The commercial solar panel was created by inventor Charles Fritts in 1881. Those early panels were a scientific breakthrough but were inefficient in practice relative to coal-fired power. The modern design of the solar cell used in larger solar panels was invented by Russell Ohl in 1939. Bell Labs created the first economically efficient solar cells using the Ohl design in 1954.
I guess I caught the solar bug then because in 2018 I built the largest off-grid, non-commercial solar panel system in New England on my farm there. The system consists of nine steel pylons, each about 10-feet high. Each pylon supports a 15′ x 9′ array of solar panels. Each solar panel is 5′ x 3′ and there are nine panels on each array in a 3 x 3 configuration. The panels are made up of solar modules that in turn consist of hundreds of individual solar cells.I built my first solar cell in 1961 as a 10-year-old. It came in a science project kit of the kind that were popular at the time. I simply applied chemicals to a silicon wafer as instructed and generated a small amount of electricity.
The pylons have a cranking system so that each array can be tilted to face the sun at an optimal angle depending on the time of year. The entire system operates using the photovoltaic effect (converting photons of light into volts of electricity) and is therefore referred to as a PV System.
I won’t live long enough to save enough on my electricity bill
The typical response when people learn about this system is, ‘Well, now you have free electricity.’ Not exactly. It’s true that I pay nothing for the electricity generated. But the system was not free.
The panels, pylons, wiring, batteries, inverters, and construction costs including running buried conduits a quarter mile from the solar field to my house cost well into six figures. And that was before Trump imposed tariffs on imported solar panels. Construction costs have also skyrocketed since 2018 because of urban out-migration and the attraction of new homes in rural areas.
Our local electricity from the grid is moderately priced. The fact is I won’t live long enough to save enough on my electricity bill to amortise the cost of my PV System. That’s not why I built it.
I built the system to have electricity in the event of a collapse of critical infrastructure systems including the electrical grid. Don’t assume that won’t happen. The southeast US ran out of gasoline temporarily just a few weeks ago due to a hacked pipeline operating system. These catastrophes will happen more frequently in the future.
The next assumption people get wrong is that ‘Your house runs on solar power.’ Not exactly.
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It’s battery-powered — a critical intermediate link
The house runs on electricity from 40 Blue Ion lithium batteries stacked in five glass-fronted cabinets that are charged by the PV System. Yes, that electricity comes from the sun via the solar panels, but the batteries are a critical intermediate link in the chain. The battery array offers advantages and disadvantages.
The disadvantage of batteries is that they add to the expense and maintenance of the system and they have finite storage capacity. The advantage of batteries is that you have electricity to draw upon when the solar panels are not producing energy due to darkness, rain, snow, or clouds.
This points to an important aspect of powering homes with solar power and the use of solar power generally. Solar-generated electricity is a ‘use it or lose it’ source. If your solar panels are in the Arizona desert where it almost never rains and the electrical output can be fed directly into the power grid, then that can be an important supplement to other sources supplying the grid (although even Arizona solar panels can’t generate electricity at night).
Still, if the grid is already at capacity, then the additional solar power is wasted. If the grid is running low, solar power can’t help at night. The solution to this solar inconsistency in terms of grid operation is batteries, which are expensive and high maintenance.
Demand management is ‘use it or lose it’
The situation is similar in the home environment where you adapt your lifestyle to the rhythm of battery charge and discharge. With use it or lose it as a guide, we run all needed appliances (washing machine, dryer, dishwasher, vacuum cleaners, etc) to the maximum extent on bright sunny days when there is more electricity being generated than we can use. That way we can give the appliances a workout and the batteries are still full.
On cloudy or rainy days, we go easy on the appliances to conserve the batteries until the sun comes out again. It’s common sense and it’s easy to do once you get the hang of it. The point is your lifestyle adapts a bit to the reality of battery power in a world where the sun does not always shine.
So my system works fine, and I enjoy having it. A PV System of this type is highly educational when it comes to understanding the challenges of adopting solar panels on a wider scale.
Stay tuned for my next DR edition where I’ll talk about the scalability of solar and move on to other renewables.
Regards,
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Jim Rickards,
Strategist, The Daily Reckoning Australia
PS: This content was originally published by Jim Rickards’ Strategic Intelligence Australia, a financial advisory newsletter designed to help you protect your wealth and potentially profit from unseen world events. Learn more here.
