Solar power panels have dropped dramatically in price since 2008, which has led to a surge of interest from homeowners and small businesses.
But the true cost of solar panels, and whether they’ll help you save money on electricity, depends on a few key factors.
Read on to find out if solar power panels are expensive and worth it in your situation.
Review your electric bill
Before you even consider solar panels, you’ll need to find out how much electricity they will save you. But while there are some general guidelines – like the fact that Phoenix is an excellent city for solar power – each home or business is different.
You can get a fairly accurate estimate of your savings from a site like EnergySage, which offers a free service that helps you find the best installers in your area. The site only covers fixed, not portable solar panels, so be sure to specify that if you are looking at alternatives.
Evaluate your sunlight exposure
Your savings will also depend on how much sun your home gets, or if you are in Arizona, how often it is sunny. The website Solar GIS can help find the angle of your roof and its exposure to the sun, so you can see how many months each year you get more than 4 hours of full sun per day. Ideally, you want to be able to get at least 4 hours of full sun per day.
If you live in a mild climate, you can get away with less. But if you live in a colder state like New York, the average sun exposure needs to be quite high for solar panels to make sense – about 8 hours or more per day year-round. You can also estimate the sun exposure in the summer using this map.
Check out net metering rules in your state
Net metering rules determine how you get paid for any excess energy that solar panels produce, and whether or not it offsets your electricity bill at all. For example, if you produce more than what you use, but the rules aren’t in your favor, you might not get paid at all.
If you’re eligible for net metering and live in a progressive state like California, solar panels can save you thousands of dollars per year.
Check on availability of incentives and loans
Solar power panels can be expensive, depending on where you live, but there are ways to make them more affordable. For example, if you choose a lease option, your installer covers the cost of installation in return for collecting the tax benefits for 20 years.
Incentives and low-interest loans from the government, utilities, or other companies can also help offset your costs. In fact, if you qualify for a solar tax credit, it could be enough to cover the entire cost of installation.
But if you buy panels outright with no incentives, expect about 20% of the full price from a bank or private investor.
Consider the total lifetime cost
The total lifetime cost of solar panels is more important than their upfront price tag. For example, even though they might be expensive to buy, they could save you money in the long run with no electricity bills and a possible tax break. But make sure you consider all your costs, including maintenance and storage.
In most cases, though, solar power panels will never completely offset your electricity costs – they’ll just make them a bit less expensive.
If you want to go completely green, or if solar is already relatively affordable in your state, feel free to use the cost savings value as a positive attribute. But if you want solar power panels to make sense from a purely financial standpoint, be sure to look at your specific situation before you make a decision.
Are solar panels expensive?
It all depends on your circumstances. You’ll need to find out how much electricity they will save you, and whether or not it offsets your electricity bill at all. If the installation costs are too high, there are ways to make them more affordable, including government incentives.
What is net metering?
Net metering rules determine how you get paid for any excess energy that solar panels produce. By law, a utility company must buy back electricity from your panels at the same rate they charge you, and sometimes even above market rates.
In return, if your home uses more electricity than what your solar power system produces, the utility company will still cover all your needs.
What are solar tax credits?
Solar tax credits reduce the amount of taxes you owe every year, dollar for dollar. They’re available to anyone who installs a solar power system on their property, and they can cover up to 30% of your total installation cost.
How are solar panels made?
There are two main types of photovoltaic panels: crystalline silicon, which is more efficient but less durable, and thin-film CdTe, which is more flexible but less efficient. Either way, you can learn about (and even order the raw materials for) how they’re made.
What if I already have a solar power system?
If you already have a solar power system in your home, you might be able to save money and energy by insulating it and re-doing your landscaping in “solar-friendly” ways (such as facing south, avoiding tree shade, etc.).
What are the costs of solar panels?
Solar power panels are free to make, but it can be expensive to buy or lease them. Manufacturing costs vary by region and technology used, whereas installation costs vary depending on factors like size, location, and how many people work on it.
How long do solar panels last?
Solar power panels can last for 30 years or more with no significant impact on performance. It all depends on the quality of the design, installation, and maintenance. But even after they wear out, you can recycle them (and make new solar cells) for 10% to 40% of their initial cost.
Why are solar panels expensive?
Solar power panels can be expensive because they’re still a newer technology and there’s been a limited amount of demand for them in the past. But when more people decide to make the switch, manufacturing costs will come down, making solar energy affordable for everyone.
Is solar energy more expensive than conventional energy?
Generally, solar power is much more affordable than any other kind of energy, though it depends on where you live and how you use it. For example, if you live in the Southwest, diesel fuel can cost up to four times as much as electricity.
The only way to find out if solar power makes sense for you is with a home energy audit. If it does, the next step is to compare your options – DIY, lease, or buy – and make an informed decision.