The cost of solar energy for your home can be a daunting prospect. But with the right information, you can make an informed decision about whether solar energy is right for you. The national average price of a 6 kilowatt (kW) solar energy system is about 10.55 cents per kilowatt-hour. This is before considering potential tax incentives and refunds.
But what does all of that really mean? Let's break it down into what solar energy could cost your home. The amount of energy used by your home will determine the amount of solar panels you'll need to install to offset your energy costs. Homeowners can look at their electricity bills to calculate their average daily energy consumption and compare it to the number of panels that would be needed to generate all of their energy needs. The amount of sun exposure your home receives can affect the amount of energy solar panels absorb and, in turn, the amount of money you can absorb from your existing electricity bills. Where a homeowner lives can affect the local installation rate, as well as the number of incentives and rebates available in the area. Compared to other home improvement projects, solar panels are a relatively high-cost project.
But, in turn, they can increase the market rate of a home and, eventually, offset electricity bills. In general, solar panels begin to pay for themselves in small increments during the first year. Homeowners can expect broader amortization compensation between five and 15 years, depending on the configuration and where you live. Homeowners use solar energy in different capacities in all 50 states, but some inevitably perform better than others. That's why where you live can be a critical factor in deciding if your home is a good candidate for solar energy.
To start calculating your own costs, see our table below. Find the square footage closest to your home and see the range of panels you may need and the cost of those panels. The panel number varies depending on whether you live in a state that is better or worse for solar energy due to the weather and whether or not you want to compensate for all or only a portion of your electricity needs. See “How Many Solar Panels Will You Need?” below for more information. To find out how many solar panels you'll need, you'll want to determine how much electricity your home consumes on a daily basis.
A solar inverter will need to be installed to transform the direct current (DC) power from the panels into the alternating current (AC) that you can use in your home. The average household uses 905 kWh per month, or about 10,850 kWh per year, in electricity. That means an average-sized home with a decent amount of sunlight could install a 5 kW to 6 kW solar panel system to help reduce utility bills. You may want to learn about the sun number score for solar energy, which is calculated based on the location of your home and the average exposure to sunlight. Also, explore the different dimensions and sizes of solar panels with your contractor for more context. On the other side of the coin is the resale value of your home.
A Zillow analysis showed that solar panels can increase the value of a home by up to 4.1 percent. Simply put, if your home can take advantage of net solar metering, solar energy that is abundantly collected and not needed in your home will go through your meter and go on the grid. A digital meter in your home records electricity moving in any direction as you enter the house and when you leave. The “net share” of the term means that the homeowner pays the “net amount” for the electricity used by the home minus the extra sold to the grid. There are several payment options that group solar installation costs into the consumer's electricity bill, either as a solar panel lease option or as a power purchase agreement (PPA).
Solar leases allow the homeowner to install solar panels without paying anything (or much) upfront, reducing the total cost of solar panels. After installing the panels, the landlord pays only a fixed monthly fee. The fee includes installation costs, which are distributed over time, and the cost of supplying electricity. It's worth noting that, in most solar leasing agreements, the solar company generally maintains the incentives associated with owning solar panels. But the consumer gains other advantages.
The solar energy company may offer a monthly charge below the utility rate, or one that doesn't increase like utility rates do. At the end of the contract, homeowners can renovate, purchase the system, or have the equipment removed from their property. If you decide to sell your home, having solar panels leased may work against you as you would have to transfer your lease to a qualified buyer - making sure that they are qualified in order to make an offer on your property. Many potential buyers would prefer not to deal with this extra paperwork which means homes with leased solar panels stay on market longer than those with owned systems. Solar energy may be simple in concept but its application can be disconcerting - what works best for one homeowner may not be best for another. Take time to gather relevant information about home size, local solar insolation levels, existing electricity rates and consumption before deciding if it's worth calculating potential cost savings from installing solar panels at your property. Solar panels can not only power appliances but they can also be installed for other benefits such as heating and cooling homes with solar energy; heating water; and even heating swimming pools with renewable energy sources. Real Homes has its readers' best interests at heart - when you buy through links on our site we may earn an affiliate commission so you know you can trust us! Whether you want to save on monthly bills or secure a future without them - it's worth considering how much do home solar panels cost?.