- PNC is proud to support "Business Forward" where community leaders discuss the issues confronting business in Central Illinois.

(bright music) (bright music) - Welcome to "Business Forward".

I'm your host, Matt George.

Joining me tonight, Ben McElroy.

Ben is the owner of New Horizon Solar Solutions.

Welcome, Ben.

- Good morning, Matt.

- Well, let's start off with you.

Did I hear you grew up here in Central Illinois, is that correct?

- Yes, sir.

- Where'd you grow up?

- So I grew up North Peoria.

I went to Dunlap School District K through 12.

- All right.

What'd you do there?

You play any sports or anything?

- So I played one year of football and I ran track and cross country.

- Gotcha.

And then you went to college in Bloomington, Illinois State.

You're a Redbird?

- Yes, sir.

- Well today's topic I find pretty interesting.

People think they know what solar is, and maybe I guess we all do to a certain extent.

But let me start off and read the mission of your company.

Horizon Solar was founded to empower every homeowner and business.

Our mission is to help people reduce their expenses, own their power, I want to talk about that, and take their first steps toward energy independence and saving the planet.

But I almost feel like, Ben, that I know enough to not know anything.

Does that make sense?

- Yeah, absolutely.

That makes sense.

- So why is solar such a hot topic right now, especially here in Illinois?

- Yeah, so Illinois passed some legislation to incentivize homeowners to go renewable.

Illinois set in motion a plan to decommission the coal plants and go 25% renewable by 2025.

And their goal is to become 100% renewable by 2050.

And so they've started the process.

- Yeah, say that again.

To decommission coal.

So that means there's no coal in Illinois after by 2025?

I did not know that.

So is this all over or is this just here in Illinois?

Because obviously being here I hear about it a lot, but it just seems like there's such a spotlight on the state of Illinois and some of the solar initiatives and so on, talk to me about that.

- So Illinois is not the only state doing a renewable push, but they are one of the frontrunners.

The current government is very renewable-minded, which is a blessing for our industry.

But other states like California, Virginia, Hawaii are all on the same track to do 25% by 2025 and 100% by 2050.

- Wow, 100%.

I guess, does regulation, if regulation is actually set in place through all those years, which I'm guessing is probably going to be hard, but if it is, what you're saying here is in the next 25, 27 years, you're looking at every business and house potentially being solar.

- Yes, whether on the actual physical property or powered by solar fields, wind farms, hydroelectric dams.

There are other options, but those are the bigger ones.

- So let's just get very basic here.

So the panels themselves, you see them all the time.

They collect sunlight.

So couple of questions here.

It's really cloudy here a lot in Illinois.

So does that actually affect, someone asked me that, does that actually affect the collection of energy?

- Yes.

So depending on the intensity of the clouds, it actually boosts the efficiency similar to how like sometimes you can reflect light through a water bottle and kind of make almost a magnifying lens effect.

Obviously super thick cloud coverage or rainy days is a different conversation.

But on just partially cloudy days, it can be beneficial, but it's not necessarily needing direct sunlight like it would've 20 years ago.

Now it can use indirect sunlight, just UV rays.

The technology's progressed significantly.

- I gotcha.

So back to the sun goes into the panel, then how is it stored?

Is that the right term?

- So you can do backup battery storage.

The majority of homeowners and businesses are not doing that.

What the utility companies have done to try and help homeowners hit this 25% by 2025, they've implemented a program where you can backfeed energy from the system to the electrical grid.

And so any power that your system produces, if it's not consumed by the home or business at that time, goes back into the grid and basically they get a credit on their bill.

- So your process is dream it, build it, enjoy it, right?

So I call you, I say I've got a house, you tell whether it is doable because sometimes it's not doable.

Is that correct?

- 100%.

100%.

- And what would be the reason for that?

- Tree coverage is a big one that if your house is surrounded by trees on all sides, that's gonna be a really clear indication right out the gate, the pitch of your roof and the orientation of it.

If you only have northeast roof space that's not covered by trees, you shouldn't go solar, your house is not gonna be able to produce enough power to make it viable.

- This isn't even one of my questions, but I was just thinking just now after you said something.

So with all these electric cars out there, is there still an opportunity to collect the solar energy, and let's say I had a Tesla, and then be able to use that energy for a Tesla?

