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Solar panels: A green revenue stream

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Solar panels: A green revenue stream

In 2009, Ontario launched the Feed-in Tariff program. Since then, the use of solar panels has become much more popular because homeowners use them as a way to make money. If you install solar panels, Hydro hooks them up to the electricity grid and pays you to use the electricity that your solar panels produce.

It is a win-win situation. Hydro gain green energy at relatively low cost, while power usage is at a peak (during the afternoon), and homeowners can make money by selling the energy coming from a natural resource — the sun. Programs exist for commercial and residential, but here is some more information about the residential program.

What is the investment like?

 According to Peter Glover, sales manager at Ottawa Solar Power, a typical home could receive cheques worth $3,700 per year from Hydro. He said an eight kilowatt panel, which is about average, would cost $26,000 to install.

The Feed-in Tariff program is a 20-year contract. After approximately seven years you could pay off the initial cost and generate revenue for the next 13 years. This would be a take-away profit of $48,000.

These solar panels will not lead to an increase in property tax, even though it may increase the value of your home. Also, the Canadian Revenue Agency considers this an investment, so until the revenue compensates for the initial costs, you won’t have to pay taxes on it.

If you have old shingles, think about replacing them before installing solar panels. Also, some houses are better positioned than others to get the most energy out of the sun possible. You will make the most money if your house has a sloped roof and faces South, South-East or South-West. If you have a flat roof, solar panels can also be a good investment. It really depends on how much sun hits your roof throughout the day.

“It’s a very good return on investment, it’s ecologically friendly and it gives you a revenue stream for 20 years that you can use to pay your hydro bills, vacations or children’s tuition,” says Peter.

How can you do it?

1) You have to apply to the Ontario Power Authority. According to Peter, the wait time is about one to two weeks. A couple years ago he said it was four to six months, which caused a lot of frustration.

2) Get approval from hydro. They have the power of veto and can say that there is too much renewable energy coming from one area. Peter says in Ottawa this rarely happens, but in south-western Ontario it is common. The wait for this is approximately one week.

3) Get them installed. After you have approval you have six months to get the solar panels installed. Most companies do not do work on a shingled roof when there is snow, so keep that in mind. The installation process is about two and a half days — two days for the solar panel company to install everything and about six hours for the hydro to hook it up to the grid. The process is not invasive, but you have to deal with a six hour power outage while hydro hooks it up.

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