Grid tied 5kv solar system hassles

Sods law strikes again, we were with Meridian but on the advice of the installers of the system we changed to Contact, it now transpires they expect a bill for exported power, at 17.28c plus GST which they pay into your account, now when you are retired this brings up all the hassles of GST and IRD to contend with,[!] which was a thing of the past. I understand Meridian just read the import and export meters and credit you with the difference, a much simpler solution.

Just wondered how other people went on with their grid tied systems, am I just making a mountain out of a mole hill.

Hi Wandering Free,

I am not your accountant (or anyone's accountant ), but unless your annual turnover for "taxable activies" is above the $60k threshold, you do not have to be registered for GST: www.ird.govt.nz/gst/gst-registering/register-who/

If you are not GST registered, you simply bill Contact for 17.28c/kwhr. They pay you 17.28c/unit (and no GST because you are not registered).

You need to declare this income to IRD (tax return), and pay income tax on any "profit" (profit = income - expenditure) that you make as a result of it. They might let you make "expense" deductions against this income, eg depreciation on the PV array and inverter, the cost of any maintenance, etc.

It would be a really good idea to have a chat with an accountant about this...

Cheers

spark;472602 wrote: Hi Wandering Free,

I am not your accountant (or anyone's accountant ), but unless your annual turnover for "taxable activies" is above the $60k threshold, you do not have to be registered for GST: www.ird.govt.nz/gst/gst-registering/register-who/

If you are not GST registered, you simply bill Contact for 17.28c/kwhr. They pay you 17.28c/unit (and no GST because you are not registered).

You need to declare this income to IRD (tax return), and pay income tax on any "profit" (profit = income - expenditure) that you make as a result of it. They might let you make "expense" deductions against this income, eg depreciation on the PV array and inverter, the cost of any maintenance, etc.

It would be a really good idea to have a chat with an accountant about this...

Cheers

Thanks spark,

After paying $17000 for the system I hope I can write of some depreciation, if it becomes a problem I might switch back to Meridian, but Contact do give a good discount of 22% on their bills if you set up direct bank payments, so being payed for exported power as a separate transaction might be more profitable.

When I did typewriter repairs from home and made out IRD tax returns they always finished owing me, but I would rather not have the hassle even if it was costing me some rebate.

Cheers Bryan

17.28 + GST because you are not registered.

If you ARE registered then you DON'T claim gst.

Sent from my GT-I9300 using Tapatalk 2

Aquila;472635 wrote: 17.28 + GST because you are not registered.

If you ARE registered then you DON'T claim gst.

Sent from my GT-I9300 using Tapatalk 2

I think registration for GST only applies if your turnover is $60000 per year, not something that is very likely, so will just bill them the 17.28,

This is what the say on their email to me,

Our offer to you is 17.285 cents per kilowatt hour (kWh) excl. GST for any electricity that you export to us. This is our distributed generation rate for less than 10 kilowatt peak (kWp). We reserve the right to change this rate at anytime but will only do so after providing you with 1 months notice.

What is Contact's rate for your imported useage?

We also have a grid tied PV installation. Our 5.2kW generated about 7,500kWh in the last 12 months and we are with Meridian.

We considered going to Contact back in April when Meridian dropped their rates but the hassle of billing them didn't appeal and instead we have modified our useage with the aim of consuming as much of our own generation as possible. We only do washing, dishwasher and other such 'voluntary' useage during daytime (and preferably sunny) hours.

This has seen us using 20 - 35% (summer - winter respectively) of our own generation. Meridian pay full rate (28.75c/kWh) for the first 150kWh/month which is about 25% of our average monthly generation, and as we use about another 25% ourselves we are effectively getting full rates for half of our generation.

The rest of our generation only returns 11.50c/kWh but we are looking towards updating our car next year to a plug in hybrid which should see us 'mopping up' another 300kWh/month by charging during the daytime plus we plan to draw off of the vehicle battery for house use at night. The cost of other storage methods for 'excess' generation is out of the question at current prices.

The savings there will also include reduced petrol useage to the tune of $3,000/annum by our estimates but of course there is the outlay for a new vehicle. As we are overdue for a vehicle upgrade anyway, and I suspect the current plateau in petrol prices is set to head skyward again I think the future will prove the wisdom of our move....

Organix;472664 wrote: What is Contact's rate for your imported useage?

We also have a grid tied PV installation. Our 5.2kW generated about 7,500kWh in the last 12 months and we are with Meridian.

We considered going to Contact back in April when Meridian dropped their rates but the hassle of billing them didn't appeal and instead we have modified our useage with the aim of consuming as much of our own generation as possible. We only do washing, dishwasher and other such 'voluntary' useage during daytime (and preferably sunny) hours.

This has seen us using 20 - 35% (summer - winter respectively) of our own generation. Meridian pay full rate (28.75c/kWh) for the first 150kWh/month which is about 25% of our average monthly generation, and as we use about another 25% ourselves we are effectively getting full rates for half of our generation.

The rest of our generation only returns 11.50c/kWh but we are looking towards updating our car next year to a plug in hybrid which should see us 'mopping up' another 300kWh/month by charging during the daytime plus we plan to draw off of the vehicle battery for house use at night. The cost of other storage methods for 'excess' generation is out of the question at current prices.

The savings there will also include reduced petrol useage to the tune of $3,000/annum by our estimates but of course there is the outlay for a new vehicle. As we are overdue for a vehicle upgrade anyway, and I suspect the current plateau in petrol prices is set to head skyward again I think the future will prove the wisdom of our move....

Hi Organix
Interesting statistics on Meridian.
Contact charge:-
Anytime (Low User) 29.897c plus gst
Economy (Low User) 24.080c plus gst
but then give 22% discount on direct debit, our latest bill had a $43 discount so will stay with Contact and see how it pans out. would be interesting to compare in a few months and see how we both are tracking.

