Green Collar Blog

Don't take my word for it, take the word of Exxon-Mobile, the world's largest publicly-traded oil company.  In an article in the Wall Street Journal yesterday titled Exxon Struggles to Find New Oi l, states:

 

In its closely watched annual financial report released Tuesday, the company said that for every 100 barrels it has pumped out of the earth over the past decade, it has replaced only 95.

 

It's a conundrum shared by most of the other large Western oil-producing companies, which are finding most accessible oil fields were tapped long ago, while promising new regions are proving technologically and politically challenging. 

 
Peak Oil has come and gone, and still our vaunted congress is doing everything they can to keep their head in the sand and let the oil companies write our energy policy.  

In a related story, Japan just announced a plan to build the fastest high 

speed train in the world (310 mph).  Imagine a 310 mph train connecting Boston and Chicago.  You would be there in 3 hours - less time than getting to Logan, parking, getting frisked in security, waiting around for an hour, waiting for the weather to clear, the plane to be de-iced, waiting in line on the tarmac, waiting for our baggage, and renting a car - and ou would walk upstair in a train station in downtown Chicago, not 25 miles out in the suburbs.  According to Smart Planet :

The new line, which [will run between Tokyo and Nagoya] is estimated to cost about $64 billion, will extend for about 178 miles. The company expects trains running on it to reach speeds up to 310 miles per hour. The line will cut travel time between the two cities by 40 minutes. 

Meanwhile in America, we apparently want no part of this green wave of the future.

 On the flip side, Florida governor Rick Scott announced today that his state would be rejecting $2 billion in federal funds to build a proposed high-speed rail line linking Tampa to Orlando. Scott, a Republican elected in last November’s election, will be the third Republican governor to return funds allocated for high-speed rail.

John Kasich of Ohio and Scott Walker of Wisconsin have also rejected high-speed rail funds, citing cost overruns.

 

 What is going on here?  Asia is cleaning our clock on the infrastructure and industries of the 21st .  Make no mistake, we are going to be installing high speed rail in this country...the difference is that we are going to be importing it all from overseas...same for wind turbines and solar solutions.  We'll probably even import the jobs to install all of our green infrastructure because Americans won't know how.

In this interview with Dr. Neno Duplan, the CEO and founder of Locus Technologies , we discuss the current thinking and approach to water in today's business landscape.  Locus, is a leading company in the environmental software space and they have been helping organizations track their water usage and quality and ensure regulatory compliance related to water for over a decade.

This led to a discussion about the current shockingly low cost of water (less than 1 cent per gallon, even in water scarce regions) and how it leads us to disregard this vital resource and consider it free.  Dr. Duplan does not see any price increases on the horizon, but obviously a price on carbon would cause businesses to start looking hard at water and curtail overuse and contamination.

The real business opportunity exists the further companies move down this process.  When it comes to water, organizations that are finding ROI are moving from simply collecting and reporting data needed for compliance, to using that vast amount of data to identify business processes that can be improved.  This leads to lower costs, improved efficiencies and increased profits. 

Listen to the whole interview

If you are interested in pursuing a green career or looking for a company that espouses green practices, you've hit on a growing demand cycle. To properly leverage all the new opportunities out there, you not only need to have the required skills, but the right attitude and "brand". Employers are looking for professionals who not only bring high energy, but a real devotion to green philosophies. This shouldn't come as a surprise as companies who pursue a green business model are concerned not just about the bottom line, but how their activities contribute to a better future.

How To Build A Personal Brand

In essence, your job seeking "brand" is a reflection of who you are and should be focused on what an employer will value.

1. Keep your message consistent. It is no longer possible to separate your business persona from your personal life. Employers are hyper-sensitive to any appearance of subterfuge or dishonesty. This means your message includes not just your education and work history, but what you do with your free time. Are you active in charities or causes that support the environment? Do you pay attention to your own carbon footprint?

