Buying Solar Panels in Tuscon, AZ

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Information about Solar Panels in Tucson

Tuscon, AZ has a lot of very solid incentives for its residents to go solar. Between their state energy policies and preferential tax treatment, you will find a lot of ways to save money no matter how you go about installing your new solar panel system. Read on to find out why Arizona is one of the fastest growing hotspots for solar in the US!

For a broader state overview, see our Arizona Solar Energy page.

#1 Overall Solar Grade: Tucson, Arizona

B+
Overall Grade
10 years Avg. Payback Time (For Cash Purchase)
10.21 % Estimate IRR (Return on your investment on cash purchase over 25 years)
$27,791 Your Net Profit Over 25 Years (Cash Purchase)

* Note that these are estimated values for informational purposes only, and do not take into account the full complexity of all financial projections. They also only apply to cash purchases, which means your numbers will be different if you lease your system or pay for it with a loan (factoring in interest). Also note that we are not financial advisors, so this information should not be construed as financial advice.

#2 Options for Buying Solar Panels in Tucson

In Tuscon, you’ll have access to all three major methods of purchasing solar power:  cash, purchase power agreement, and loans. Which method works best for you depends on your individual circumstances, but we’ll take a look at all three to highlight the pros and cons to each route you could take. All three options offer some type of financial benefit, but these benefits will be higher or lower depending on your selection.

Cash upfront

There are always clear benefits to paying for something up front and having cash in this situation it offers great results.  

In the purest sense, paying cash for means you’ll avoid any type of interest-bearing loan and there will be no strings attached once you’ve made the payment. You could sell your house the next week and wouldn’t have to worry about transferring a loan or lease to the new homeowner. It could also allow you for more wiggle room when you are hammering out the details with your installer.

Writing a check for $16k out of your pocket to pay for a solar system outright might sound a little scary, but let’s look at the math and see how it plays out.

  • If you use cash, you’ll spend about $16,283 up front to pay for your solar system during the first year of ownership. This is a huge upfront cost, but let’s see what happens next.  
  • When filing your federal income taxes for the year you’ve purchased your system, you’ll be able to take advantage of the amazing 30% federal renewable tax credit for $4,885. 
  • The state of AZ has an awesome tax credit of 25% up to $1,000.
  • You will be saving about $1,003 during your first 12 months electricity bill costs.
  • That takes your upfront costs down to about $9,395 that first year, big savings.

Your solar system will generate about the same amount of energy year after year in its lifetime, but the cost of generating this energy will stay mostly the same (just maintenance costs).

The energy from your local utility provider, as we’ll discuss below, will normally increase by around 3% per year on average. TEP, Tuscon’s electric company, has proposed rate increases of about 9% next year for the average homeowner. With solar, you will only be saving more and more money when your energy company raises their rates!

- Bottom Line

Looking at the cash method summary, your system will generate about $27,929 in savings over its lifetime and pay for itself after about 10 years of operation.  rom that point, you’ll be making money each and every year!  From an investment perspective, you’ll be earning something like 10%+ over the lifetime of your system, which is not too shabby.

Leases

For those of you that do not have access to a lot of cash, don’t want to obtain a loan to purchase a system, or for whatever other reason do not wish to actually own your solar panel system leasing is an option that can provide the least amount of hassle on your journey towards solar. When you lease a solar system, someone else (usually your installer or utility company) will actually own all of the equipment installed on your home. They will install it, monitor it, service it, and replace any parts that fail due to normal wear and tear.

Because you won’t be responsible for the system after it’s installed, leasing can be the least stressful option to go solar. But because someone else owns the equipment, you won’t get the full financial benefits of going solar such as the tax credits and rebates.

In Tuscon, the local utility company, Tuscon Electric Power, actually has its very own residential solar leasing program. Under their terms, you will pay a small fee to have your system installed and then you will pay a fixed cost on the system over the duration of your lease based on your previous 12 months of usage.

- Bottom Line

This will allow you to get the non-financial benefits of solar (environmental protection, peace of mind) while still mostly breaking even on your energy costs. We’ve seen that the typical monthly electricity payment in Tuscon, AZ is about $131 per month so we can assume that this would be the average cost of a solar lease. The one financial benefit is that your lease price is locked in so as utility prices increase over time you will still keep your monthly bill about the same!

More: Solar Leases

Loan

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Taking out a loan to pay for your solar system has a clear benefit:  you won’t have to pay a large sum of money upfront. In this scenario, we’ll consider that you are borrowing money from a bank (or equity in your home in the case of an HELOC) to pay for the system, but you still get all of the tax benefits associated with solar. It’s a little counter-intuitive to think that financing a purchase like this will make you money over the long term, but because the potential for energy savings with solar increases over time there is a substantial financial opportunity.

Let’s use the $16,283 system cost from our earlier cash example. Let’s also assume for our math that we’re getting a 4.5% interest rate on our loan and it’s over 15 years. But remember how I said that you will still get the tax benefits when you take out a loan?

  • After the first year, you’ll get back $4,885  from your federal taxes and $1000 for you state taxes
  • The issue with taking out a loan is that you will have to service this loan and its interest each month. Because of this bill, you’ll probably spend about $129 a month on your loan payment. This is $1,500 per year.  
  • Your savings for the first year will only be about $1,003, leaving you with about a $41 per month cost for your solar energy over the first year. Don’t forget that your electricity bills will tend to increase over time and you will end up paying relatively smaller amounts for your energy. 

- Bottom Line

Looking at it from this angle, you’ll pay about $6,138 in interest on the loan, and bank about $21,719 in savings with this system over the 25-year lifetime, simply by installing it and paying for the loan. It’s almost like printing money.

More: Solar Loans

#3 Solar Policy Information

A bit of good news for anyone living in Arizona is that their state government is relatively enthusiastic about endorsing solar energy production in the state. The bad news is that the utility companies in the state are actively fighting against the friendly solar policies now in place. These utilities, including the Tuscon Electric Power company, are attempting to make going solar less attractive to citizens by lowering the amount of money paid for excess electricity fed back into the grid and increasing minimum charges on power bills.

