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Solar energy is the energy from the sun. The sun shines on earth and the energy is transmitted to earth through sunlight, it converts to heat or other energy forms on our planet.

Photovoltaics represents direct conversion of sunlight into electricity. First used in about 1890, the word has two parts: photo, derived from the Greek word for light, and volt, relating to electricity pioneer Alessandro Volta. So, photovoltaics could literally be translated as light-electricity. And that's what photovoltaic (PV) materials and devices do — they convert light energy into electrical energy (Photoelectric Effect), as French physicist Edmond Becquerel discovered as early as 1839.

Solar Thermal represents the conversion of solar rays into heat energy that can be used in a variety of ways. One common application is for solar hot water at relatively low-temperatures. Another is using concentration to generate high temperatures that are then converted to electricity using steam turbines.

The actual amount of sunlight falling on a specific geographical location is known as insolation—or "incident solar radiation." The following map provides annual average daily total photovoltaic (PV) solar resource, for flat panel tilted south at latitude:

For more information and maps, such as monthly average, or for direct normalized radiation, please check out: http://www.nrel.gov/gis/solar.html

Solar cells are generally flat plates made from silicon or other materials and various conductive materials. They could be of different sizes or shapes, typical silicon solar cells are square. When sunlight strikes a solar cell, the interaction between the photons of light and the receiving material releases electrons which are carried away using a conductive grid, generating electric current. Solar cells are also called photovoltaic cells - or PV cells for short. Many different thin film technologies are also being developed using different processes and having novel characteristics.

Multiple PV cells are arranged together within a PV module and wired together to create a complete panel or module. For large installations, hundreds or thousands of individual modules are installed together along with inverters, electrical wiring, and safety and monitoring systems into an array or complete solar system. Arrays could be ground-mounted, rooftop-mounted or building integrated.

There are two primary types of PV installations. Off-grid systems are used where the cost of a PV system is cheaper than stringing electrical power lines long distances from the local utility. This type of system requires some form or energy storage device such as a deep-cycle battery or conversion of the energy produced into some other form such as heat so that the energy can be recovered later when needed.

Grid-connected PV systems are connected directly to the utility grid, and virtually uses the grid itself as the energy storage and retrieval device. If the PV system provides more power than the home or business uses, additional electricity is fed back into the grid for other people to use. When additional power is needed in the evenings, it it drawn from the grid.

There are many different types of PV cells, panels and arrays that are used and in development. Photovoltaics vary in their basic materials, ability to produce electricity, costs and applicability for specific projects.

The basic panels include: Monocrystalline Silicon Panels, Polycrystalline Silicon Panels, and Thin Film Panels.

Monocrystalline panels use crystalline silicon, a basic semiconductor material. Crystalline silicon is produced in large sheets that can be cut to a specific size and used as one large cell in a panel. Conducting metal strips are laid over the entire cell to collect electrons from the cell into an electrical current. These panels are more expensive to produce than the polycrystalline panels that follow. However, they are highly efficient and are often more cost-effective in the long run as a result. Monocrystalline panels are typically 15-18% efficient, meaning that for every unit of solar energy that hits the cell, the panel can convert 15-18% of this energy into electricity, with a theoretical maximum efficiency possible for first-generation silicon photovoltaic cells at 29%. Current efficiency record of 25% is held by University of New South Wales' ARC Photovoltaic Centre of Excellence.

Polycrystalline, or multicrystalline, photovoltaics use a series of cells in place of the single large cell used in monocrystalline panels. Polycrystalline photovoltaics are a less expensive form of photovoltaics available today, though the costs of producing individual cells can still be high. The drawback of these panels is that they have lower efficiency rates than monocrystalline panels, at typical efficiency of 12-14%.

Thin Film Solar Cells are usually categorized according to the photovoltaic material used. The following categories exist: Cadmium Telluride (CdTe), Copper indium gallium selenide (CIS or CIGS), Dye-sensitized solar cell (DSC), Organic solar cell, Thin-film silicon (TF-Si). There are also solar cells made from III-V materials (typically gallium arsenide), with higher efficiency as well as higher cost.

PV technology still has immense potential to evolve, develop, and advance. Research and development (R&D) in processing, process understanding, and manufacturing has been accelerating globally as adoption of solar systems has increased rapidly. There is much important R&D still to be performed, not just on cells and modules, but also on balance-of-systems components and on system management technology.