   Walking the walk is reflected in many simple ways, from your power settings on your computer to being connected with what's happening in your community. You should be conversant in any initiatives in your area and the green movement in general. Industry specific advances are an expected part of what you bring to the table. You can take a Green Quiz here to get in the mood, and read about green living all over the Internet. Remember, this isn't an adversarial relationship; employers are looking for you precisely because you bring the right conservation attitude to the mix.

2. Your online image.This is a perilous trap you can avoid simply by investigating yourself as if you were a potential employer (or ask a computer savvy friend to do it). You may, in your heart of hearts, be the most concerned and caring person on the planet, but if your Facebook page has pictures of your unmuffled Harley and a recipe for your famous "knock you on your butt" cocktail - this can be discovered and will end up working against you; even if it never gets mentioned.

   What forums do you post on? What does your LinkedIn page say? Let your online persona reflect your best and brightest self. What you post in blogs and elsewhere will be counted as part of your brand, if only because employers think this is a clearer reflection of your true self. You can improve your brand by adding industry specific links and articles that have an eco-centric bent. Just tap into what you are already interested in and share it with others in a natural way online.

3. Understand the realities.This is the obverse of the above. Sometimes, in our anxiety to impress, we come off as too critical of the current state of affairs. Understanding the realities of a business you are applying to means a willingness to start from wherever a company or community happens to be.

   You may be asked to make an off-the-cuff assessment, but criticisms have to be combined with suggested solutions or ideas. Without this pairing, it is better to be graceful about what you feel are poor practices. A businessman will understand there are improvements to be made, but if you are over-critical, it is just insulting. Hiring is hugely biased by personality. Don't be so aggressive in your drive toward eco-friendly that you become an irritant.

4. Understand your future employer's concerns. It should be a part of your investigation of any company - what are their policies and vision on the ecological front? How will current trends feed into this? Are they hoping for a push toward solar? Do they envision a combination of wind farms and free-range as the best use of available land?

   Companies that will interest you will be upfront on their website and promotional materials about initiatives they have in the works. You should be familiar ongoing projects and be familiar with the challenges as they relate to your own area of expertise.

5. Don't overplay your hand. There are two realities at play here. The first is whether you have the background and skills for the job. The second is your "brand" when it comes to dedication and your own sense of "best practices." However, if you overplay your hand and attempt to be Mother Earth's Own Prophet, you risk coming off as, well - a bit nutty. Passion is one thing, extremism is another. The green revolution came, not from the rabble, but from honest people who addressed real problems in a mature manner - that's the proper tone.

   Don't rely on your environmental IQ overcoming a lack of necessary education or work history. Think of your brand as augmenting your demonstrated skills, not a way to oversell yourself.

Final Tip

Examine your resume with an eye toward your brand. If I had never met you, could I tell from your resume that you are involved with environmental trends?

One tactic is to leave some of the things that give you your best credibility less than fully developed. Mention them, but don't put in details - give some natural openings for questions at an interview. This works wonderfully when you've had previous employment in the sector or are active in environmental causes. One line in a resume can lead to a ten minute chat about something you know well and care about.

Brendan Cruickshank (Vice President of Client Services) - Brendan is a veteran of the online job search and recruiting industry, having spent the past 8 years in senior client services roles with major sites like Juju.com and JobsInTheMoney.com. These sites cover employment searches on everything from jobs to North Carolina Jobs.

Part 4 in a series of 4 posts from Dr. Nicole Peill-Moelter, the Director of Environmental Sustainability at Akamai, in which she documents what she learned while deploying a solar system on her home in California.  

Calculating Your Effective PV KWH Rate to Estimate Your ROI

To estimate the ROI of your PV system you'll need to calculate your current KWH rate from your utility and the effective KWH rate of your PV system.  The latter calculation will vary depending on the financing option you choose.  Let's look at an outright purchase first and then a leasing option.

