The simple answer to the most frequently asked question, “Will solar panels really save money?” is yes. How much you’ll save is not a “one size fits all” answer and will depend on several variables. Take into consideration the total number of direct hours of daily sunlight, number of panels and size and angle of roof. Outside of those factors, local electricity rates will also determine how much solar can save you. Guaranteed 20-year savings is 20% minimum, annually, relative to what your current needs are. So, two identical homes side-by-side will likely have a different 20% savings outcome.
The First Step
To get started, peruse your utility bill to calculate how much you are currently spending on electricity every year. For example, the average annual electricity use for a U.S. household is 11,000 kilowatt-hours (kWh). Multiplied by the national average electricity rate ($0.1287 per kWh) and it is discovered that the typical American family is spending nearly $1,400 annually on electricity costs.
Electricity Rates Vary
Next, consider the upward trend of electricity prices and factor future utility rates. When you compare the cost of utility electricity with home solar, keep in mind in the last 10 years, national electricity costs have increased at a rate of 2.2% per year. It is expected that electricity rates will continue a steady climb.
Utility rate volatility creates an added incentive for solar. When you generate your own energy with a rooftop PV solar system, you’re taking control of energy costs and avoiding falling victim to energy cost increases. This enables solar panel owners to better predict and budget their utility fees without breaking the bank.
Invest Once to Save Each Month
The costs of installing solar panels are typically the only up-front investment necessary for a new PV system. Other costs can arise if you incur any added electricity costs if your panels do not completely offset 100% of your electricity use. Worried about installation? With solar leasing, your upfront costs can easily be $0. Leasing removes the sticker shock of equipment and installation cost, however, the savings guarantee stays in place. The provider, who owns the panels, benefits from tax credits, thus lowering the cost of usage that includes constant optimization and maintenance, if any, of the operating system when necessary.
Panels Are Increasingly More A ffordable
A report from the National Renewable Energy Laboratory demonstrates the continued reduction in cost of solar PV systems for homeowners, as well as commercial and utility scale usage. The investment into solar panels is affordable, accessible and a smart way to save on utility costs.
In the report, NREL Senior Analyst and Project Lead Ran Fu shares, “The continuing total cost decline of solar PV systems demonstrates the sustained economic competitiveness of solar PV for the industry across all three sectors.”
“Such accurate cost benchmarks are critical for tracking the progress of PV systems toward cost-reduction goals because our cost model categorizes hardware and non-hardware
costs with a high degree of resolution, the results can also be used to identify specific cost reduction investment opportunities and assess regional levelized costs of energy,” Fu said. As PV solar panels drop in cost, competitiveness among the fast-growing solar industry is resulting in added cost savings to those who choose to adopt PV systems in their home.
Know The Facts
No two PV solar panel systems are designed alike, just as your home compared to any neighbors’ homes are uniquely different. If two homeowners installed the same equipment and received identical financing deals from the same company, geography, usage history and shadows could create differing solar yields.
A Worthy Trend to Follow
Adopting solar energy as a source of energy for your home is a wise choice. Take advantage of state and/or federal tax incentives, and also reap the long-term cost savings of installing a PV system in your home. Understanding the benefits of solar energy is the first step to making a greener choice that not only helps the environment, but saves you more money.