When Home Energy is cheaper than Grid Energy

It’s no question inflation is galloping higher, eroding the purchasing power of labor, money, and wealth. Housing prices, autos, gasoline, food, all higher from a year ago. One thing that shocked me to see was the pace of electricity rates and natural gas rates from a year ago. It’s when I realized that our new solar panels (home energy) will be cheaper than getting energy from the grid.

That’s a game changer for the world, similar to what Australia learned a few years ago. Australia learned that renewable energy was cheaper than grid energy, and massively switched to renewable energy. Their electricity bills have gone down and grid reliability has increased. I don’t expect grid rates for electricity or unnatural gas to stop increasing any time soon for the world. This is good for climate economics for homeowners to switch to cheaper, cleaner renewable energy that does not produce CO2.

Price of electricity and piped gas, YoY and QoQ in the US. Source: bls.gov

Above we see the rate changes for electricity and unnatural gas across the US. In the South, average electricity prices have increased by 10.6% year over year. Unnatural gas gone up 22.1% year over year. Our electricity prices have gone up 25% and unnatural gas prices are up 62% over the past year, far above average. All hail the broken Texas power grid!

I calculated the cost of our solar panels this way. SunPower expects to produce 264,337 kWh of electricity over the lifetime of our solar panels. The cost was $24,287. Taking the dollars and dividing by the total production, we get a cost of 9.2 cents per kWh. This is far cheaper than the 14.5 cents per kWh we are paying our utility cooperative. Plus, our cost is locked in for the next 25 years. Without a doubt, local utility prices will continue to go up.

The cheaper solar panel electricity cost will motivate those on the fence to switch. It’s simple economics. Those that own panels may want to consider getting more panels. During the summer, the sun will power the AC. During the winter, the sun will power our room electric heaters, allowing us to reduce central heating powered by expensive unnatural gas. Modern houses are efficient. More can be done to reduce energy waste and increase efficiency, from better design of pipes and ducts, and better insulation of houses. We’ll discuss that in another piece.

As a major side benefit, decentralized, locally produced energy will make any country self-sufficient in energy, enhancing the natural security from autocratic dictators wielding energy as a weapon for war.

We are waiting on our utility to install our bi-directional meter for the last month. With economics like these, it is in their benefit to postpone the transition to renewable energy as long as possible. Get started today. Our panels have taken 5 months and we are at the last step.

Look at the estimated savings in C02, lbs of coal not burned, and gallons of water saved, each year, due to our solar panels.

With peace, love, and hope,


Published by smilingdad

My story is one of tragedy and redemption. We've made many mistakes along the way regarding our money. Our goal here is to show you how to take care of your money life long, and as much as we can, help the Earth along the way. I call it sustainable personal finance and ethical capitalism. Currently, I am a part time writer for Cleantechnica and part-time licensed financial professional, along with being a full-time dad.

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