Solar Energy in Indiana

INDIANAPOLIS — As utility bills continue to rise, more Hoosiers are considering alternative energy sources to keep their homes warm in the winter and cool in the summer.

“Energy prices aren’t going anywhere,” said Kerwin Olson of the Citizens Action Coalition. “There is no end in sight”

Since installing a solar power system on her Indianapolis home in July, Courtney Conway says her family has drastically reduced their energy bills.

“In the summer months, when we use more energy, our bills are cut in half,” Conway said. “But in the winter months we expect it to completely replace our electricity bill, which is amazing.”

Conway says her family is saving enough on their utility bills to cover monthly payments for their $19,000 home solar system, which they also view as an investment in the future.

“It was something we could afford and it just feels good,” she said.

Take action before choosing solar

Savings like this are typical for residential solar users, according to Olson. At the same time, he recommends anyone considering a home solar system take several steps to ensure it’s the right decision.

“The first thing you should do before you do anything is do an energy audit at home,” Olson said. “Because you don’t want to solar power an inefficient house.”

On average, he says, most homes waste between 20% and 40% of the energy they use. Most utility companies offer home energy audits at a relatively low cost.

“I think Duke Energy offers a whole house energy audit with the blower door test for about $50,” Olson said. “AES Indiana offers free energy audits based on your household income.”

Other companies generally offer home energy audits for around $100 or $150, he said. Such audits can help determine where your home is losing energy. Any changes or upgrades to avoid wasting energy will cost more.

Next, Olson recommends a roof inspection before deciding to install solar panels.

“Many roofs are old, cracked, had problems,” he said. “Your foundation is not strong enough to hold the sun. So do a roof check, make sure your roof is fine.”

He says most roof inspections are generally offered by solar installers as a free service. You can also contact organizations dedicated to helping homeowners make the switch to solar, such as Solarize Indiana, Solar United Neighbors, or Siren.

Olson also recommends getting multiple quotes from solar installers and being prepared to pay more for your homeowners insurance for insurance costs. However, he says, such insurance hikes are usually minimal.

“Solar advocates have successfully stopped exorbitant insurance requirements for solar installations,” he said. “But that’s something people should definitely look into, whether their existing policies cover them or whether there are additional adders they would need to add.”

Conway says her homeowners insurance was unaffected by her solar system. In general, she has no regrets.

“Any money that we save from our smaller electric bill goes right back into paying off the actual system,” she said. “Feels worth it to me.”

Solar Energy in Indiana

However, Matt Schloss cannot say the same.

“Right now, I’d probably hold back if I was anyone else,” Schloss said.

For Evansville resident Schloss, part of the appeal of switching to solar power is that the system often produces more energy than a home uses. Utility companies then buy the excess, often resulting in a credit on a homeowner’s energy bill. Solar customers have been relying on this exchange for years to pay off their solar systems.

“The payout for some people is about 10 years or less,” Schloss said.

However, a recent change in state law brought about by SEA 309 is changing the landscape for such energy exchanges, which were formerly based on a one-to-one relationship called “net metering.”

“I thought it was going to be a one-on-one relationship,” Schloss said. “You know, if I buy electricity, they pay me the same for what they buy back. But that’s not how it works.”

Instead of a one-to-one energy exchange, CenterPoint Energy pays him about 40% for the excess energy he produces, according to Schloss. And that changes the outlook for how long it will take for him to pay back his solar system.

“So by my initial thoughts of 10 years or less, probably double that,” Schloss said. “Pretty crazy. I don’t know why they think their energy is better than mine.”

Olson and other solar advocates believe that changing buyback rates will pose a barrier to expanding solar home use in Indiana.

“Some of these payback periods actually extend beyond the design life of the system,” Olson said.

“20 years isn’t enough for most people, I don’t think so,” Schloss said.

However, utility companies and their representatives argue that the change in the law protects the vast majority of electricity customers who do not use residential solar systems.

“The original intent of the legislation was to ensure that customers who do not own solar generation do not subsidize those who do,” Indiana Energy Association president Danielle McGrath said in a statement. “Although they generate some of their own electricity, solar customers still rely on existing electrical infrastructure such as power lines, and the new tariff reflects the cost of doing so.”

“Under the new tariff, customers who generate their own electricity will continue to benefit from that energy for self-consumption and receive a 25% premium for the excess electricity they generate,” continued McGrath. “Solar customers are still being paid more for the energy they produce than the utility could buy wholesale. Overall, the law strikes a balance to ensure everyone using the electricity grid continues to pay their fair share for it.”

The interpretation of SEA309 is currently pending in the Indiana Supreme Court. Oral negotiations were held in mid-September and the parties involved are awaiting a decision.