Composed by John Senechal john@baldmtnhomes.com

Cash flow affects landlords and tenants. Tenants are more likely to pay their rent if utility costs are low.

Don’t confuse solar heat with solar electricity! The two technologies are very different.

Passive solar is the starting point because it’s cheap.

This is what you’ll see most often on house roofs.

Active space heating systems are larger, requiring more panels and storage. The illustration fails to show the storage tank.

South facing windows are net heat gain in the winter. Shade them in summer to avoid overheating.

Use the existing structure as an example http://gnbbuilders.ca/main.php?title=custom_home_builders_vancouver_island

Windows are functional for light, egress, ventilation, and views. South facing windows gain more heat than they lose in winter BTU loss through windows is greater than any other part of the house.

Energy enters on all frequencies of light, including visible light Light energy is converted to heat energy. Heat energy is radiated as infrared frequency only Low-E glass blocks infrared, trapping heat inside the house

BTU loss is ‘dollar drainage’ through walls. U value is the inverse of R value. U is improved by upgrading or adding insulation. A is changed by limiting house size. T can be buffered with garages, solariums, unheated mudrooms, or shading.

This is an example of buffered exterior walls. The south wall is to the right; the photo is showing the west wall, bermed with tiny window. The north wall is bermed. Lighting is with skylights and light pipes.

The same house shows the south walls and the east, which is buffered by an unheated garage.

The south wall is open with lots of light. Overhead glass is shaded to prevent overheating. Thermal mass in the fireplace and slab floor moderate the temperature.

Example: A passive solar house.

Example: A remodeled house with added windows on the south to make it passive solar.

Example: Passive solar thermal mass in the river rock fireplace and stained slab floor.

Example: Passive solar south facing glass. The greenhouse is closed off in the summer when it is too hot.

Example: An entryway that is buffered. The wall to the right is the north side of the house. It is bermed with 7’ of earth. The wall on the left side is heated living space.

Example: The south walls of the house are designed to capture southern winter sun and block summer sun.

Example: An active solar space heating array that is ground mounted. If you have the yard space, ground mounted panels are easy to set up and maintain.

Local incentives for the City of Asheville. Many cities are implementing such strategies.

Our local electric utility gets to claim tax credits for these energy upgrades, and they pay us to do it.

Tax free income

North Carolina’s tax credits are among the best in the nation. They don’t promote it much, though. It costs them a lot when you actually claim the credits.

Dollars in your pocket. I expect the credits will be with us for awhile, but don’t delay… sign up now.

Such a giveaway…

Corporations get the same credits real people do, but more of them. Buy commercial property, incorporate, and you can get more tax credits back.

Pile on the paybacks.

Household hot water systems are pretty simple.

Sun Stuff Energy supplied the figures for a standard 2 panel domestic hot water system.

Thermacraft Energy Services uses these figures for a standard 2 panel hot water system. Note that installation cost vary, due to differences in houses.

This is domestic hot water for an apartment building in Asheville. The payback figures include the tax credits, but don’t include depreciation or utility incentives.

Total gas usage over the rehab period 2001-2006 decreased due to insulation and window improvements. 2007-2008 decrease is due to the active solar hot water system installed in 2007.

Total utility expenses are flat, reflecting decreased gas usage vs. increased costs. Electricity went up too. Compare the operating costs with the rental income increases.

Examples: Provided by Thermacraft Energy Services

Example: Provided by Sundance Power Systems

Example: Provided by Sundance Power Systems

Example: Provided by Sundance Power Systems

Example: Provided by Sundance Power Systems

Local solar contractors in the Asheville/Hendersonville area of Western North Carolina.

Solar Heat For Real Estate Investors

How many ways can I make money with Solar Heat? Tax Credits– NC and federal credits plus commercial deductions Incentives – conservation and efficiency through Progress Energy Cash Flow– decreased operating costs Added Value– improvements increase house price with low costs Future Security – resistance to fuel price shocks Maintenance – reduce load on heating systems, freezing problems Return on investment – 20% plus payback continues after the investment is returned

Three Types of Solar Solar Electricity Solar Daylighting Solar Heating

Three Categories of Solar Heat Solar Domestic Hot Water (DHW) Hot water for bath and kitchen Active Solar Space Heating Hot water for heating living areas Passive Solar Capture and conserve heat for living areas

Passive and Active Solar Heat Passive solar can provide 60% of heating needs in Asheville’s climate Conservation can increase comfort and economy Active solar heat can provide additional economy and benefits like warm floors Smaller floor plans are easier to heat Passive techniques require little extra cost or maintenance

Active Solar Heat Solar Domestic Hot Water Heaters Capture heat Store it for later Use when needed

Active Solar Heat Solar Space Heat Optional distribution strategies Optional storage strategies Larger systems capture more heat

Passive Solar Space Heating Increase mass indoors Shade for sun angle Orient windows

Passive Solar Heat Overhead glass – overheat in summer West windows – overheat in summer East windows – morning sun advantage North windows – minimize to save heat South windows – maximize for heat gain In the winter, shaded in summer Max window area should be 10% of SF Or 15% with thermal mass

Passive Solar Heat Windows Single pane glass window R-1 Double pane glass window R-2 Double pane glass window with low emissivity coating R-3 Triple pane glass window R-3 Standard 2x4 wall insulation R-15 Standard ceiling insulation R-38 South facing insulated windows gain more heat than they lose in winter.