PV systems produce no atmospheric emissions or greenhouse gases. Compared to fossil-generated electricity, each kilowatt of PV electricity offsets up to:

16 kilograms of nitrogen oxides

9 kilograms of sulfur oxides

2,300 kilograms of carbon dioxide (CO2)

If the industry grows by the 25% per year as predicted PV in the United States will offset 10 million metric tons of CO2 per year by 2027 — equivalent to the annual increase emitted by U.S. fossil fuel electricity generation. This means that the emission rate will become negative thereafter as the PV contribution grows!

The PV industry is neither "squeaky clean" nor a major environmental, safety, or health problem. When it comes to emissions, PV's electricity-generating portion of the fuel cycle is the clear winner versus fossil fuel sources. However, semiconductor processing can involve the use of chemicals and toxic materials.

Some 80% of the current PV industry is silicon. Basically, it uses the same processing as the semiconductor industry, which is touted as being comparatively clean. It also has the same risk. There are various codes, controls, and regulations in place that oversee PV silicon industry operations, ensuring that it's relatively safe.

PV materials that incorporate heavy metals or toxic materials are continuously scrutinized to ensure safety. To date, the Environmental Protection Agency, Underwriters Laboratories, and others have conducted testing and investigations that indicate no problems. But the programs and companies involved remain vigilant and active in ensuring safety. Industry has made many improvements in multiple areas.

Typically PV panels generate direct current (DC) power, and most utilities use alternating current (AC) power. DC can be converted to AC through an electrical device called inverter and the resulting AC power can be used at any required voltage and frequency with the application of appropriate transformers, switching, and control circuits. PV systems can use either centralized inverters at the system level or micro-inverters which are mounted to each individual panel.

A Power Purchase Agreement (PPA) is a legal contract between an electricity generator and a host site owner or lessor. The host site owner or lessor purchases energy or capacity (power or ancillary services) from the PPA Provider (the electricity generator). Such agreements play a key role in the financing of electricity generating assets. Under the terms of a PPA, the PPA provider (the electricity generator) typically assumes the risks and responsibilities of ownership when it purchases, operates, and maintains the turnkey facility.

The PPA provider secures funding for the project, maintains and monitors the energy production, and sells the electricity to the host at a contractual price for the term of the contract. The term commonly ranges between 5 to 25 years. In some renewable energy contracts, the host has the option to purchase the generating equipment from the PPA provider at the end of the term, may renew the contract with different terms, or can request that the equipment be removed.

By clearly defining the output of the generating assets (such as a solar electric system) and the credit of its associated revenue streams, a PPA can be used by the PPA Provider to raise non-recourse financing from a bank or other financing counterparty.

Commercial PPA providers can enable businesses, schools, governments, and utilities to benefit from predictable, renewable energy. The PPA provider is able to take advantage of the tax benefits available to solar power investors that otherwise would be lost if the purchaser was a non-profit organization or government entity.

In the United States, the solar power purchase agreement (SPPA) depends heavily on the existence of the solar investment tax credit, which was extended for eight years under the Emergency Economic Stabilization Act of 2008. The SPPA relies on financing partners with a tax appetite who can benefit from the federal tax credit. Typically, the investor and the solar services provider create a special purpose entity that owns the solar equipment. The solar services provider finances, designs, installs, monitors, and maintains the project. As a result, solar installations are easier for customers to afford because they do not have to pay upfront costs for equipment and installation. Instead, customers pay only for the electricity the system generates. With the passage of the American Recovery and Reinvestment Act of 2009 (the "ARRA") the solar investment tax credit can be combined with tax exempt financing, significantly reducing the capital required to develop a solar project. Moreover, in certain circumstances the federal government will provide a cash grant in lieu of an investment tax credit where a financing partner with a tax appetite is not available.

Net metering is a special billing arrangement for customers with renewable energy systems, such as solar electricity systems, that permits customers to get credit for the full retail value of the electricity their system generates. Under net energy metering, the customer's electric meter keeps track of how much excess electricity is generated by the renewable energy system and sent back into the electric utility grid, and how much electricity is consumed by the customer.

At any time of the day, a customer's renewable energy system may produce more or less electricity than their home or business needs. When "excess" electricity is produced by the system, it will automatically go through the electric meter into the utility grid to be supplied to other customers. When this occurs the meter runs backwards. At other times of the day, the customer's electric demand may be higher than the renewable energy system is producing, and the customer relies on the additional power needs from the utility. Over a 12 month period, the customer has to pay only for the net amount of electricity they use from their utility over-and-above the amount of electricity generated by their renewable energy system (in addition to monthly customer transmission, distribution, and meter service charges they incur).

However, the rules vary significantly by utility, state and country including the availability of net metering, the applicable rate schedules used, if and how long you can keep your banked credits, and how much the credits are worth (retail/wholesale). Most net metering rules involve monthly rollover of kWh credits, a small monthly connection fee, monthly payment of deficits (i.e. normal electric bill), and annual settlement of any residual credit.

