plans. Both plans offer lower rates during most of the day, on weekends, and on holidays.

TEP pays new solar customers $.0964 cents per kilowatt-hour (kWh) for their systems’ excess power. Customers maintain this initial export rate for up to 10 years with the caveat that export rates will be updated annually to reflect market prices for solar energy. Rates are not allowed to fall more than 10 percent.

For Texas and Oklahoma there are too many utility companies to list.  Texas has over 32 utility companies so we had to pick a region so you can compare.  What we can say is that all co-ops make sense and other areas you may need a solar battery and not sell the power – it all depends.

There Has Never Been A Better Time to Go Solar

Even in these unsettled times, there has never been a better time to go solar before federal and state incentives decline, and utilities revise their solar policies. Switching to clean, renewable solar today relieves dependence on foreign oil and fossil fuels.

If, as we predicted in our opening, you find you need help negotiating the details of sizing your solar system, we are here to help. We have been installing solar in Arizona longer than anyone.

PEP Solar Since 1981

At PEP Solar, we partner only with the best in class solar manufacturers to deliver your best solar solution. Let us design and supply your system using the best products in the solar energy market.

We hope this article has been helpful and informative in your consideration of solar energy. We are a full-service solar company and have been installing, servicing, inspecting, and repairing solar for homeowners and businesses in Arizona since 1981. Our mission is to provide complete solar power solutions that perform beyond your expectations for the life of your system. 

We can help you become a “prosumer,” a homeowner that both produces and consumes solar energy.

For more expert information on all things solar, visit us online at pepsolar.com or contact us at: (623)806-8806.

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