WHY ZERO NET-ENERGY WASN’T GOOD ENOUGH FOR MY HOUSE

WHY ZERO NET-ENERGY WASN’T GOOD ENOUGH FOR MY HOUSE

Many zero net-energy advocates make the statement that ‘zero net-energy homes have zero energy costs’.  There is a dirty little secret that made this statement false for THE HAYFIELD HOUSE. Following is my story and the dirty little secret.

The definition of a zero net-energy home is one that produces as much renewal energy as the house uses, as measured on an annual basis. It then sounds logical to jump to the conclusion that such homes have zero operating energy costs. It also sounds logical to assume that if a house is performing at near zero net-energy that your utility bills will also be near zero. — I’ve found both assumptions to be FALSE for THE HAYFIELD HOUSE.

For the design of THE HAYFIELD HOUSE (see house metrics), my ballpark target was to get roughly to zero net-energy without unnecessarily throwing excess money at the design to guarantee the house reached net-zero. My thinking was that my utility bills in my prior (energy inefficient) house ran about $4000 per year. I therefore thought that if I constructed a house that incrementally approached zero net-energy, that my utility bills would also trend toward zero. During 2021, THE HAYFIELD HOUSE used about 6% more energy that it produced. It therefore seemed logical that if my prior house had no solar panels and produced no renewal energy and had annual energy bills of $4000, that my new house’s energy bill should be small, roughly 6% of $4000, or about $240 per year. Instead, my annual energy bill for my highly efficient HAYFIELD HOUSE was $1350. That seemed illogical. — Now for the dirty little secret.

As I reviewed my utility bills, I noticed that I had overlooked the very fine print on how my utility company bills for electricity when connected to a net-meter.  Once I accounted for the actual billing methodology, I realized that to have no energy bills, my house needed to perform significantly better than zero net-energy. Here’s why….

At the end of each month, the utility company reads my net-meter. If my solar panels have produced more electricity than I’ve used for the month, my bill will show a dollar credit. On the other hand, if during the month I use more electricity than my solar panels have produced, I get billed (debited) for the kWh difference, with any previously accumulated dollar credits being used to offset the bill. Here’s the problem. The credits and debits aren’t calculated using the same methodology. For THE HAYFIELD HOUSE, I accumulate credits only on 60% of the surplus kWhs that the solar array produces during a month (i.e. I lose 40% of my credits). In addition, these credits are worth only about $0.21 per kWh. However, if I’m debited, I’m debited on 100% of the kWh used at about $0.28 per kWh. So what happens is during the summer the house uses much less energy than my solar panels produce due to the long, sunny days, with no energy being used to heat the house. During the summer, I’m therefore accumulating credits, but only on 60% of the excess power. Then, during the winter, my house uses much more energy than the solar panels produce due to the short, dark days and a lot of energy being used to heat the house. By mid-December, I’ve blown through all my accumulated credits and begin to get billed at the full retail rate of $0.28 per kWh for the extra electricity needed to operate and heat my house. — In short, since I get a ‘haircut’ in my credits, my house can produce as much energy as it uses on an annual basis but I still face significant electric bills.

This ‘surprise’ billing methodology resulted due to the combination of the nameplate size of my solar array (16.64 kW) and the date of the array’s commissioning, all as per the State of MA net meter regulations. It took me a very deep dive into the regulations to uncover this fact and convince myself I wasn’t being screwed. In my case, this methodology was a shock as most literature suggests that the debits and credits are calculated nearly the same, which tends to be true for solar arrays in MA that are under 10 kW; which mine isn’t. If one does the math, THE HAYFIELD HOUSE would need to produce about 30% more energy than it uses before the annual utility bills would drop to zero. In essence, a net-zero operating cost house (i.e. no energy bills) and a zero net-energy house are not the same thing for THE HAYFIELD HOUSE. Over time, this ‘billing’ problem will get magnified. My solar panels are forecasted to lose about one-half percent efficiency per year. Therefore, as my solar panels age, I will slowly accumulate less kWh credits during the summer and even more quickly blow through my credits as winter approaches. Theoretically, over time, my utility bill will inch ever higher. This suggests that I should have designed THE HAYFIELD HOUSE to be better than zero net-energy.

Another reason to over design a net-zero house is that the energy models can have a large error range in forecasting energy use versus actual energy use. It’s safer to over design than to under design your house in case your energy forecast is wrong, and you get stuck with surprisingly high electric bills (as is what happened to me). It is also a mistake to think you can just fix the problem by adding more solar panels at a later date. There are technical and regulatory reasons that can make adding solar panels at a later date more difficult than installing them initially. For THE HAYFIELD HOUSE, adding more solar panels isn’t an ideal solution as those panels will produce little electricity during the winter when I need the power the most, and any excess power produced during the summer will suffer the 40% ‘haircut’. For most houses, stopping air leaks is the cheapest and most effective way to decrease energy use during the winter. The second most cost effective way is to add insulation. Both of these methods decrease energy use in the critical winter period when you need to minimize the amount of net electricity you are using. Unfortunately, both of these methods are best employed in the building and design phase as it usually is difficult to retrofit later.— For THE HAYFIELD HOUSE I’m trying to inch closer to net zero by adding insulation and making some other modifications that I’ll explain in subsequent posts.

So the moral of this story is:

If you’ve hit the bullseye, before celebrating, make sure you’ve hit the right target.

PS. If in addition to having net metering, you also qualify for solar credits (such as a SREC or SMART credits in Massachusetts), you may disagree with the above analysis and argue that those dollar credits should be factored into the cost analysis of getting to zero annual operating costs. I disagree as then a house could be designed to be very energy inefficient and reach zero operating cost by merely adding a lot of solar panels. — Instead, most people think of the SREC and SMART credits as offsetting their capital costs, not offsetting their annual energy costs.