We went even further than a hybrid car and bought a couple of battery assist bikes, but Joan fell of 3 times and is now going to have to have an ex-ray tomorrow on her foot, so seems we are back to the car, at least it is economical and gives us about 40 miles per gallon, (doesn't mean much to me in kilometers per liter).

I was thinking of putting timers on things so they only switch on in daytime, the electrician said some people put all their power through one meter so don't have separate water heating, they forfeit the lower tariff but then no ripple controller switching the power of in the day.

Contact's rates sound similar to Meridian's though I think Meridian only give a 10% prompt payment discount. We haven't had a bill that required paying since about this time last year and then accumulated $600 credit before the rate change in April. Now Meridian seem to have forgotten about us as we haven't had a meter reading since mid-May :confused:

We got rid of our controlled metering of the hot water when we had a solar hot water system installed as we didn't want that variable complicating things. TV is on a nighttime only timer otherwise we switch appliances manually as needed.

The vehicle we are looking at is a Mitsi Outlander PHEV due in NZ early 2014. The Outlander has 3 operating modes including a battery use only mode which should cover all but out of province trips so petrol consumption will be negligable, and hopefully nil most weeks. I suspect we're still going to be struggling to make good use (i.e. not exporting @ 11.50c/kWh) of the 800-900kWh/month we generate in the summer months though

Organix;472664 wrote:

We also have a grid tied PV installation. Our 5.2kW generated about 7,500kWh in the last 12 months and we are with Meridian.

Hi Organix,

7500kWh is better than I expect, what is the orientation of your panels, our house isn't positioned right and is L shaped, half the panels are facing the morning and half the panels the afternoon it uses a Enasolar inverter with two inputs for each half of the system, the installers said it should still be around 6500kWh, we just need the weather to improve to see how it performs.

Cheers

We have our installation ground based in the chook & duck paddock next to our house. The house is a 45 degree gabled roof running close to N-S and nowhere near enough roof area for 24 panels. Ground based allows for perfect north facing (with 37 degree tilt) and also makes keeping them clean a breeze. It is worth noting that even a relatively small percentage of shading will result in a disproportionately large drop in generation so keeping debris and dust off of the panels is very important.

Our panels are BP3215B's so 215W (x24) which is 5.16kW on paper but I've seen them peak at over 6kW under optimum conditions (i.e. cold and bright). Inverter is a SMA 6000 which is capable of handling up to 6.35kW DC input. We originally had a 5kW Ginlong but upgraded due to it 'clipping' our output.

The all up cost of our installation is substantially more than yours WF but we were still returning ~8% ROI prior to Meridian cutting their rates. Your lower investment cost should be showing a good return even with less than perfect conditions.

Hi all, I don't want to hijack the thread, but the opportunity to jump in was too good to miss as we're starting to contemplate this, but know nothing! would someone please provide a link/links to assist with comprehension of the basics of solar generation: equipment, costs, expected performance, regulation... as they apply in NZ. Thank you

wandering free;472654 wrote: I think registration for GST only applies if your turnover is $60000 per year,

I believe that is income not turnover, not the same thing.

Del;472734 wrote: Hi all, I don't want to hijack the thread, but the opportunity to jump in was too good to miss as we're starting to contemplate this, but know nothing! would someone please provide a link/links to assist with comprehension of the basics of solar generation: equipment, costs, expected performance, regulation... as they apply in NZ. Thank you

Hi Del,

Don't worry about hijacking the thread the more we talk about it the more we all learn,

The cost is falling all the time so you are better getting some quotes and talking face to face with the people involved, in the end we got a firm who specialize in solar who just happen to have their head office down the road in Richmond, "Solar Energy Technology" I've never seen people work so hard, they never even stopped for lunch, they arrived at 8.00 and were finished by 4.30. and all the paper work was done by them except the forms for connection to the the supply but they supplied all that information I just had to fill in the blanks, it was no problem, it just took about 6 weeks for Contact Energy to fit the import export meter.

The panels we have are JC250M-24/Bb 250w polycrystalline, we have 20 of them, they are guaranteed for 25 years though a separate insurer at no extra cost to us, that's so there are no problems if the manufacturer goes out of business, but there again so could the insurer.

The total cost was $17000 all up, the last time I'd looked into PV it was more like $30000 so costs have come down a lot in just a few years.

I understand that a grid tied system must immediately stop generating when there is a power failure. I appreciate the safety aspect of this for electricity being fed back through the lines, but is there a set up under which power can continue to be used on site, even in a limited capacity, but blocked from entering the grid? We have power outages here, and one of the big attractions of solar is being able to have water come through taps, and have freezers continue to do their thing during the day.

Del;472913 wrote: I understand that a grid tied system must immediately stop generating when there is a power failure. I appreciate the safety aspect of this for electricity being fed back through the lines, but is there a set up under which power can continue to be used on site, even in a limited capacity, but blocked from entering the grid? We have power outages here, and one of the big attractions of solar is being able to have water come through taps, and have freezers continue to do their thing during the day.

As far as I know it's not possible, the voltages on ours can be over 300vdc at 17amps.

You would have to be off grid and then the panels would be connected in parallel not in series and voltages would be 12vdc or 24vdc, not over 300vdc, at least that is what I thought, someone will be able to correct me if I've got it wrong.

A way you could do it is to use a battery charger and have some large batteries with a 12v to 240v inverter just to give you a power socket for emergencies, it could be on a timer and only charge during the day, at least some of the power would be coming off the panels in a round about way. but not a very good solution if the power is out for more than a few hours, I wondered about getting a solar water pump for emergency use that runs of 12vdc and having a couple of panels at least then your not dealing with killer voltages.