PV System Purchase KWH Rate

In this case you need to estimate the total KWH the system will produce over its lifetime accounting for the annual reduction in the system performance, 1% per year.  Conservatively the system lifetime is 20 years, the typical warrantee period, but more likely longer, e.g., 25-30 years.  Next calculate your cost.  This should include any interest rate cost if you finance the system and also any state rebates and federal tax credits.  It should also include $1-2,000 for the replacement of the inverter about halfway through the system's lifespan. Inverters are generally waranteed for 10 years.  Then divide the total cost by the total system output to arrive at your effective PV KWH rate.

PV System Leased KWH Rate

The calculation is similar to the purchased calculation.  The PV system vendor will guarantee an annual KWH output for your system which you then total up for the term of the lease, e.g., 15 years.  You then need to calculate the net present value (NPV) of your lease payments including any down payment and financing charges.  Doing a NPV calculation takes into account that a $100 payment 10 years in the future is worth less than $100 payment now - depreciated each year by the discount rate.  This is your total system cost.  Again, divide the total cost by the total system output (KWH) to arrive at your effective PV KWH rate for your leased PV system.

PV System ROI

Now, the number you've been waiting for [drum roll] the ROI of your PV system.  The easiest way to do this calculation is to multiply your PV system's total lifetime output in KWH by your current utility KWH rate.  The ROI is the difference between this value and the PV system's cost.  Technically, to be accurate you should do a net present value calculation of your utility payments over the system's lifetime.  However we can make a simplifying assumption that the discount rate used in the NPV calculation and the rate at which electricity prices will increase are about the same.

We leased a system for 15 years with an estimated payback of 7-8 years.  We leased because once the kids are out of college we plan to downsize to ensure they don't come back to live with us!

Food for Thought

Two additional things to consider when mulling over whether a PV system makes sense for you is the future cost of grid electricity and water usage associated with the traditional production of electricity.

With the installation of smart meters it's very possible that utilities will start to price electricity based on time-of-day.  This is because electricity is most expensive to produce during periods of peak usage which just so happens to be during the day and early evening when you are likely to be using the most electricity, e.g., 1-8pm.  If that's the case, your future electricity rates could be substantially higher than the current flat rates you are paying today.  A PV system locks in your rate for 15-30 years.  The only risk you run is that utility rates will decrease in that time span to below your PV system's KWH rate - and how likely is that??  So I think a PV system is a pretty good bet!

Water Used in Electricity Generation

An astounding fact that I learned recently is that for every kilowatt-hour burned 20-40 gallons of water is consumed in the generation of that kilowatt-hour.  This water is used to cool the steam generated by a coal, nuclear or natural gas power plant. A typical American household uses ~100 gallons per day.  But if you include the water inherent in the electricity usage, that figure increases to over 1,000 gallons of water per day!!  You can bet that as water becomes an increasingly valuable resource, especially in water constrained areas like the southwest and southeast US, this will add to the cost of electricity.

A PV solar system would eliminate this entirely because except for the manufacture of the solar energy  panels, no water is consumed to produce the electricity.  Very cool indeed!

I hope this series of findings was helpful to those of you out in the market considering PV for your home.  It has been a wonderful experience for me and my family and we are looking forward to many years of net neutral energy bills thanks to our new PV system.

Part 3 in a series of 4 posts from Dr. Nicole Peill-Moelter, the Director of Environmental Sustainability at Akamai, in which she documents what she learned while deploying a solar system on her home in California.  This segment covers financing options for solar systems, buy vs. lease and rebate and tax considerations.  This is great stuff...thanks Nicole.

Financing Options

Now that you're nearly ready to call the sales rep, let's look at various financing options that are available. 

PV solar companies now offer residential consumers financing options that make solar affordable for most anyone with sufficient electricity consumption, roof space and the right location.  These options include outright purchase of a system and system lease (or power purchase agreement).  What's best for you will depend on your situation including how long you plan to own your property, how much you can put down upfront and what your goals are, e.g., saving money or using renewable energy.