Or an electric car or whatever?

- There are even certain EV car chargers that can hook up directly to the panels and it's DC straight from the panel, straight to the vehicle to charge it.

So essentially you get significantly faster charging during day hours, which is kind of cool.

- That is cool.

So if I had an electric car and it's sitting in my garage and it's there in the morning and I have it hooked up right, the solar energy would charge my car and it really wouldn't cost me much of anything, would it?

- Yeah, correct.

Any power that your system produces directly offsets your consumption from the grid.

And so, well we can get into it, but net metering, essentially, if you consume 1,000 kilowatt hours of power, your bill would be, I don't know, $150.

If your solar system produces 1,000 kilowatts during that month, your bill to the utility company is $10, which is just that meter charging customer charge.

So if your system produces more power than you consume, you're basically offsetting your electric costs regardless of how much power you're pulling.

- Okay.

I guess this is a topic that I knew a lot less about than I thought.

- And that's okay, absolutely.

- So let me ask you this.

So just like in construction, contractors right now are struggling with getting materials, some of it's loosening up some, lumber being one that's getting a little better.

But are panels and materials hard to get because of supply chain issues?

- The panels not as much as battery storage.

Battery storage just requires a significantly higher amount of a lot of those precious metal alloys that are getting slightly more difficult to find.

The panels themselves, there's just such a backlog of production that we're not feeling those constrictions.

The big issue that we're finding now is as more and more families, farms, businesses go solar, the amount of people that are qualified to install them are getting strained.

And so there's a big influx of people in training, but there's not enough people to meet the demand.

And so we're actually experiencing significant backlogs.

- What's significant mean?

- Just our typical timeline would be probably 90 days from someone saying "hey, we want to do this" to permits getting installed, getting them turned on.

Now you're seeing 60 days added to that process.

- All right.

So I'm not sure if this is a myth or not, but I've heard storing energy is expensive.

Is that true?

- Definitely.

Battery storage is expensive.

I'm straight up with that 100%.

- So you talked about not all homes qualify, and I'm talking about whether it's trees or in the right location with the roof or whatever, that I understand, but do all homes in Illinois qualify if that wasn't the case?

- Yeah, I mean, so any house can choose to put up solar panels and/or battery storage.

What we're seeing in certain states is some homes that don't have solar at all are getting paid to have batteries installed to basically store power.

Because as more and more states are adopting solar, solar's awesome, but there are limitations because it's not producing power in the evening or at night.

And so if you're able to produce all this power, you need a place to keep it.

And so now the states like California have battery specific subsidies to help cover the cost of batteries, and they'll even pay people to say "hey, install this in your house so we don't have to do it ourselves".

- So this is an obvious, I think this is an obvious answer.

If you're in Arizona where it's sunny 360 days a year, you're pretty much getting a lot more energy there than you are in Midwest.

- Correct.

It's about 30% larger solar systems in the Midwest as opposed to sunnier states like Arizona, Colorado, California.

- So let's talk about the process for a minute.

So if I get hold of you, say I'm interested, you actually, your company helps not only with getting it installed, all that and everything, but you help with the permits because I think that's one thing like for me I'd be nervous of.

I don't know how to do any of that stuff.

That's what you do.

- Yep.

We cover every step of the process for you.

We do permits on your behalf, the installation, the interconnection with the utility company.

- Do utility companies want you to have solar?

- Most of them aren't very happy because they're essentially losing your business because if your solar system produces sufficient energy, you're not paying the utility company other than that meter charge.

However, the legislation requires that each utility company have a certain percentage of its homeowners have renewable energy.

And so it's kind of one of those things where they begrudgingly allow you to do it.

- Now I usually don't get into politics here, but is this a political issue?

So if we have a different President, let's say, and a different party, they could come in and change some of the regulations and that would affect your business?

- It's possible that that happens.

We're actually not really, it's not a partisan issue.

The last three administrations at the federal level have all supported solar.

The previous president extended the solar tax credits.

And it was just extended again this past year.

And so this is definitely on the minds of all parties.

- So it's not just homes, it's also you could do this with businesses, you could do it.

And so I ran a nonprofit for many years and you get that power bill, we had 11 different locations.

You get 11 different power bills.

You could do this at a nonprofit too, is that correct?

- Correct.