Passive Solar Heat Low-E glass Low-E glass blocks infrared, trapping heat inside the house Heat moves in the infrared frequency only Light energy is converted to heat energy Energy enters on all frequencies of light

Solar Heat Heat flow BTU = UAΔT Heat costs $ $ drainage = UAΔT To slow $ drain, modify U, A, or ΔT U = wall heat transmission rating A = size/volume of the exterior walls ΔT = the temperature difference between inside and outside of walls

Solar Heat Passive solar can be elegant Photo: John Miller Photography

Solar Heat Remodel, adapt, reconfigure, design Photo: John Senechal

Solar Heat Passive solar mass provides a thermal flywheel that moderates temperature swings Photo: Fine Homebuilding Magazine

Solar Heat Passive and active solar work well together Photo: John Senechal

Solar Heat Passive tricks can improve any house that gets sunshine. Even on a steep north slope. This is a solar buffered entry with daylighting Photo: John Senechal

Solar Heat Passive is modern functional Photo: John Senechal

•8 4x10’ drain down solar flat plate hot water collectors rated ~300,000 BTU/sunny day •4000gal stainless steel, double insulated, vented tank, wrapped in radiant heat foil in a room blown with fiberglass insulation to supply the water for the radiant floor heat & for domestic use. •All ceiling, exterior, & 12” north facing walls have maximum insulation (Fiberglass, Styrofoam & Icynene) Active Solar Space Heat “Check out all available sources of information especially the NC & Federal Income Tax Credits and other programs that help make solar homes more affordable, healthier, livable, and practical.” Ske Boniske, Homeowner Credit: WNC Green Building Council

Will the city of Asheville help? Incentives The City of Asheville waives fees for building permits and plan reviews for certain renewable energy technologies and green building certifications for homes and mixed-use commercial buildings. Waivers for building permit fees may apply to residences with the following designations (the regular fee is in parentheses): HealthyBuilt Home Certification* ($100) Energy Star Rating ($100) Geothermal heat pumps ($50) Solar-energy systems ($50) Wind turbines ($50) Storm water (gray water) collection device for reuse in yard sprinkler or elsewhere ($50) Regular fees must be paid in full but will be rebated upon certification. These fee waivers also apply to mixed-use commercial buildings if they include residential space.     The city will also reduce plan review fees by 50% for any building that is seeking LEED** certification. Regular fees must be paid in full but will be rebated upon certification.  

Progress Energy incentives

Is the Progress Energy incentive payment considered to be taxable income? Incentive Type: Corporate Exemption Eligible Technologies: Solar Water Heat, Solar Space Heat, Photovoltaics Applicable Sectors: Residential, Multi-Family Residential Amount:100% of the subsidy According to Section 136 of the U.S. Code, energy conservation subsidies provided by public utilities,* either directly or indirectly, are nontaxable: "Gross income shall not include the value of any subsidy provided (directly or indirectly) by a public utility to a customer for the purchase or installation of any energy conservation measure.“ The term "energy conservation measure" includes installations or modifications primarily designed to reduce consumption of electricity or natural gas, or improve the management of energy demand. Eligible dwelling units include houses, apartments, condominiums, mobile homes, boats and similar properties.

Solar Tax Credits – North Carolina North Carolina offers a tax credit equal to 35% of the cost of eligible renewable energy property constructed, purchased or leased by a taxpayer and placed into service in North Carolina during the taxable year. A maximum of $3,500 per dwelling unit for residential active space heating, combined active space and domestic water-heating systems, and passive space heating; A maximum of $1,400 per dwelling unit for residential solar water-heating systems, including solar pool-heating systems;   A maximum of $2.5 million per installation for all solar, wind, hydro, geothermal and biomass applications for commercial or industrial facilities, including PV, daylighting, solar water-heating and space-heating

Federal Solar Tax Credits Personal Tax Credit 30% Technologies: Solar Water Heat, Photovoltaics, Wind, Geothermal Heat Pumps, Solar water heaters placed in service before 1/1/2009: $2,000 Solar water heaters placed in service after 12/31/2008: no maximum Carryover Provisions: Excess credit may be carried forward to succeeding tax year

Federal Solar Tax Credits A tax deduction of $1.80 per square foot is available to owners of new or existing buildings who install (1) interior lighting; (2) building envelope, or (3) heating, cooling, ventilation, or hot water systems that reduce the building’s total energy and power cost by 50% or more in comparison to a building meeting minimum requirements set by ASHRAE Standard 90.1-2001.   Deductions of $0.60 per square foot are available to owners of buildings in which individual lighting, building envelope, or heating and cooling systems meet target levels that would reasonably contribute to an overall building savings of 50% if additional systems were installed.   Corporate Tax Deductions