Outright Purchase

Outright purchase of a system may make sense for you if you can afford the capital outlay upfront and plan to be in your home for twenty or more years.  For example, a 5.0 KW system can cost in the neighborhood of $30,000, not including rebates and tax credits.  You are responsible for the maintenance, monitoring and repair of the system.  Since there are no moving parts, systems are generally low maintenance, requiring only cleaning of the PV panels and keeping the panels free of shading.  Although PV panels typically degrade less than 1% per year PV panels are warranteed for twenty years, and usually operate much longer than that.  Inverters have 10-year warrantees.  A twenty- to thirty-year amortization of your system usually results in a very favorable return on investment (ROI), e.g., energy costs of <$0.06/KWH.  You can also borrow money for the system which will lower the ROI but can still make sense given the strong ROI for systems used for 20-30 years. 

Even if you will be in your home less than 20 years, PV systems improve the property value so you can extract the residual value of the PV system when you sell.  Some cities are considering incorporating financing of the PV system into the home's property tax thereby tying the system to the home not the original buyer which overcomes a common financing hurdle.

Because you will own the system and be responsible for its operation, repair and performance you should thoroughly vet the PV and inverter technology and manufacturers.  For example, I learned that some cheaper PV panels can be of inferior quality resulting in leakage of the panels which decreases or ruins their performance. This is important if you want your system to last beyond the warrantee period.  In another example, micro inverter technology enables conversion of the DC electricity to AC at each panel.  The advantage of this is that if one panel is shaded or is not operating the other panels will still operate at full performance.  This is not so when the panels are linked together connecting to a single inverter as is the case for most systems.  If one panel is shaded or non-operable they all are.  Micro inverters are more expensive but may be worth it in the long run - especially if your roof is shaded.

System Lease

For those who cannot afford or don't want to outlay the full capital cost of a system upfront, more and more companies are offering a system lease, or power purchase agreement.  In this case the PV solar company owns, installs and is responsible for the system.  It also guarantees the annual output of the system for the life of the lease which is likely to be 10-15% less than the actual output.  One of the financial advantages of this purchase option is the PV solar company can take advantage of the business writeoffs associated with the system such as equipment depreciation which is not the case for a private owner. 

Lease agreements can range from zero down, 50% down to 100% down.  The advantage of 100% down is there are no finance charges which lower the ROI.  The lease allows you to lock in a guaranteed rate for your energy (KWH) which is not the case with your current situation.  At the end of the lease you can opt to renew the lease or have the system removed.

Unlike a purchased system the PV and inverter technology is not so critical for a leased system.  This is because the PV vendor guarantees the system output.  So it doesn't matter if you have a Ferrari or a Honda on your roof, it will get you where you want to go.

Rebates and Tax Credits

State rebates and federal tax credits help offset the cost of a PV system.  Rebates vary state by state and over time.  In California the California Solar Initiative (CSI) rebate has been in place for years and subsidizes systems under 1 MW on a per watt basis, e.g., 35¢/Watt.  This subsidy is reduced over time as the installed base of PV increases.  The federal tax credit is 30% of the cost of the system and is realized in the year that the system is installed.

If you purchase the system you are eligible for these rebates and tax credits.  If you lease a system you transfer the rights to these financial incentives to the PV vendor.  These incentives in addition to capital equipment depreciation and other business deductions enable PV vendors to reduce the cost of a PV system to consumers.

Part 2 in a series of 4 posts from Dr. Nicole Peill-Moelter, the Director of Environmental Sustainability at Akamai, in which she documents what she learned while deploying a solar system on her home in California.  This segment covers sizing your system, connecting to the grid, net metering and various other electricity related mysteries.  Thanks again Nicole!

How to Size Your Solar System

One of the initial steps in purchasing a PV system is estimating the total system power you need, in units of KW.  The system's power requirement is a function of the amount of energy, or KWH, your home uses each month on average, and how much you want offset by your PV system, e.g., 60%, 80% or 100%.  Your electric bill provides you with this information. 