Renewable Portfolio Standard

A state’s renewable portfolio standard (RPS) can be defined as the policy that outlines exactly how much production energy the government wants utilities to generate from renewable sources by a certain date. Basically, this is a way for the state government to set out a goal for renewable energy and force their utility companies, who might not otherwise be incentivized, to start investing in renewable sources. For anyone interested in going solar in Arizona, it’s great news for your that your state has an RPS because it means that the government is enthusiastic about solar power generation.

Arizona’s RPS was passed in 2006 and outlines a plan for the state to generate 15% of their total energy production from renewable sources by the year 2025, with 30% of that coming from distributed energy technologies (basically on-site energy production like a home solar unit). Of that 30% mandate, half should come from residential sources alone!  This isn’t the most ambitious policy, but it is definitely a step in the right direction and a firm foundation for the future. We would love to see them update their plan with more ambitious goals, a longer timeline, or a greater requirement for residential solar.

We would love to see them update their plan with more ambitious goals, a longer timeline, or a greater requirement for residential solar.

Electricity Prices

The price you pay for your electricity matters a lot when discussing solar power because this is the cost that you will be offsetting by installing a solar panel system. On average, citizens of Arizona pay about 12.7 cents for each kilowatt-hour on their electric bill, while those living in Tuscon should be paying closer to 11.5 cents depending on their usage levels. The US average, meanwhile, is about 12 cents. This means that you are usually paying a smaller amount than the rest of America for your electricity.

It also means that you will be saving an average of $1,114 per year on your electricity bill in Arizona with a 5-kilowatt system.

It is also important to remember that utilities tend to increase their prices by about 3% per year nationally, but some areas can see increases of much, much more. The good news for you is that the electricity you are producing with your home system won’t cost any more to you as time passes, but you’ll be able to increase your utility savings every year during the life of the system.

Net Metering

As an owner of a solar panel system, you are basically the owner of your very own power plant. What this means is that your home will obtain its energy from your solar system first and then draw any extra power required from your normal utility company. If you have a powerful system or you are very frugal with your energy use then you might actually be generating more kilowatt-hours than you are using.

In this scenario, net metering is extremely beneficial to you because it will allow any excess power to be given back to your cities electrical grid. It also creates a system in which you can be paid for the excess electricity you generate. Because solar panels generate most of their energy during the daytime, it is essential that you are able to use this system of give-and-take in order to keep your home reliably powered.

In Arizona’s state net metering policies, you’ll see no limit to the amount of people that can plug into the system and they will actually pay you for any excess energy that you deliver to the grid. Of course, there are a few odd exceptions, but generally, the utility company will pay you the retail rate (what you would normally pay them) for any power you generate. Excess energy will be credited throughout the year and any remaining credits will be paid on your last monthly bill of the year as an avoided cost payment.

For anyone in Tuscon, please keep an eye on your local battle over net metering and be sure to submit your opinion to any local politicians that can help keep net metering safe!

More: Net Metering

Interconnection Rules

These rules determine how exactly someone can connect their solar panel system to their local electrical grid. There are a lot of technical details in these rules that may or may not apply to you, but we’ll go over a couple of the most important aspects.

Unfortunately, Arizona does not yet have an officially supported and mandated interconnection policy at the moment. They instead have drafted some proposed rules and have asked state utilities to follow their interconnection document as a guideline for their policies. In practice, most of the utilities have adopted similar rules based on this outline.

Tuscon Electric Power (TEP) established its own interconnection rules that go over the specifics of their service area. Generally, the customer must submit an application showing that their system conforms to electrical code, adheres to their local specifications, and includes a disconnect switch. Be sure to discuss these details with your installer and be sure that you are confident that you are conforming to any requirements that your local utility mandates!

#4 Financial Incentives, Rebates, and Tax Credits 

When solar first arrived in many states and governments were starting to endorse solar energy production by mandating RPS policies a lot of different rebates started popping up from local utilities trying to ensure that they met their quota.  Arizona’s utilities were no different, but as time passed and quotas started to be filled, these rebate programs started to dry up a bit.

Rebates and Other Incentives

solar-powered-tucson

In Tuscon, you are likely serviced by Tuscon Electric Power for your electricity needs and while their TEP Residential Solar Program started in 2015 was created to help provide leasing options for its citizens, the program is currently not accepting any new participants in for foreseeable future.

In Arizona, there are only a few utilities left that are offering any kind of rebate and most are located in rural areas. Here are some of the most significant ones listed below just in case you are planning on making a move in the future.

Tuscon, AZ Tax Credits

Tax credits in Tuscon are a solid offering. Overall it rates very highly in terms of tax implications for a new solar system. Let’s take a look at how you can save money on your taxes and more easily afford to purchase a system that provides clean, renewable energy for decades!

Arizona State Tax Credit

Although there are no state or local rebates in Tuscon, the state itself provides an awesome credit for would-be solar buyers. This credit will be equal to 25% of the cost of any solar device purchased, up to a maximum of $1000 for each residence. You can reach this maximum through multiple installations or all at once on a big solar panel system, but you can never exceed the lifetime maximum. You can also carry this credit forward for up to five years if you owe less than the credit amount.

This is nice icing on the federal tax credit cake that we’ll check out below!

Available Federal Tax Credit

As per usual, anyone that takes the jump into solar will enjoy the residential renewable tax credit. This amazing subsidy by the US government will allow for a 30 percent federal tax credit for any costs relating to the purchase and installation of a new solar system for your home. This allows you to shave 30 percent right off the top of your purchase price if you are paying cash or taking out a loan for your system. Remember that if you lease your system you will not get this credit. It will instead go to the owner of the panels that you are leasing from!

Tax credits are not deductions, but rather a dollar-for-dollar credit that is reimbursed to you for your purchase. This is truly an awesome opportunity that you should take advantage of before it starts to decrease after 2019!

Property Tax Exemption

Here is another area that Arizona rates very highly. According to their Energy Equipment Property Tax Exemption policy, citizens are exempted from paying property taxes on any equipment that provides energy to the home through renewable means.  This can include solar panels, but also things like geothermal electric, solar pool heating, hydroelectric, and even anaerobic digestion!

You will receive a 100% exemption if you make a purchase in any of the eligible categories. Remember though, that even though these devices are considered to add no value to the property for tax purposes, it will definitely still add value to your home for the purposes of selling it!