Under the current and the newest form of the law, even nonprofits, churches can qualify for some of the tax credits even though they don't pay federal income tax.

- [Matt] And what if you had a farm?

- Farms get to claim all state, federal, and local incentives and accelerated depreciation all in one year if they want.

Farmers actually are the primary demographic of a lot of this legislation.

It is incredibly beneficial for farmers and business owners.

- That is good to know.

So you mentioned the term net metering.

What does that mean?

- So net metering is the colloquial term for what the utility companies allow your farm, business, nonprofit to do, which is to plug your solar system into the electrical grid.

And any power that you produce that's not being consumed flows back into the grid and somebody else can use it.

Essentially your meter on your house, business is constantly ticking forward measuring your power consumption.

What net metering does is spin it backwards and so at the end of the month, there's how much did you produce?

How much did you consume?

You pay the difference or nothing if you overproduced.

- Interesting.

So now what are energy certificates?

- So energy certificates or renewable energy certificates in this case are essentially, you can purchase renewable energy as opposed to coal or nuclear-powered energy and you can purchase those in blocks, energy certificates.

Typically it's 1,000 kilowatt hours as a certificate.

And those are actually traded and bought on commodities markets similar to stocks, other things.

- I did not know that.

And obviously we're talking, there's a lot of tax credits involved with this.

You mentioned the farmers, but also just to be clear to our viewers, you're also talking as a homeowner, there are different tax credits too.

- Yep.

- Okay.

Tell me if these positives of solar are true.

So solar power has the potential to help us minimize our use of fossil fuels and the impact we have on the environment.

So that's the coal piece that we're talking about, correct?

It obviously reduces the electric bill, but what other costs are involved with not only just with the installation , and maybe those are covered by tax credits and so on, but long term, what does that look like for me?

- So the goal with solar is to replace your electric bill.

And if we're able to fully offset your electric consumption from the grid, you no longer owe Amrin, Corn Belt, Con Edison, anything for the power you're consuming whether you choose to pay cash, take out a loan, however it looks for you, you're always gonna have a utility bill at some point.

Once you own the solar system, you have a fixed cost that will then go away.

And so it's always gonna work out long term to own your power than to just essentially rent it from the utility company.

- So when people say off the grid, is that what that means?

- So net metering is not off the grid.

Off the grid means that your house is independent from the utility company.

There's no direct access to their power grid.

You would need battery storage and to formally disconnect in order to be off the grid.

Typically people picture off the grid and they think of like a shack out in the woods with solar panels and some batteries.

Very few customers opt to do that.

- You know, I was doing a little research and I found something pretty interesting, and because I wouldn't have guessed this, and maybe it's just owning a house, maybe it's the sentiment of that or something, but solar panels increase home values.

I would've thought that it wouldn't increase home values by just the look of some of these.

- Yeah, it's definitely an ongoing debate.

If you look it up online, you'll see stories on both sides of that.

We're seeing typically somewhere in the ballpark of two to 3% of the home's value added.

As the utility rates increase, the value of solar being attached to the property increases with it.

Essentially if your house is 150, $200,000 and the house next door has solar, but it doesn't have an electric bill, how much is this house paying monthly when you buy this house versus the house that does not?

What does that translate to the owner?

- So if I was looking at it as like I want to go solar, I'm investing some of my time and money into this.

And I plan on being in my house long term, is there a break even on something like this?

- Definitely, it varies state by state because of those incentives, but in Illinois you can very quickly, I think it's under five years to recoup the total cost of the system.

- That's amazing.

So what about maintenance on these things?

That's something I was thinking about, that it may sound a little crazy, but if something goes wrong, you just don't call the power company and come out and fix it.

What do you do?

- So absolutely, it's a great question.

Any certified electrician can come out and service the system.

It's definitely a stationary technology.

There's not a lot of moving parts and pieces.

There's really only three things that can fail, the solar panel, the optimizer, or the inverter, and all of those can be replaced or maintenanced very quickly.

- I'm just asking a ton of questions, but I think it's just a topic that a lot of people have asked about.

And so talk to me about keeping the panels clean.

I'm guessing that has to be somewhat important.

- It is very important.

We're both blessed and cursed in Illinois that we have four very distinct seasons.

In states like Arizona, Colorado, California, it's just sunny most of the year.

