Did you know that solar energy helps offset over 70 million metric tons of carbon dioxide each year? It’s no surprise that solar panels are good for the environment. But many people may be understandably hesitant about the financial considerations. There are a lot of talks about how solar panels can pay for themselves in the long run.
So how much of that is true? Are solar panels worth the investment? If you want to know the answer to this question and more, then you’re in the right place. We’ll be covering everything you need to know about investing in solar panels. Let’s get started!
Factors That Determine the Cost-Effectiveness of Solar
Before we go into the nitty-gritty math, it’s important to first go over some of the factors that can influence the effectiveness of your solar panels. Many of these factors are heavily dependent on your specific location. However, they also depend on how much money you’re willing to invest in your system. Let’s take a look at them.
1) Your Local Electricity Rate
The first factor that affects the cost-effectiveness of solar is the electricity rates around where you live. The average rate in the country is 13 cents per kilowatt-hour.
If you think you’re paying too much for your electricity, then you have a lot to gain from purchasing dependable solar panels. The higher your bill is, the more you stand to save when you switch over. The only curveball is that often prices from an electric utility company will fluctuate. As such, you can expect the savings to fluctuate as well.
2) The Cost and Strength of Your System
One of the most important considerations is how strong you want your system. Do you want to be fully reliant on solar energy? If so you will need to calculate your household’s energy needs in watts, then install a system big enough to exceed it. Most people invest in a medium-sized system, while still relying on the electric company during high-energy usage months.
Many individuals think they can save money by purchasing cheap panels for a smaller system. However, this has two problems. First, the cheap panels won’t last as long, so you will likely need to replace them after a few years. Second, a small system will only slightly offset your power bill. As such, it will take a long time before you see any savings from them.
You also need to consider installation costs. Ideally, you’ll go with a contractor that includes free installation and design with the price of the solar panels. If you live in a state with a lot of solar energy, like North Carolina, then it shouldn’t be too hard to find reliable solar installers. However, in states without a lot of adequate suppliers, it will require more research to find a good one.
3) The Amount of Sunlight That Reaches Your House
Many people think that they can only invest in solar panel systems if they live in year-round sunny locations like Arizona or California. While it’s true that sun level does influence effectiveness, it’s not the deciding factor.
There are more solar panels on the east coast than on the west coast. This is due to the high electricity costs in certain areas, which leads to greater tax incentives to switch over. However, areas with lots of rain, like Washington, will need to rely on a hybrid of solar panels and electricity. The most important thing you need to think about is the location of the panels.
Factors like shade can greatly influence the effectiveness of your system. Make sure to discuss this with a contractor. You want an area on your roof or property that receives uninterrupted sunlight throughout the day.
4) Tax Incentives in Your State
Many states provide incentives for individuals who switch over to a cleaner source of energy. These incentives usually come in the form of claims. These types of claims can greatly reduce the amount of money you need to pay come tax season.
In some cases, you can even eliminate the amount of money you owe in taxes. Make sure you check out the specific tax benefits that are available in your state before deciding.
Are Solar Panels Worth the Investment?
There’s a way you can find out whether or not solar panels are worth it for your home. However, you will need to do a little math. The first thing you need to do is calculate how much your electric utilities will last over twenty-five years. You can do this by multiplying the amount you spend on electricity each year by twenty-five years.
For example, you might pay $40,000 on electricity over twenty-five years. Keep this figure handy. Next, you will need to calculate the cost and installation of installing a system. Make sure you also factor any potential tax incentives you’re getting into this price. Once you have a figure, say $15,000, for the installation costs you can find the return on investment.
This amount tells you how much money you will save on electric bills over the next twenty-five years. Simply subtract your twenty-five-year accumulated electric bill from the cost of installing the solar system. In our example, you would save $25,000 over twenty-five years. Talk about savings!
Did You Enjoy This Article? Keep Exploring to Find More You’ll Love
Do we hope this article helped you answer the question, Are solar panels worth the investment? There’s no denying that smaller power bills and tax incentives are great perks. But you still shouldn’t expect your electricity bill to go away overnight.
Solar panels are a long time investment. As such, it will take a while before you reap the full benefit of their installment. Did you enjoy this article? If you want more like it, then you’re in the right place. Keep reading to find more topics that interest you.