Sales Tax Exemption

According to Arizona’s Solar and Wind Equipment Sales Tax Exemption, you will currently pay NO sales tax on any eligible equipment related to solar energy. This is an excellent benefit because sales tax on a $15,000 system would be $1,215 under Tuscon, AZ’s current tax rate of 8.1%. This is a pretty sizable discount!

General Increase in Home Value

We discussed earlier that your property taxes will not increase due to the installation of your solar system because it does not count as added home value, but a good solar panel installation has been shown to demand a $4 per watt price premium over similar homes!  Looking at the numbers, that means a 5-kilowatt solar system could be adding as much as $20,000 to the value of your home while paying no additional taxes on your property. This makes for a sound financial investment for those of you living in Tuscon. Assuming you pay cash for your system, you could come out way ahead if you sell your home just for the increase in value alone.

Assuming you pay cash for your system, you could come out way ahead if you sell your home just for the increase in value alone. This type of return lumps solar into the category of any other home improvement that can increase the value of your home such as bathroom renovations or additions.

What to do next?

For those of you in Tuscon looking to go all-in with solar, I think that the numbers presented in this article make a compelling argument for you to take the plunge. Depending on your current financial state, you stand to come out way ahead in a short amount of time from a home value perspective. Factoring in the lower energy bills and peace of mind that comes from doing your part to help the planet and ensure a safe future for your children, it’s an easy decision.

Arizona currently ranks 5th in solar capacity in the US and it shows no signs of slowing down. As solar prices continue to drop and more people learn about the benefits of installing a solar panel system on their home, the solar environment just gets better and better!

As always, we highly recommend that you reach out to a local installer to give you an actual solar quote for your unique situation. All of our information here are estimates based on state averages.

Photo Credits: CC License via Flickr – 1, 2 

How to Find a Pre-Screened Solar Pro

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Finding the right Solar Pro

One of the most difficult parts about going solar is choosing your installer. So much rests on the shoulders of the contractors you hire. Depending on where you are, you might have dozens of companies to dig through, and it’s all too easy for analysis paralysis to set in.

So, where do you start?

On option is to use the SolarReviews Pre-Screened Solar Pros accreditation as an example. They estimate only the top 20% of all solar companies can earn the accolade, which makes it a nice measure for selecting the cream of the crop. Even if you don’t use a company directly from SolarReviews’ list, a good understanding of how the award works will help you to make a good selection.Continue reading

Where is the Best Place to Find Solar Company Reviews?

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Finding Solar Company Reviews

Finding a reliable contractor is crucial to make your solar dream a reality.  Hiring a fly-by-night installer is a very quick way to turn your solar dream into a nightmare – so how do you make sure you pick a good company?

Image: Yes, these guys are drilling holes in your roof.

Looking at solar company reviews should be your first step in picking who you do business with. By themselves reviews on the internet aren’t worth all that much, but they’re a good starting point. While you should never make a decision off the back of a single review, the general tone of things should provide you with a solid idea of a company’s reputation and character. Take note of things that crop up a lot – if a dozen people are all saying the same thing, that’s a good sign that you’ll have a similar experience. If a company has responded to a review you can use the quality and tone of that response as another measure to help you form an initial opinion.Continue reading

California Solar Tax Credit: What you Need to Know

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The California Solar Tax Credit is the California Solar Initiative

California is the biggest market for residential solar in the country. In fact, among the 10 states with the most solar, California alone has more solar than all the others combined! I think we can safely say that in California the solar industry – unlike in other states where solar is only now just catching on – is a matured industry, with a lot of experience and growth under its belt.Continue reading

How Big and Expensive Is a 20 kW Solar System?

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First things first, a 20 kW solar installation is BIG!

The average home solar installation in the United States is 5.6 kW, so a 20 kW system is almost 4 times bigger!

If you’re interested in installing a 20 kW solar system, chances are this is a commercial installation or your electricity use is really high compared to the national average of about 900 kilowatt-hours per month. Maybe you live in an area that regularly sees summer temperatures over 100 degrees F and so you have to crank that air conditioning all summer to stay comfortable (AC is one of the biggest users of electricity in our homes!). Or maybe you live in a large house (read: mansion), so you have a lot of lighting and space to air condition. If this is the case, great! You are a prime candidate to go solar. The higher your electricity bill, generally the more you can save by installing a solar system.Continue reading

Florida Solar – Going Solar in the Sunshine State

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Thinking of installing solar in sunny Florida? 

You’re not alone! The state ranked 17th in the most solar installed in the US in 2015. Not too bad considering Florida lacks many of the incentives that heavily discount the cost of going solar. However, the state sees excellent weather for producing your own renewable energy and homeowners can take advantage of numerous tax incentives to save even more money going solar!

If you’re looking for information on going solar in specific cities in Florida, check out our articles on Going Solar in Orlando, Going Solar in Central Florida, Going Solar in Gainesville, and Going Solar in Ft Lauderdale.

#1 Overall Solar Grade: Florida

C
Overall Grade
12 years Avg. Payback Time (With Cash Purchase)
3.41 % Estimate IRR (Return on your investment on cash purchase over 25 years)
$17,422.51 Your Net Profit Over 25 Years (Cash Purchase)

Florida has some excellent policies to both encourage the growth of the solar industry and make going solar as easy as possible for homeowners. Unfortunately though, financial incentives like rebates are a huge hole in the state’s solar outlook and their general lack of financial incentives has plagued the solar industry in the state for years. Florida solar is buoyed up a bit by the state sales tax exemption and property tax exclusion and Florida homeowners are also eligible for the 30% federal tax credit as well.

The financial savings is still lower than other states with pro-solar policies, you can still save thousands of dollars going solar in Florida!

* Note that these are estimated values for informational purposes only, and do not take into account the full complexity of all financial projections. They also only apply to cash purchases, which means your numbers will be different if you lease your system or pay for it with a loan (factoring in interest). 

#2 Options for buying solar panels in Florida

Florida homeowners have plenty of excellent options to own their own solar installation, from cash upfront to PACE financing. Really it’s just a matter of deciding which financing type most suits your needs. Each has their own drawbacks and benefits.