A Feed-in Tariff (FiT, Feed-in Law, FiL, solar premium, Renewable Tariff or renewable energy payment) is an incentive structure to encourage the adoption of renewable energy through government legislation. The regional or national electricity utilities are obligated to buy renewable electricity (electricity generated from renewable sources, such as solar photovoltaics, wind power, biomass, hydropower and geothermal power) at rates set by the government, usually above the current market rates.)

A higher price and long-term stability of prices helps overcome the cost challenges and initial investment requirements for renewable energy sources by creating a demand-side incentive for investors to build new renewable energy production capacity. The rate may differ among various forms of power generation. A FiT is normally phased out once the renewable portfolio reaches a significant market penetration or as the installed costs come down to the point where project economics no longer require this program.

The feed-in tariff system has been enacted in some areas in Australia, Austria, Brazil, Canada, China, Cyprus, the Czech Republic, Denmark, Estonia, France, Germany, Greece, Hungary, Ireland, Israel, Italy, the Republic of Korea, Lithuania, Luxembourg, the Netherlands, Portugal, Singapore, Spain, Sweden, Switzerland, and in some parts of the United States.

In a grid-connected PV system, PV modules, wired together to form a PV array, pass DC electricity through an inverter to convert it into AC power. If the PV system's power output is greater than the owner's needs, the inverter sends the surplus to the utility grid for use by others. The utility provides AC power to the owner at night and during times when the owner's requirements exceed the capability of the PV system.

Using grid-connected PV power can have economic as well as environmental advantages. Where utility power is available, consumers can use a grid-connected PV system to supply some of the power they need and use utility-generated power at night and on very cloudy days. When the PV system supplies power to the grid as well as to a specific building or piece of equipment, the utility becomes a kind of storage device or battery for PV-generated power. Also, electric rates tend to be highest during the peak production times for PV systems which mean that the system owner can essentially sell power back to the utility provider at a high rate and only needs to purchase power when rates are lower.

The net energy payback period for PV panels is improving rapidly. For example, it takes today's typical crystalline silicon module about 2-4 years to generate more energy than went into making the module in the first place. The next generation of silicon modules, which will employ a different grade of silicon and use thinner layers of semiconductor material, will have an energy payback of about 1-2 years. And thin-film modules will soon bring the payback down to one year or less. This means that these modules will produce "free" and clean energy for the remaining 25+ years of their expected life.

Solar has many advantages: Clean & reliable, Available where you need it, Offset peak usage, Proven technology, Cost competitive, Scalable project size, Price stability, Long system lifetime, Mitigate power supply risks, Proactive carbon tax avoidance, Positive brand image, and others. The better question is: "HOW can I use Solar power to improve my organization?"

There are many factors that must be taken into consideration and properly managed: building structure and age, available space for solar panels, electric usage patterns, utility rate structure, financing resources available, incentives, organization type, technology choices, system installers, sustainability goals, etc. Installing PV systems is a big decision for commercial, government and non-profit organizations and can be a multi-million dollar investment. The system will produce energy for at least the next 20-30 years and properly understanding the risks and opportunities is key to a successful project. Having the right partner with comprehensive experience in the solar field is the best way to maximize returns from your solar project.

Given current net metering rules, a customer's solar system should be sized to produce no more than their expected annual electricity needs. Your system size will depend on your needs and how much electricity you want to offset with solar power. You can also build your system by starting small and expanding over time. As long as your total system output is not greater than one megawatt, this modular approach is allowable.

It is important to keep in mind that utility rate structures also determine how much you will save. Electric rates generally increase in tiers as you use more electricity, or if it's based on Time-of-Use (TOU) the rates are higher during day time and summer months, fortunately this is a great fit for solar power which also produces the most at these times. A smaller system that satisfies part of your electric needs may be more cost-effective to you because you will be avoiding the higher tier rates, and/or get more money back from the solar power generated at higher rates during the day. For example, it is possible that a solar system which produces only 50% of your power needs could save you 75% of your utility bill.

Photovoltaic systems are very reliable and the solar panels are warranted by the manufacturer for generally at least 20 years (depending upon the manufacturer). Other major components such as the inverter needs to be replaced when they are about 15 years old, but the schedule is generally known in advance and factored into the project financial analysis. A well maintained system could generate power at nearly 80% of its planned output even after 20 years in service.