Federal Solar Tax Credits Corporate Tax Credit Solar Water Heat, Solar Space Heat, Solar Thermal Electric, Solar Thermal Process Heat, Photovoltaics, Geothermal Electric, Fuel Cells, Geothermal Heat Pumps, Solar Hybrid Lighting, Direct-Use Geothermal Applicable Sectors: Commercial, Industrial, Utility 30% for solar, fuel cells and small wind; 10% for geothermal The credit is equal to 30% of expenditures, with no maximum credit. Eligible solar energy property includes equipment that uses solar energy to generate electricity, to heat or cool (or provide hot water for use in) a structure, or to provide solar process heat. Passive solar systems and solar pool-heating systems are not eligible.

Federal Solar Tax Credits Modified Accelerated Cost-Recovery System (MACRS) Incentive Type: Corporate Depreciation Eligible Technologies: Solar Water Heat, Solar Space Heat, Solar Thermal Electric, Solar Thermal Process Heat, Photovoltaics, Geothermal Heat Pumps, Solar Hybrid Lighting, Direct Use Geothermal Applicable Sectors: Commercial, Industrial Businesses may recover investments in certain property through depreciation deductions. The MACRS establishes a set of class lives for various types of property, ranging from three to 50 years, over which the property may be depreciated. A number of renewable energy technologies are classified as five-year property The 5-year schedule for most types of solar, geothermal, and wind property has been in place since 1986 The federal Economic Stimulus Act of 2008, enacted in February 2008, included a 50% bonus depreciation - the owner is entitled to deduct 50% of the adjusted basis of the property in 2008 and 2009. The remaining 50% of the adjusted basis of the property is depreciated over the ordinary depreciation schedule.

Active Solar Heat Hot water usage averages 20 gal/person per day The average household spends $400–$600 per year on water heating

Active Solar Heat 2 panel system Solar domestic water system cost $7,295 Tax credits $3,588 Balance of cost to owner $3,707 Average payback per year $ 720 Payback period 5.15 years Cap value added @6% $12,000 Return on Investment 19.4%

2 - 4x8 collectors & 80 gallon storage tank $7,000 30% Federal Tax Credit - $2,100 Install cost – Federal credit $4,900 35% State Credit (max $1,400) - $1400 Total Installed System Cost - 2 collector system $3,500 Produce approximately 3350kWh @ $0.106 - $355 / yr System payoff 9.8 yr R.O.I. (after system payoff) 10.143% Active Solar Heat 2 panel system

Active Solar Heat – 6 panel system Cost $15,018 Credit $ 9761 Balance $ 5257 Payback $1100/yr Period 4.78 years Cap value $18,000 ROI 21% Solar hot water @100 Biltmore Ave. Copyright: Lightheart LLC

Passive and Active Solar Heat Gas Usage @ 100 Biltmore Ave. Copyright: Lightheart LLC

Passive and Active Solar Heat Income/expenses @ 100 Biltmore Ave. Copyright: Lightheart LLC

Photos: Thermacraft Energy Services

The Woodward House at Highland Lake Inn The 320 square feet of collectors can produce up to 320,000 BTUs a day, and can heat up to 500 gallons of water for this guest house and the laundry facility. Photo: Sundance Power Systems

Solar hot water system with 6 4X10 AET collectors, and 3 120 gallon Vaughn Solar Storage tanks for use in restaurant. Photos: Sundance Power Systems

Photo: Sundance Power Systems

The Mellow Mushroom Asheville, NC This 6 collector Solar Thermal System was designed to heat up to 20% of the 1,000 gallons of hot water that are used daily in the restaurant’s operations, greatly reducing operating costs while making a positive impact on the environment. Photos: Sundance Power Systems

Thermacraft Energy Services, LLC www.thermacraft.com 306 Elk Park Dr Asheville, NC 28804-2066 (828) 285-8825 Mike Pope Sundance Power Systems, Inc. www.sundancepower.com 11 Salem Hill Rd Weaverville, NC 28787-9346 (828) 689-2080 Dave Hollister Sun Stuff Energy www.sunstuffenergy.com 1200c Hendersonville Rd Asheville, NC 28803-3100 (800) 467-5541 (828) 277-8041 Peter Phelps First Light Solar www.firstlightsolar.com 239 Amboy Road Asheville, NC 28806 (828) 350-3993 Solar Dynamics http://www.solardynamicsnc.com 40 Green Valley Rd Asheville, NC 28806-1428 (828) 665-8507 Ole Sorenson Advanced Thermal Solutions www.gotsun.com 1630 Spartanburg Hwy # C Hendersonville, NC 28792-6828 (828) 693-3334 Thomas Koenig McNutt Service Group http://www.mcnuttservicegroup.com 110 Vista Blvd. Arden, NC 28704 (828) 243-5192 Rick Bailiss This presentation was composed by John Senechal John@baldmtnhomes.com