Cash upfront

Ah, the cash purchase. No matter what you’re buying – a solar installation, a car, a private plane – you can pretty much rest assured that you’re making the most financially responsible decision if you can simply purchase the item outright. It’s simple and cost-effective. No interest rate, no loan fees, no annual rate increases (like with solar leases). However, you need a pretty big sack of money saved up to buy something as big as a solar installation. After applying the 30% federal tax credit, an average-sized (5 kilowatt) installation in Florida runs about $11,600. Many of us simply don’t have that kind of change just lying around. Thankfully, there are some excellent alternatives available to Florida homeowners! Take a look below to learn more.

If you can afford it, outright ownership of your solar installation comes with some definite perks. First, you’ll see a better return on your investment than with a loan or lease. Secondly, as the sole owner of the installation, you are eligible to receive all available financial incentives, including the federal tax credit, state sales tax exemption, and state property tax exclusion. These tax incentives drop your installation price by over 30%! That’s a sweet deal! Keep in mind though that with ownership comes the responsibility to maintain, repair, and monitor your installation. Solar is fairly hands-off. There are no moving parts, and major equipment like the panels and inverter comes with long-term warranties, so maintenance responsibility isn’t really something you should worry about. It’s just something you need to be aware of.

Leases

Leases and power purchase agreements (PPAs) are two very popular types of third-party ownership for residential solar. With leases and PPAs, solar installers provide the initial funds to install the solar system and homeowners are required to pay little to no upfront costs. To the homeowner, leases and PPAs look very similar – you pay little upfront and then pay off the installation in monthly increments over 20 years.

The state of Florida is one of the very few states in the United States that outlaws third-party ownership of solar. Utilities are the only businesses that are legally allowed to sell electricity.

Legalizing solar leases was one positive piece of Amendment 1, the solar amendment that was thankfully voted down by Florida residents during the 2016 election. Why, you ask? Most in the solar industry agree that legalizing solar leases would be a huge step forward for the state’s solar, but the amendment also included provisions backed by utilities that would’ve allowed them to charge solar customer more money. The solar industry ultimately breathed a sigh of relief when the amendment didn’t pass.

More: Solar Leases

Loan

Loans are becoming increasingly popular to finance residential solar installations. They give the benefits of ownership (higher financial savings than with leases and eligibility for financial incentives) while not requiring the high initial investment. The financial savings of a loan-financed solar installation depends greatly on the size and total cost of the installation as well as the loan details like interest rate, fees, and loan term.

Banks, credit unions, third party solar financiers, and even utility companies will offer loans for solar installations. Oftentimes solar installers will have a preferred lender they work with, so if you’re interested in taking out a loan for your solar installation, go ahead and start talking to a few different installers to see what options are available in your area.

There are also a handful of utilities throughout Florida that offer solar loans with low interest rates, including:

  • The City of Tallahassee Utilities offers 5% interest loans up to $20,000 to residential customers for a variety of renewable and efficiency measures, including solar installations, home insulation, and high-efficiency air conditioners.
  • The City of Lauderhilll’s Revolving Loan Program mainly provides small loans for high-efficiency appliances like dishwashers and washing machines, but solar installations are eligible as well. The maximum loan amount is capped at just $2500 – likely lower than your solar installation’s total cost – but the loans are interest free for the first two years! If you live in the area and are eligible for the loan, take advantage of this incredible offer from the city to at least partially pay for your installation.
  • The Solar and Energy Loan Fund, a non-profit solar and energy efficiency financier, has partnered with the Orlando Utilities Commission, St. Lucie County, and the City of Orlando to offer unsecured loans to local residents for solar installations. Interest rates range from 7% to 9.5% and the loan can last between 3 and 7 years. These interest rates are fairly high, so make sure the financial savings are there before signing the agreement.

More: Solar Loans

PACE Financing

PACE (Property Assessed Clean Energy) financing is a fairly new –and exciting – way to finance solar installations that is currently available to Florida homeowners in certain cities. Through PACE, local governments provide financing for solar installations for homeowners and/or businesses, who then repay the installation costs through assessments on their annual property tax bills.

The city of Berkeley, CA, began the first solar PACE program in the 2000s, but unfortunately this financing type has been mired in controversy since it began, mostly revolving around property liens and who would be paid first – the PACE financing or the home loan- if a homeowner defaults on her mortgage. The struggle culminated in Fannie Mae and Freddie Mac publishing a notice refusing to issue mortgages to homes involved in the PACE program.

Since that tumultuous time though, Fannie Mae and Freddie Mac have jumped on board the PACE train and have agreed to work with homeowners with PACE financing as long as certain criteria are met. With these roadblocks cleared, PACE has grown across the country and Florida is one of the first adopters for residential solar!

PACE financing offers some really excellent advantages to homeowners. First, there is no large upfront payment required like a cash purchase. Secondly, unlike a lease or loan that is tied to the homeowner, PACE financing is tied to the home address, so the trouble of transferring a lease or PPA agreement to a new homeowner (which can sometimes get messy), is a non-issue! The local government typically ensures low interest rates and long terms, so going solar is easy and cost-effective.

To offer PACE financing, local governments partner with organizations that provide funding and can run the program on their behalf. There are currently three PACE organizations in Florida, each working in different areas:

  • Residents in the certain cities in the counties below can secure PACE financing through The Ygrene Energy Fund and their local government. Be sure to check Ygrene’s website to see if your city is on the list!
    • Alachua County
    • Broward County
    • Charlotte County
    • Marion County
    • Miami-Dade County
    • Orange County
    • Palm Beach County
    • Pasco County
  • The Florida PACE Funding Agency, an organization originally created to facilitate PACE financing in the Kissimmee area, has grown in size and now runs PACE programs throughout Florida, including:
    • Fort Meyers area
    • Fort Lauderdale area
    • Ocala area
    • Gainesville area
    • Pensacola area
  • RenewPACE also offers PACE financing through local governments to homeowners in certain cities in the following counties.
    • Alachua County
    • Broward County
    • Charlotte County
    • Indian River County
    • Levy County County
    • Martin County County
    • Miami-Dade County
    • Orange County
    • Palm Beach County
    • Pasco County

Comparison of Savings for Different Financing

We’ve compared the financial savings from the different financing options to help you decide what makes the most sense for you. Using Florida-specific industry averages for cost, we compare the savings between financing with full cash upfront and through loans.

