What You Should Know About An Off-Grid Solar System
10 - Minute Read
Apr 8, 2022
Some of the most beautiful properties across the United States are located in rural areas. Often, they offer peace and tranquility but are not connected to the utility grid. Establishing a primary residence or vacation home can be difficult without grid power, but an off-grid solar energy system is an alternative.
Why Go Off The Grid
Sometimes, home shoppers find a delightful property, but it is far from the utility grid. Sometimes, it can cost thousands and thousands to extend the power grid, and the homeowner needs to pay this expense. However, living in an off-grid home is appealing to some for many reasons. For one, it usually coincides with living a simpler life with greater self-sufficiency.
As utility companies hike their electricity rates, many homeowners are wondering if there is a better way. The average monthly electricity bill in the United States in 2020 was $117, but this number goes up each year. Unfortunately, electricity rates are also disproportionately high in certain areas. According to the U.S. Energy Information Administration, the average utility customers pay more than $0.20 per kilowatt-hour (kWh) of power in California, Hawaii, Alaska, Massachusetts, Connecticut, and Rhode Island. Compare that to lower average retail prices of just above $0.07 per kWh in Oklahoma, or even $0.08 per kWh in Idaho, and the discrepancy is staggering.
In addition, these households need to pay a monthly fee just to be connected to the power grid. Properties that are not connected to the grid do not pay this monthly fee. Tiny homes are also a good candidate for off-grid solar.
As far as incentives go, net metering or net energy billing policies for renewable energy systems vary widely across the United States. Some utility companies compensate homeowners with solar installations at the retail rate for power, while others offer very little compensation.
The Frustration Of Grid-Tied Solar Systems
Many solar system owners enjoy generating their own power without creating greenhouse gas emissions. Often, they can save significantly on their power bills, so the solar panels also make sense financially.
However, some grid-tied solar system owners experience a lot of grid-related issues. Net metering policies dictate how the utility companies compensate solar system owners for the surplus power they feed to the grid. Under net metering laws, the utility company compensates the customer for surplus power they feed to the grid.
Unfortunately, not all states have net metering laws, which means some solar system owners aren’t compensated as much for surplus power they feed to the grid. In some places, people with solar panels receive the retail rate for their electricity. However, in areas without strong net metering laws, they might only receive the wholesale rate or a fraction of the retail rate.
In recent years, some states have scaled back their net metering programs. This deters people from installing solar panels because they don’t know how much they will be compensated. In Hawaii, the lack of a net metering program combined with high electricity rates encourages people to install solar systems with battery storage to increase their grid independence.
Understanding Demand And Service Charges
Residential utility customers are charged in two different ways for electrical service. Power companies assess transmission and distribution fees monthly, regardless of how much power the home consumes. There is a monthly fee for having active service. The other charge is a supply charge, which varies by how much power the home uses.
Take a vacation home that isn’t in use for a month but still has active service. The owner would need to pay a monthly transmission and distribution fee for being on the power grid but there would be no supply charges on the bill if they didn’t consume any electricity.
Demand charges are another fee you may hear about, although these are usually only assessed for commercial and utility-scale customers. The demand charge is essentially a higher rate that corresponds with the highest electricity use in a given timeframe – called the peak demand period.
Some utility companies offer time-of-use rates, meaning that electricity rates fluctuate by the time of day and even time of year. These rates typically correspond with demand on the electrical grid. Thus, electricity rates are highest in the summer in the late afternoon and early evening and lowest in the middle of the night, especially in the winter.
Power Bills For Solar System Owners
Solar system owners can eliminate the supply charges on their electricity bill if the renewable energy system generates as much electricity as the home consumes throughout the year, and the utility company offers net metering. However, they probably can’t eliminate the distribution and transmission fees if the home is connected to the power grid. Therefore, most solar system owners still pay a small monthly price for grid service, even if the solar system produces sufficient power to cover their needs.