Optony is a commercial scale solar research, technology and consulting firm based in Silicon Valley, California. We are actively collaborating with the National Renewable Energy Laboratory (NREL) and the U.S. Department of Energy (DOE) to pioneer next-generation high-efficiency, low-cost solar PV technologies. We are dedicated to leveraging our world-class expertise to provide independent consulting, research and technology to accelerate solar adoption by government, education and commercial organizations.

We work from a position of global knowledge and experience using our advanced processes and techniques. As an independent, objective business and solar technology advisor, we help our clients achieve higher levels of energy output, profitability and sustainability.

Typical clients for Optony include all large commercial industries, local, state and federal government, non-profit organizations, and solar project developers. Optony does not currently provide services for single-family residential projects.

Electricity rates have gone up an average 5-7% per year for the last 30 years, and this trend is likely to continue. Fortunately, the cost of PV modules and related equipment have dropped as new suppliers have entered the market and manufacturing processes have improved. In addition, there are a number of rebates and incentives that are available for projects starting this year or next year which can dramatically reduce investments and increase returns. Depending on your specific situation and needs, yes, this could be a very good time to install a PV system.

There are many federal, state, city and utility sponsored incentives and rebates available for the purchase, installation and production of power from solar systems. An updated database of incentives can be found from DSIRE website: http://www.dsireusa.org

The American Recovery and Reinvestment Act of 2009 (H.R. 1) allows taxpayers eligible for the federal renewable electricity production tax credit (PTC) to take the federal business energy investment tax credit (ITC) or to receive a grant from the U.S. Treasury Department instead of taking the PTC for new installations. The new law also allows taxpayers eligible for the business ITC to receive a grant from the U.S. Treasury Department instead of taking the business ITC for new installations. The Treasury Department issued Notice 2009-52 in June 2009, giving limited guidance on how to take the federal business energy investment tax credit instead of the federal renewable electricity production tax credit. The Treasury Department will issue more extensive guidance when available. For solar projects, the credit is equal to 30% of expenditures (subject to basis calculations), with no maximum credit.

The grant program option applies only to commercial systems and does not apply to residential systems, non-profit organizations or governmental entities.

The owner of new solar equipment put to commercial use and placed in service in 2009 or 2010 qualifies potentially for a 30% cash grant from the US Treasury. The owner would receive this grant in place of the commercial tax credit. The grant should be paid within 60 days after the equipment is placed in service or, if later, after the application is submitted and approved for the grant. Grants will also be paid on commercial solar systems on which the owner commences construction in 2009 or 2010, provided the system is placed in service by 2016.

Unused commercial credits can generally be carried forward and offset against future income for up to 20 years, or until all the credits have been used. Please contact your tax advisor for the latest guidance on how to carry forward unused tax credits.

The cost of all equipment and the labor used to install solar equipment goes into the “basis” for calculating the credit. However, only labor tied to eligible solar equipment goes into the basis. Thus, for example, if part of the labor is for replacing a roof under the solar panels, that part would not count. Please contact your tax advisor for the latest guidance on how to calculate the basis for renewable energy projects.

No, the federal 30% tax credit applies to commercial, for-profit enterprises and does not apply to non-profit organizations or government entities.

Generally, the answer is no, the installation of a PV system cannot cause an increase in personal or business property taxes. In California, this exclusion is written into law.

Estimated savings are based on a number of factors including the size and configuration of your system, the anticipated output based on your location, your current and planned energy usage, and your electric rate schedule. The Optony team can perform an in-depth analysis that takes all of these factors, and more, into considerations and present a detailed spreadsheet that predicts how much you will save on your annual electric bill once your PV system is installed. Actual savings may vary from predicted, depending on your energy usage patterns and weather conditions.

Utilities are not required to purchase any net excess electricity you produce at the end of each 12-month period of your net energy metering agreement. However, in areas where feed-in tariff policies are in place, the PV system owner could receive payments from the utility company depending on the total power generated by the PV system and the power usage, rather than capping the payments to the amount of energy actually used.

With current technology, decreasing costs, better incentives and tax benefits, it is very likely that you will have a positive ROI purely based on the annual utility bill savings from the power generated by the PV system - even before counting the green benefits and increase to the property value. The Optony team can help to independently evaluate multiple scenarios for your specific situation and recommend the best solution with the highest ROI, taking all relevant factors into consideration.

According to a recent study by The Appraisal Journal, for every $1 that you reduce your annual utility bills by improving your energy efficiency, it adds $20 to the value of your real estate property. For example, if you can save $10,000 per year in energy costs, then the real estate property value could increase up to $200,000. In most cases, a PV system will add more value than the net cost (after all rebates and incentives have been taken), so from the first day of production your property value increase has recovered the cost of the system, plus there are ongoing utility bill savings and environmental benefits for the next 20-25 years.