How We Find our Savings

We looked at financial savings of an average-sized 5 kilowatt installation over a 25 year period. To compare the cost of going solar to utility rates, we used the state average of $0.1139 per kilowatt-hour with an annual increase of 3.5%. We also assumed a 0.08% decrease in the production of the solar panels each year, to account for degradation of the panel components (a standard allowance, as solar panels produce a little less electricity each year they are installed).

For our financial savings calculations with a solar loan, we used 12 year term with 5% interest, a fairly standard loan agreement for solar.

Total Savings: $10,000 to $18,000

First off, no matter the financing type, you can save $10,000 to $18,000 over 25 years by going solar in Florida! If you’re looking for the absolute best savings, cash upfront is the way you’ll want to go. For an average-sized installation, you can expect to save about $17,844 over 25 years!

If you don’t have enough cash to fork out for a solar installation, you can still almost $11,000 with a solar loan. Keep in mind though that when financing with a loan the total financial savings will vary by interest rates. Higher interest rates will see lower savings. At the end of the day though, even with a higher interest rate, you’ll still be realizing thousands of dollars in savings – all with no upfront payment!

Payback Time: 12 to 18 years

Payback time is the amount of time it takes to recoup your investment. In the solar industry, a payback time of 5 to 10 years is considered excellent to very good, and 10 to 15 years is considered average. Over 15 years is quite a long time to wait to recoup your investment….

For cash purchase, payback time for Florida solar hovers around 12 years. Certainly not the best, but the longer payback is no surprise considering the real lack of any financial rebates to decrease the total cost of installations.

With a 5% loan, the payback period jumps to 18 years. That seems like a long time – and admittedly it is – but once the installation is paid off, you’ll be enjoying your renewable, no-cost electricity!

#3 Solar Policy Information

Florida has some very supportive policies for residential solar. In fact, they’re some of the best in the southeast, if not some of the best in the country! On top of all this, the state sees sunny skies perfect for producing good, clean energy. It’s no wonder SolarCity, the largest solar installer in the country, just decided to start working in the state in December 2016.

Net Metering

Florida has fantastic net metering policies that are very similar to other pro-solar states. The law, passed at the same time as the interconnection guidelines, requires investor-owned utilities to offer customers net metering incentives for residential solar installations by providing full retail credit for any excess electricity produced by the installation. Homeowners accumulate net metering credits over the course of the month and the credits roll over month to month. At the end of 12 months, homeowners can cash out their credits at the utility’s avoided cost, which is typically based on what the utility pays for the electricity they produce. This is usually only a fraction of retail cost, but, hey, cash is cash!

The best part about these net metering incentives? They’ll be around a long time, as the law makes no provision to phase out the incentives as more people install solar (a common tactic in other states). So no matter how many people install, these incentives will always be in place!

Through passing these net metering rules, the state of Florida allows you to save even more money over the life of your installation.

More: Net Metering

Interconnection Rules

The State Ensures an Easy Interconnection Process

Interconnection is the process to connect your solar installation to the electricity grid, usually involving an application to and approval from the utility. As you can imagine with utilities involved, this is sometimes a slow and arduous process for homeowners. Utilities need to keep tabs on how much electricity is going into the grid so they can better plan for the future and ensure their infrastructure isn’t overburdened (and potentially cause blackouts). To this end, pretty much every homeowners across the country, regardless of the state they live in, must receive approval to connect to their installation to the utility grid. In some states, there is a long, long wait before your installation can get up and running – a few years ago, Maryland homeowners going solar had to wait more than 2 ½ months for approval from their utility Pepco!

Solar Access Rights in Florida

Over the past 5 years, solar access rights have become an increasingly important issue across the country. More and more situations have popped up where solar homeowners have had to defend their right to go solar and even their right to sunlight.

Sound crazy? Well, imagine that you want to install solar panels on your roof, but your Homeowners Association doesn’t like the look of rooftop solar and denies approval for your installation? What recourse do you have to continue moving forward?

Imagine still yourself in a situation where you just spent $15,000 on beautiful new solar panels. The next day, your neighbor, unaware of your solar panels, plants trees that block the sunlight from hitting your panels and your energy production drops to almost nothing in an instant! What do you do? Ask her to remove the trees? What if she says no? Sue? Call the police? What if you installed your panels while the trees were just little saplings, but 10 years later they’re shading your installation and your production drops?

All of these situations have been experienced by homeowners across the country and many pro-solar states, seeing renewable energy as more important than the aesthetics of a neighborhood, have passed laws protecting solar installations as well as access to sunlight.

In 1978 (and amended a couple times since then), Florida passed a law making it illegal for HOAs to block approval of rooftop solar installations. This is great news for Florida homeowners. In other states, homeowners aren’t so lucky and HOAs can deny rooftop solar. The Florida solar law does allow HOAs to request that homeowners move panels from a visible front portion of the house to the back if, and only if, the change doesn’t affect the installations’ energy production – a fairly standard allowance in other states as well. If you’re going solar in Florida, no need to worry about your HOA. Some can be finicky or picky, but in the end they cannot block your solar installation!

Shading issues on the other hand, are a bit more nuanced. There are currently no laws in Florida protecting the ‘right to sunshine’ for solar homeowners. If your neighbor plants a tree that blocks sunlight from hitting your solar panels, even if they planted the tree after you installed your solar system, you have little legal recourse to make them trim or remove the offending trees. Florida courts typically sides with whoever is acting in accordance with state property rights, so if your neighbor isn’t doing anything illegal on his property (planting trees is legal, after all), there’s not much you can do about the shading since it’s his legal right to plant trees on his property.

Other states have solar access laws protecting the ‘right to sunshine’ for solar homeowners. After a 2008 lawsuit in northern California, state lawmakers passed regulation giving solar homeowners the power to force neighbors to cut or trim trees shading their installation if the trees were planted after the panels were installed.

The best course of action for Florida homeowners going solar is to intelligently plan were to install solar panels, taking into account the height of any nearby trees over the next 20 years. Just as important, having good relationships with neighbors allows you to find solutions peacefully and amiably if any issues arise. For more information on solar access laws, check out our article Stop Shading My Solar Panels! Solar Access Rights in the US.