How much the utility companies compensate solar system owners varies by the laws in the area. Often, net metering allows solar homeowners to receive the retail rate for surplus power, but not always. Sometimes, they receive a percentage of the retail rate or the wholesale rate, which is considerably less.
Under net metering, renewable energy system owners rarely receive a payment for surplus power they feed to the grid. They usually receive credits for the supply charges to offset their own use. Typically, these credits expire after one year. Therefore, it isn’t usually a good idea to oversize a solar energy system because the homeowner won’t receive additional benefits for producing more than 100% of their total power.
Are Off-Grid Solar Power Systems Legal?
Typically, off-grid solar installations for homes are legal, but there are sometimes restrictions. Before making any decisions, understand the regulations, codes and requirements where you live. For example, some states, like California, require homeowners to follow specific code requirements for off-grid solar systems, which can be difficult for DIY projects.
What A Solar System Needs To Go Off The Grid
If you install an off-grid solar system, you will need certain components to keep the lights on and the refrigerator humming. Your renewable energy system will consist of solar panels, an inverter, a battery bank, and a solar charge controller.
Off-Grid Solar Panels
The PV panels on an off-grid system are just the same as the ones installed on grid-tied homes. The only difference is that you won’t have the power grid as needed. Therefore, you might want to consider adding an extra couple modules to get you through the cloudiest times of the year. If you live in a snowy climate, take actions to mitigate the panels getting covered by snow. For example, installing solar panels at a steeper angle helps snow slide off. Your installer should be familiar with your local weather, so ask them for tips on how to keep production from being hindered by nature.
Next, your home will need an inverter to convert the solar electricity from direct current (DC) to alternative current (AC) for household use. It is critical that the inverter is adequately sized to handle the number of solar panels and is compatible with the solar batteries.
Battery Charge Controller
Also known as a charge regulator, this device regulates the voltage and current of the power going from your solar panels to the batteries. The charge controller ensures that you don’t overcharge your batteries and that you don’t discharge the batteries through the solar panels at night.
For solar energy storage, your home will need a battery bank. This will also ensure that your home has power at night or on cloudy days. It is critical to have sufficient storage capacity for off-grid living unless you also have a generator to produce supplemental power.
One of the most popular solar storage batteries is the Tesla Powerwall, but there are other high-quality solar batteries for off-grid applications, including options from Enphase, KiloVault, SimpliPhi, and sonnen.
Some off-grid solar systems contain lead-acid batteries instead of advanced lithium batteries. Although they have a lower cost, they do not perform as well, may require regular maintenance, and have a shorter lifespan.
Battery capacity is especially important for off-grid solar systems without generators. If the battery bank is undersized, you might not have sufficient power on cloudy days or when the panels are covered with snow.
It might be difficult to power heavy loads, such as an electric water heater, range, or air conditioner, especially for long periods. Sometimes, off-grid living also requires timing loads properly. You might not be able to run an electric water heater and range at the same time and you might need to do laundry on sunny days or hanging it to dry.
Other Considerations For Going Off-Grid
In off-grid applications, it is critical to have a good solar resource. Ideally, you can locate your solar panels facing south with no shading. In some cases, trimming a tree or using a ground-mount can be helpful.
Also, determine if you have any energy-hogging appliances or unnecessary lights. For example, old refrigerators can drain a lot of power. If this is the case, consider replacing inefficient appliances with energy-saving models. When possible, turn off lights when not necessary to conserve power. Taking such actions will help ensure you have power after a few cloudy days for the most important power loads in your home.
Off-Grid Solar Costs Compared To Grid-Tied
Off-grid solar systems tend to be more expensive because you don’t have access to the grid. If there are a few days of cloudy weather in a row or the panels are covered with ice or snow, you can’t tap into the grid for more power.
Most grid-tied solar energy systems don't have batteries, which are a major expense. Also, many off-grid systems have a couple more solar panels to ensure there is enough power when the sun isn’t shining.