A PV solar system of a given size has a rated power output in KW, e.g., 4.2 KW.  The actual output however will vary depending on your location and orientation of your roof.  Solar insolation, or radiant energy, and duration will vary from location to location, day to day, and season to season.  The National Renewable Energy Laboratory (NREL) and others collected a large body of data for the U.S. that provides fairly precise estimates of the amount of solar radiation and duration as a function of all of these parameters.  

The power output of your system can be precisely determined by multiplying the total system size by the average daily duration of sunshine for your location.  For example, a 5.0 KW system in southern California exposed to on average 5.0 hours/day of sunshine would produce on average 5.0 KW x 5.0 hours/day x 30 days/month = 725 KWH/month.  Note the system size based on the panel rating which is measured in a lab under standard conditions is not the actual power output of the system which is likely to be less due to system losses, e.g., 10% less.

By knowing your average monthly energy usage, the percentage of that usage you want offset by your PV system and using a proxy solar radiance of 4-5 hours/day you can calculate the approximate size of the system you need: 
Average Monthly Energy Usage (KWH) / 30 days per month / 5 hours per day ~ PV System Size (KW)

Net Metering

A common misconception about PV systems is that the electricity produced by the system is used by the owner directly.  This is not the case unless the owner is "off grid" meaning not connected to the electrical grid.  To be off grid requires batteries to store the produced electricity.  This makes the system significantly more expensive, and unless you can't connect to the grid, has little advantage except having power during a blackout; which for most of us, fortunately, is only a rare occurrence.

For the vast majority of installed systems, the electricity generated is delivered to the electrical grid and mixed in with other generated sources of electricity.  As the electrons produced by your PV system are delivered onto the grid from your connection point your electricity meter literally runs backwards!

What makes PV systems work financially for most is "net metering".  Net metering is an electricity policy, usually implemented at the state level which requires utilities to subtract the PV-produced electricity from your electricity bill - so you only pay the net of what you produce and use.  At the end of the year your utility company nets out how much electricity you produced against how much your PV system produced.  If you used more than you produced your utility will send you a bill for the difference.  If you produced more than you used in some states you will get a credit from your utility, generally a wholesale rate, e.g., $0.06/KWH.  In other states you get a big bagel - just a thank you from your utility for your generous contribution!

Net metering is instrumental in facilitating the adoption of PV solar.  It allows you to produce electricity in excess of what you use during the day, use the electrical grid for "storage" of your excess production, and draw from the grid when you are not producing.  Net metering applies to any small producer of renewable electricity, e.g., wind, geothermal.

Electricity Rates, Your Utility Bill and Other Mysteries

To understand how to evaluate the ROI of your PV system you need to understand your electricity bill and how much you are being charged - good luck!

Most electricity bills break down into four charge components:
1) Electricity generation charge
2) Electricity delivery charge
3) Bond charges
4) Tax & fees

The simplest way to calculate the basic KWH rate you're a paying is to add up the generation and delivery charges and divide by your total KWH usage. 

The "loaded" rate is calculated by totaling all the charges including any bond charges, taxes and fees and dividing by the total KWH usage.  These additional charges can increase the rate by 10% or more.

One thing to note is that the more electricity you use above a baseline amount, the more you are charged.  In our case our usage falls into the baseline, and the two tiers above baseline.  The rates for the two tiers above baseline are 53% and 377% higher than the baseline rate, respectively!  The baseline rate is generally quite low, e.g., near wholesale.  If you can keep your usage under the baseline threshold, e.g., 300 KWH/month, then your bill will be disproportionately reduced.

Calculating your rates and understanding your motivations for going solar will help you determine by how much you want to offset your electricity usage and, ultimately, the PV system size.  If you just want to save money then size your system such that your offset keeps you under the baseline threshold, whose rate is very likely to be cheaper than your effective PV KWH rate.  If you want to save money and not use fossil fuel, then you'll probably want to offset your usage 100%.