Renewable Portfolio Standards

Renewable portfolio standards (RPS) are an important driving undercurrent of solar adoption and lawmakers in many states like California and New Jersey have adopted RPSs, which set a goal for how much energy in the state must come from renewable sources by a certain date. Colorado, for example, set a mandate in 2004 that 30% of all electricity generated by investor-owned utilities must come from renewable sources by 2020. Hawaii has set a goal of 100% renewable energy by 2045! RPS mandates force utilities to adopt and encourage renewable energy much faster than they would otherwise do naturally.

Unfortunately Florida has yet to adopt any RPS goals for any sort of renewable energy. It’s actual quite amazing the solar industry is so large in the state without these mandates! If they really want to push the solar industry forward, Florida needs to look into adopting mandates like so many other states have. RPSs encourage the solar industry to expand and drive forward, which can lead to lower prices for homeowners as installers become larger, more efficient, and more streamlined.

The state of Florida has setup some great policies to encourage homeowners to go solar in the state. These policies ensure a quick installation process as well as fantastic net metering rates. Remember though that policy is just one part of the equation. Read on to learn about solar incentives in Florida.

Thankfully, in 2008 the state of Florida passed interconnection rules that make it easy for homeowners to apply for and receive interconnection approval. The state created a three tiered system, based on the size of the installation, with each tier having its own interconnection rules:

  • Tier 1: Solar Installations under 10 kilowatts. Unless your installation is extremely large, most homeowners fall into this category. The application process is straightforward – homeowners aren’t required to pay application fees and no study is needed to assess the impact the installation will have on the electrical grid (large scale solar installations typically require this assessment).
  • Tier 2: Installations between 10 kW and 1 MW. Homeowners installing large systems on their roof will likely fall into this tier. As a safety precaution, the state requires installations larger than 10 KW to have an external safety disconnect installed along with the rest of their installation – a requirement that can be found in other states as well.
  • Tier 3: Systems over 1 MW. These are mainly large-scale commercial installations. Most homeowners don’t have the need or space for an installation this large.

All installations must be inspected by the city or county for safety – an extremely common requirement across the country.

These tiers only apply to investor-owned utilities like FPL and Duke-Progress. The law does require municipal utilities and electric cooperatives to offer standardized net metering and interconnection, but doesn’t explicitly address how these organizations should go about this process. No matter your utility, if you’re looking to go solar in Florida, the interconnection process should be easy, simple, and relatively fast.

#4 Financial Incentives, Rebates, and Tax Credits 

Florida has some excellent policies to encourage the growth of solar, including streamlined interconnection processes as well as guaranteed net metering incentives for customers of investor-owned utilities like FPL.

Unfortunately, all those great steps forward are weighed down by the state’s serious lack of financial incentives for solar. While Florida does offer a sales tax exemption and property tax exclusion for roof top solar, the state doesn’t offer any rebates themselves nor do they mandate utilities to offer them, as in other solar-friendly states like California and Oregon.

If you’re looking to go solar in Florida, you’ll have to eke out as much savings as possible, though with the 30% federal tax credit that’s not too hard.

Federal Tax Credit

All homeowners across the country who install solar are eligible for the federal residential renewable energy tax credit. This tax credit is equal to 30% of the total installation cost and goes to the owner of the installation (so if a homeowner leases the installation or finances through a power-purchase agreement, the credit goes to the installer-though they usually pass these savings on indirectly through a decrease in homeowners’ monthly bills). Originally the tax credit was supposed to phase out at the end of 2016, but lawmakers extended the credit to the end of 2019, which then decreases to 26% until 2021, and 22% until 2022.

Unlike tax deductions, tax credits are a dollar-for-dollar reduction, so in essence homeowners who purchase their installation through cash or loan enjoy a 30% discount on their installation! Homeowners apply for the credit when you fill out your next tax return.

Florida Solar Rebates (or lack thereof)

Seeing the importance of encouraging growth in solar, many states mandate that utilities, or at least investor-owned utilities (as opposed to municipal utilities or cooperatives) must offer some form of financial rebate to homeowners going solar.

For example Energy Trust of Oregon, the state-wide organization that provides rebates for renewables and energy efficiency, offers up to $0.60 per watt to residential customers of local investor-owned utilities (the organization is funded through fees on customers’ bills of local investor-owned utilities).

Through Energize Connecticut, an organization similar to Energy Trust of Oregon, Connecticut homeowners going solar can receive rebates equal to $0.40 to $0.51 per watt for going solar.

These incentives add up to a lot of savings for homeowners. Even at $0.40/watt –the lower end of the spectrum- a homeowner installing an average-sized 5 kilowatt system knocks $2000 of her total installation cost!

For all those homeowners in Florida though, you’re unfortunately not so lucky. There’s currently no state-wide solar rebate program. In fact, there’s only one solar rebate program in all of Florida! This goes to the City of Longwood, which provides rebates for a variety of efficiency and renewable energy upgrades to homeowners. Through the Raising Energy Efficiency Program, the city provides 10% of the project cost, up to $500.

That’s a fraction of the rebates in other solar-friendly states, but we still give mad props to the City of Longwood for being a shining beacon in an otherwise dark state (at least in regards to solar rebates). And as a bonus, homeowners can apply for this rebate once a year, so if you want to install efficiency upgrades after your solar (or vice-versa), go for it!

Sales Tax Exemption for Florida Solar

One thing Florida has done right in regards to solar incentives is the sales tax exemption, which allows homeowners to save hundreds of dollars at the outset of the installation.

Passed in 1997 as a three-year financial incentive, legislatures made the bill permanent in 2005. The exemption is for the hardware and equipment for the solar installation (so labor costs aren’t exempt), including the solar panels and inverter, but also the mounting hardware, electrical conduit, wiring, and even the nuts and bolts. In the future, as solar with storage becomes more common, solar batteries are also exempt from the purchase! The state publishes a list of installation components that are sales tax exempt as well as a form that homeowners can show their installer to document the exemption.

The state typically charges a 6% sales tax, so you can see big savings when you take advantage of this incentive! According to the National Renewable Energy Lab’s 2016 benchmark of costs in the solar industry, in an average-sized installation of 5.6kW the cost of the solar panels, inverter, and hardware equal about $1.25 per watt, totaling $7000. So, in this example, the sales tax exemption would save homeowners $420! (6% of $7000)

Property Tax Exclusion for Florida Solar

In the same vein as the sales tax exemption, the state also provides a property tax exclusion for 100% of the added value a solar, wind, or geothermal installation brings to the property. As an example, if your home is worth $140,000 and you install a $20,000 solar system on your roof, your property tax is still only based on $140,000, not the total $160,000 value of your property.

