Whether you are building a new home or retrofitting an old one, consider utilizing a renewable source of energy. Aside from the obvious environmental benefits, you will find that most systems have a very good return on investment (ROI) that will make back the initial outlay in only a few years. If you are able to take advantage of a government incentive program (like the MicroFIT program for solar energy in Ontario), supplying the grid with energy will provide an extra stream of income that not only gives you a great ROI, but will make you a tidy profit to boot.
The systems featured in this article calculate a broad average for ROIs. Each case will be different depending on the kind of system you select and the location of your property. Ensure that you calculate a more accurate ROI for your exact location and system prior to investing.
Small-scale hydro systems utilize flowing water to turn a water turbine and generate electricity in an alternator. Micro-hydro systems generally operate with 30-70% efficiency and can power buildings like homes or small businesses. Viable micro-hydro systems require access to a water source with sufficient water head and flow rate such as a creek, stream or river, a waterfall or a dam with a drop in level that can be directed through a hydro system.
Most hydro turbines produce AC electricity which can be directly connected to the home. Micro-hydro systems have very little environmental impact. Prior to installing a system, you must ascertain the impact it will have on the plant and fish life in the downstream eco-system. You will need to create a small reservoir and you must ensure that this will not affect the structural integrity of the surrounding landscape.
Small wind turbines which produce 100 kW of electricity are utilized to augment city electricity supplies. In order to function optimally, your property must be located in an area that receives constant wind. You property must be at least an acre so that your wind turbine can be situated far from neighbouring properties. In order to produce sufficient electricity to be cost effective, your property should receive average annual wind speeds of at least 4.0-4.5 m/s (14.4- 16.2 km/h; 9.0-10.2 mph). Contact your local weather bureau to ascertain the average wind resources in your area.
With the current 30% government incentive for installing small residential wind turbines, you can expect an ROI of about 4-5 years on an average turbine.
Many local governments offer incentive programs for home and business owners who install 10 kW solar systems. These programs are really worthwhile for the homeowner who generates an income from supplying energy to the grid. As an example, we will be looking at Ontario’s microFIT program and the benefits it has for local home owners.
Solar systems are usually installed in the form of photovoltaic panels, although solar shingles are becoming a more popular option. Once the panels have been installed and inspected, the local power authority hooks the system to the grid and pays the home owner for the power generated. The homeowner signs a 20-year contract with the local government. Solar systems offer extremely attractive ROIs as the technology and efficiency has improved exponentially over the last couple of years. An average system can expect an ROI of 4-6 years with the rest of the 20-year contract as profit.
Not only is the ROI attractive, but the environmental impact is well worth the effort. Over a 25 year period, the home owner can expect to offset 509 762 Lbs. of CO2, 2 019.6 Lbs. of SO2 and 785.4 Lbs. of N2O.