The warranty on batteries like the Tesla Powerwall 2 and the LG Chem RESU battery is 10 years. Depending on how the battery is used, it might last a bit longer. By contrast, the design life of solar panels is around 25 to 30 years. So, you will likely need to replace the battery at least once during the life of the solar system.
Because of these considerations, off-grid systems can sometimes cost upwards of $50,000, on average.
Disadvantages And Advantages Of Off-Grid Solar Systems
As with everything, there are some drawbacks to going off-grid.
- It’s possible to run out of power, especially after a few days of cloudy weather. In addition, off-grid living might involve not having certain energy-hungry appliances like air conditioners and electric space heaters to conserve energy. When the batteries are fully depleted, not even the refrigerator or the lights will work.
- Sometimes, off-grid system owners need to ration their power and wait for sunny weather to run energy-hungry devices and appliances. This requires some lifestyle adjustments and advanced planning, like checking the weather forecast.
- Your solar panels might produce more renewable energy than your battery can handle. Because you can’t send surplus power to the grid, the electricity will be wasted. Often, it is necessary to oversize the solar system for daily use to ensure the lights are on 24/7. In most climates, the winter months are the most problematic, but this does depend on the local climate.
- The design life of solar panels is between 25 and 30 years, but less for solar batteries. Unfortunately, solar system owners may need to replace the battery during the lifespan of the system. The price of advanced solar batteries is pretty steep, so it is important to budget accordingly.
- Although solar panels and batteries do not generate carbon emissions while operating, there is an environmental impact associated with mining the materials and manufacturing the renewable energy system. At the end of life, it can be difficult to recycle solar panels and lithium-ion batteries.
- To have power when the solar batteries run low, some off-grid homeowners have generators. Unfortunately, generators use fossil fuels, create air pollution, and are noisy.
Despite the drawbacks, there are many benefits to off-grid living.
- Your home will not be impacted by blackouts because you are not connected to the electrical grid. Power outages are especially common after extreme weather events including hurricanes, tornados, ice storms, etc.
- Off-grid living means you will not have to pay the monthly fee to be connected to the power grid. Depending on how much this fee is, the savings can add up.
- Emerging vehicle-to-grid (V2G) or bidirectional charging technology could provide additional resilience in the future for electric vehicle owners. This means that you could use the energy stored in your vehicle’s battery to power your home.
- You won’t be impacted by utility company rate hikes, which have been increasing across much of the United States.
- Many people enjoy living a self-sufficient lifestyle and not relying on polluting fossil fuels for power. Just like it can be fulfilling to grow some of your own food, having an off-grid solar system offers a similar benefit.
- Some remote properties are not located near power lines, and they can be extremely expensive to extend service to. Living in an off-grid house enables you to have more property options without considering the expense of extending the utility grid.
Staying On-Grid, But With More Resilience
If your home is connected to the power grid, it probably makes sense to keep it that way. Remember, you can have a grid-tied solar system with batteries.
- If you have a solar system with a battery, your home can still have power during a blackout.
- A battery can also power your home in times of high electricity demand. In areas with time-of-use rates, the battery can result in greater savings because you can draw power from the grid when rates are low and provide power when rates are high.
- You will not waste any power if you are connected to the grid. If your battery bank is fully charged, surplus power goes to the grid.
- Your solar system can be sized for daily use, not for the worst-case scenario. This means that you will need fewer solar panels and less battery capacity because you can tap power from the grid when needed. And that means a lower overall cost for your system.
The Bottom Line
Although off-grid living has some advantages, it isn’t for everyone. Often, off-grid solar system owners need to conserve energy in cloudy weather to keep the lights on. Although some people may really enjoy living on remote properties far from modern infrastructure, others may not.
One of the best ways to determine if off-grid living is for you is to try it out. See if there are any vacation rentals with off-grid solar systems.
If you’re thinking about an off-grid solar system, you’ll need to keep your system running at top efficiency. Check out our article about solar system cleaning so you’re prepared for this important task.