Compared to the sales tax exemption, this is a relatively new incentive, with the state legislature only passing the bill in 2013. The value of this tax exclusion obviously depends on the size of your installation as well as the market value of your home, but stands to save homeowners quite a bit of money.

Even with Florida’s poor record in regards to solar incentives, homeowners can still knock thousands of dollars off the initial price of the installation by taking advantage of all the federal and state tax credits, exemptions, and exclusions.

Consensus

Going solar in Florida is a smart choice to save money and contribute to a healthier environment, but you need to make sound decisions towards financing to ensure you see the financial savings you expect. Choose your financing wisely and take advantage of every tax incentive you’re eligible for! If you do that, you’ll be sitting pretty with a beautiful solar system that helps both the planet and your wallet!

Photo Credit: Flickr via CC License

What are the Best Solar Companies in California?

best-solar-companies-california

The Golden state is a fantastic place for going solar power – but how do you choose among best solar companies in California?

With such a high popularity, it should be no surprise that there are hundreds of solar installers in the state, all vying for your business. Whilst this means you’re spoilt for choice, it also means it can be hard to pick someone out of the crowd. We’ve taken a look at the available options, to try and help you find the best solar panel companies in California.

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The Basics of Off-Grid Solar

off-grid-solar-cabin

Have you ever considered the freedom and independence of off-grid solar?

Many homeowners see going off-grid with no connection to the utility and the ability to power your own life, as quite romantic.

But what does it really take to go off grid? What does an off-grid solar installation really look like? For most homeowners who are already comfortably connected to their utility and have reliable, fairly cheap electricity, what would the sense be in going off-grid?Continue reading

Everything You Need to Know About Solar Monitoring

solar-monitoring

Solar monitoring: the metrics dashboard for your panels.

For anyone interested in installing a new solar system, or if you already have one in place, there are likely still some questions about how your system will perform once it’s actually up and working.  You might not have heard of solar monitoring before, but it will help you answer questions like:

  • How much energy is being produced?
  • How does rain or snow affect my production?
  • How much energy do my various appliances use?
  • How will I know if something has gone wrong?

Because solar power is a huge investment it is important to make sure that you are getting a good return on this investment. Many people are also interested in how solar power works and to see exactly how their system is performing.

Let’s check out some of the main advantages you’ll have by adding solar monitoring to your home system:

Advantages of Solar Monitoring:

Advantage #1: Having Live Data

It’s possible that a small monitoring panel came with your system by default, but the most basic systems do not provide the best data.  One great feature of an advanced system is that you’ll often have access to live data about your performance.  This means that instead of seeing updates every 10, 15, or 30 minutes you’ll see updates every few seconds.

Once you’re able to see these frequent updates, you’ll be able to clearly see how things affect your system by looking at shade during the day, turning off appliances, and seeing the real-time effects of rain and snowfall.

More frequent data also smooths out your data reports and means that the analysis will be more meaningful because it will have access to many more data points.

Advantage #2: Knowing Expected vs. Actual Solar Production

When you are picking out your solar panel system it will likely have some amount of expected solar production attached to it.  Your installer will use averages from your area or actual sunlight readings along with your system size to determine how much energy it should be producing on an average day.  The number that they arrive at is extremely important because it will determine how much you will be saving with your system on a monthly and yearly basis.

Depending on how you structured your contract, your system’s production may even be guaranteed.  In this situation, it would be extremely important for you to know exactly what your system is producing to make sure you’re getting your money’s worth!

Advantage #3: Increase in Performance and Efficiency

If you have access to the complete details of your solar system then you will be able to see ways to improve your performance. Say, for instance, that you see a couple of the panels on the left side of your roof are starting to produce less power during certain parts of the day.

You could use this real-time data to check and see what the cause might be. Perhaps some tree limbs are starting to grow over your roof. Maybe they are getting dirty for some specific reason. Either way, a monitoring system will allow you to capture these performance increases in your system.

Advantage #4: Optimize your Energy Use

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With any solar system, your production will be highest during the times of day in which the sun is brightest and aiming directly at your panels. It is during this time that you’ll want to time any high-consumption activities, such as pool pumps or recharging an electric vehicle, to coincide with your peak energy production. On the other side of the coin, you’ll be able to see when your production is lowest and try to avoid high-energy activities during that time of day.

Advantage #5: Resolve Troubleshooting and Alerts

Troubleshoot

Most systems come with advanced troubleshooting and diagnostics features. These will show you when a piece of equipment has failed, possibly avoiding a long period of time with lost production. Something as simple as a pest chewing through your wires could take ages to diagnose and locate without some type of solar monitoring software.

Which Features Differentiate Your Options?

As we begin to look at different options in the solar monitoring space, we’ll see that there is a huge amount of variation in what exactly each company is offering. Some systems want to maximize the amount of customizability while others want to offer the simplest process possible and everything in between.  Here are a few ways in which your solar monitoring systems could vary:

  • Measuring Interval – Your system could update every 15 minutes or every few seconds.
  • Communication Methods – Your system could communicate via WiFi or you might have to manually upload data.
  • Type of Inverter – If each panel has its own micro inverter then you will often be able to diagnose individual panels.  One central inverter might not allow this.
  • Cost – Some systems have a one-time install cost, others have a monthly, some have both!
  • Ease of Use – Does your system offer a portable monitoring solution like a phone app?  How difficult is it to use?

Most Popular Solar Monitoring Companies

There are lots of companies in the solar industry that offer some type of monitoring service. These services are either built into their own hardware, offered as an add-on piece of hardware, or simply plug into existing systems to provide information. Because of the wide-ranging differences between the systems, they all offer something a little different in terms of features, pricing, and convenience.

Let’s take a look at some of the most popular options for solar monitoring companies:

1#: SolarEdge Monitoring

solaredge-monitoring

SolarEdge has been around since 2006 and was founded and incorporated in Delaware,  going public in 2015. They exist primarily as a secondary equipment provider for solar panel systems by selling power optimizers and inverters. Their SolarEdge PV Monitoring Platform is built into their hardware and it is offered along with the others as a complete package. This would allow you to take solar panels from other companies and couple it with the unique features of the SolarEdge system.