They don't get a ton of rainfall.

In Illinois, we get rain, we get snow, we get everything.

Farming season, especially the harvest season the panels are gonna get very dusty just because that's the time of year, but we get enough rain and snow that it's not very common that you need to go up and spray them off, clean them off, anything like that.

- So back to this net metering, because I was just thinking about something, and I was wondering.

So it's the process, it allows consumers to sell excess electricity from their panels back to the utility company, correct?` But the utility company doesn't want you to have solar, so how can you sell it back to them?

- So partially because each one of these utility companies has to show that they're meeting the 25% by 2025 for renewable energy.

That they're essentially saying hey, if you go solar we're gonna count that towards our base of 25% for 2025.

They're not paying you for the overproduction, it's a credit on your bill.

So that's one big distinction.

Everyone's like "I wanna sell my power back to the grid".

Net metering is one kilowatt hour produced to one kilowatt hour offset.

If you were to sell your power, they'd pay you 3 cents per kilowatt.

But right now with all the taxes, fees, delivery charges, generation charges, you're paying 15 cents.

So it's not a great rate of exchange to actually sell it.

Net metering is equal, but no money changes hands.

- I was just thinking of something, this may sound silly, but you could use solar to, you know, right now electric bikes are hot.

We're going into summer into the boating season.

I'm guessing you can use it for anything that you can plug in?

That's crazy.

So I think everybody griped this last winter about their power bills going up so high.

And so there is an argument here, and I think it's an interesting debate here.

I don't think anybody's questioning the power of solar so to speak in terms of the benefits to the, I guess to the world and to the community.

But I'm just trying to think of the downfalls and I really can't think of too many of them.

So I know that you're not in the business to talk about the downfalls, but what would make someone choose not to go solar?

- If you're not gonna be in the home for two or three years, it's probably not worth your time to make that investment.

From a large scale, from a state or just utility scale, solar is fantastic, but it doesn't generate power in the evenings or at night.

And at some point the panels do see a decline in their productivity.

Most panels are 25, 30 year warranties at this point, and that's to be 90% as good as they were when they were installed.

But this is not a forever technology.

100 years from now, all of these panels will have to be replaced, updated, maintenanced.

So there is a date to it, but it's much better than what we've currently got going on.

- And I guess if you think about it, panels are no different than anything else.

You've gotta dispose of them somehow, correct?

- Yes sir.

- So when you're talking about technology, technology has grown leaps and bounds year after year forever.

So I'm guessing solar panels are no different than three years or are probably probably a lot better, I guess I should say, than three years and five years ago.

Is that correct?

- To an extent, yes.

What we've really seen in our industry is a plateau of the cost to efficiency of the product.

There's this range where the majority of all products are within.

And to go anywhere outside of that, it's kind of like looking at a Corvette and a Ferrari.

A Corvette costs a third as much as a Ferrari and it's a little bit slower, but if you want to pay significantly more for that slightly higher performance, you buy the Ferrari.

Does that make sense?

It's diminishing returns based on the cost of the product.

- Yeah, I just had Patrick Kirchhofer on, he's the director of the Farm Bureau here, and we were talking about wind farms and the positives and negatives of wind farms.

So let's go back to farming for a second because we have a lot of people that watch this show that are farmers.

So if you had solar, does that compliment the wind turbines or do they... Are they the same thing?

Tell me the difference between the two.

Obviously I know visually what they are.

- So solar can compliment wind farms.

Wind farms have the capacity to generate a stupendous amount of power.

The problem with wind farms is there's moving pieces.

If something goes wrong, it can be incredibly time consuming to fix.

If one of those blades breaks or the motors fails, it's a large technical issue and it requires massive components, expertise.

And if it's not windy, they're not producing power.

And the cost of a wind farm is very, very expensive.

Solar is much less capital intensive right out the gate for most applications.

- Well this has been a real education and I appreciate, Ben, you coming on.

I'll tell you what, I could probably ask another half hour worth of questions but appreciate you having on, Ben McElroy, owner of New Horizon Solar Solutions.

Thank you so much.

My name's Matt George and this is another episode of "Business Forward".

(bright music) (bright music continues) (bright music continues) (bright music continues) (bright music continues) (bright music continues) - Thank you for tuning in to "Business Forward" brought to you by PNC.

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