The Table below shows default SAM results for a residential PV system in Seattle comparing up front payment to a standard and tax deductible mortgage loan. The modeled system is 4.32kW, made in WA, with an installed cost of $23,544 which is $5.45/W. Performance is computed with the PVWatts option with a total derating factor of .77. Loans are for 100% of the debt at 4.5% for 15 years. The analysis period is 25 years. Inflation is 3%/year, Real Discount Rate is 5%/year, Tax bracket is 28%. Incentives include the 30% Federal ITC and a Made in WA $.54/kWh production credit for 7 years. The PSE utility rate is tiered at $.08494 for < 600kWh and $.10351 above that, with a 5%/year escalation rate and a $7.49 basic monthly charge.
Notice in the table that the payback period is the same for each case, 6.4 years. Most of the other values are also equivalent with the notable exception of LCOE with is much better with a loan and better yet with a mortgage loan. Also the NPV increases with a loan, again more so with a mortgage loan.
Below this table are charts of the Cash Flow and Cumulative Cash Flow for each case. Initial payback comes from the ITC and production credits, along with a steady stream of energy value from net metering.
The last chart shows just the energy value, from net metering. This increases from $356 in year 1 to $2000/month in year 25 due to inflation and utility rate escalation.
The next chart shows Cash Flows
The next chart shows Cumulative Cash Flows