  • SolarEdge Power Optimizer – These power optimizers are either installed onto each PV module or embedded by module manufacturers, replacing the traditional solar junction box. These allow for increased energy output and allows for monitoring the performance of each module. Using these power optimizers allows the customer to have the flexibility and features of a micro inverter without the added costs.
  • SolarEdge PV Inverter – This inverter is specifically designed to work with their own optimizers. By using these components together, the inverter is simpler, more cost-effective, and more reliable than a traditional setup. It has a standard 12-year warranty (extendable to 20-25 years) and has a weighted efficiency rating of >97%.

#2: SolarEdge PV Monitoring System

solar-monitoring

This company has put a lot of effort into creating an optimized, all-in-one type of solution for your monitoring needs. Just keep in mind that you will need to be using their other equipment to effectively use their monitoring system. Let’s take a look at the major feature set:

Pros

  • Enables a top-down, visual map view of your panel installation
  • Shows real-time performance data for individual modules and for the whole system
  • Allows for historical and aggregated data, analysis, diagnostics, and guided root-cause fault analysis
  • Alerts user by email when a fault is detected along with troubleshooting advice
  • Remote service capabilities
  • High-resolution data from up to 12 months prior with visualization options
  • Service is free for 25 years when you purchase a system

Cons

  • Requires use of multiple SolarEdge Products to work
  • Requires an optimizer for each module in your system

Take a look at a home owner’s experience and review with a SolarEdge system:

#3: Enphase MyEnlighten

enphase-myenlighten

Enphase has been around since 2006 and has proven to be a major player in the solar energy space. In 2008 they actually introduced the world’s first microinverter system and since that time the technology has been an integral part of their total energy strategy. They go one step farther than SolarEdge by seeking to offer a complete, all-in-one package that includes everything you need to create an efficient and tightly monitored system for your home.

Their hardware solution consists of Enphase microinverters that will connect to each solar panel in the system. All of those modules will then connect to an Enphase Envoy – basically, the hub used to combine the data from each panel and feed it to the monitoring system and the Enphase AC Battery. From that point, you can access system data from your home or over their cloud-based software called MyEnlighten. Let’s take a look at MyEnlighten’s feature set:

Pros

  • Real-time monitoring of data and system performance
  • Automatic emails of any event that affects system performance.  You can view maintenance issues on graphs or a map of your system.
  • Secure, backed-up online data storage
  • Compare actual system performance against the modeled data to see how your system is producing
  • Share data across social media
  • View historical weather data along with analysis of how it affects performance
  • Today’s performance at-a-glance

Cons

  • Requires multiple pieces of equipment from Enphase
  • Requires a microinverter on each panel

If you are looking for a complete, easy-to-use system that allows for great mobile access to advanced monitoring features, Enphase’s MyEnlighten looks like it could be a good option.

Below is a video of an Enphase customer going through the software and experience:

#4: Locus Energy

locus-energy

As opposed to the two companies we’ve looked at so far, Locus Energy doesn’t produce its own proprietary inverters, batteries, or optimizers. Instead, they produce a piece of equipment that can tie-in to a variety of other installations and provide data on their output. The main drawback to sourcing data in this way is that there is no way to monitor performance from individual modules from their products alone. Their solution is meant to provide general data on your system and doesn’t dig too deeply into the finer details. Let’s look at a few features:

Pros

  • Modular interface allows you to hook their product into a wide range of preexisting installations or plan it as part of your future build
  • Current and historical data
  • Reporting tools
  • Net metering data shows you how much power you are adding to the grid vs. drawing from it
  • On-site data storage with backup and offline access
  • Neat visualization of environmental benefits such as gasoline offset or homes powered

Cons

  • Can’t see data from individual strings or modules
  • No troubleshooting information or alerts about problems with your system
  • Limited ability to diagnose performance issues or optimize efficiency

Here’s a video of the software in action:

#5: AlsoEnergy

alsoenergy

Founded in 2007, AlsoEnergy is another company that focuses on providing a tie-in solution to either previously installed systems or to compliment a new build. They developed their own software, PowerTrack, and then added DECK Monitoring to their product line after acquiring the company that created it in 2013. This allows for both an option between advanced-level and an essentials-only software for your installation. Here’s what both options offer:

  • Revenue-grade Reporting
  • Production values and status indicators
  • Compare actual production against benchmark values
  • Automated alerts for device status and system performance

In addition to this, their individual options offer:

AlsoEnergy Option 1: PowerTrack

  • Has data points for lots of factors including performance models, shading, panel tilts, seasonal variation, etc
  • Workflow Suite for installers and operators that need access to multi-site monitoring and maintenance planning
  • Personalized string maps
  • Apps for iPhone, iPad, and Android

AlsoEnergy Option 2: DECK Monitoring

  • Intuitive tools and navigation to simplify routine tasks. Emphasis is on user-friendliness around alarms, analytics, and reporting
  • Great front-facing PR tool for public displays

Pros

  • Works with a variety of other equipment providers
  • Different levels of software for different levels of needs
  • App support on a variety of devices

Cons

  • No module-level data from individual panels

Conclusion

After looking at some of the most popular options, it’s easy to see how much variation there is in the solar monitoring market. Your final choice will depend on exactly what it is you’re looking to get out of your system, but we think that SolarEdge takes the win here for their overall feature set and convenience. Although there will be more equipment to get up and running, having access to all of the information that their system provides could be worth it to many buyers, enabling your system to perform at its expected level.

With SolarEdge, you’ll get a complete system to couple with the solar panels of your choice and you won’t have to worry about assembling a hodge-podge of different options. You’ll get access to live, visual data, historical analysis, troubleshooting alerts and diagnostics, and much more.

SolarEdge looks to be a great option for anyone looking into maximizing their solar panel system.

Photo Credits:

Images courtesy of SolarEdge; Enphase; Locus; AlsoEnergy.

The Basics of Solar Panel Installation

Solar panel installation

What you can expect to during the solar panel installation process.

The Site Evaluation

When you’ve committed to getting a solar panel installation, the very first thing your installer will do is perform a detailed site evaluation. Solar panels are not a one-size-fits-all solution – there are many factors that needs to be taken into account when designing a solar system to make sure it meets your needs. The evaluation is intended to answer these questions:

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