Path-Q Solar
Is a smaller system financially better when a larger system would export more electricity?
Answer
Often, but not always. A smaller system may have better returns when exported electricity is worth less than electricity used on-site, but a larger system can be preferable if export value is strong, future consumption is expected to rise, or the incremental cost is low. Compare the marginal cost and marginal value of each additional portion of the system.
Key points
- Separate on-site consumption from exported production in the financial model.
- Evaluate the additional cost, production, and bill value of each size option.
- Consider future electric vehicles, heat pumps, batteries, occupancy changes, and load growth.
- Include fixed costs that may make a somewhat larger system economical.
What it depends on
- Export compensation and billing structure
- Hourly consumption and production overlap
- Incremental equipment and installation cost
- Expected future electricity use
Risks and trade-offs
- A smaller system can miss future load growth and require a costly expansion.
- A larger system can tie up capital in low-value exports.
- Storage may change the value of additional generation but adds cost and replacement considerations.
Information you may need
- Detailed annual or interval consumption
- Production estimates for multiple sizes
- Export and rate assumptions
- Future load plans and storage options
Your next step
What to do next
Request at least three system-size scenarios showing incremental cost, on-site use, exports, annual bill impact, and payback.
Path-Q
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