So, how do you go about figuring out how much a solar panel will cost? The cost of solar panel systems is often misunderstood when people consider it as a potential source of energy. Or even, for that matter, do we instinctively understand the link between the price of solar power and its worth. In the United States, gas prices are expressed in dollars per gallon. Additionally, we all know how far we’ll be able to go on a tank of gas that costs $40. Instead of being depleted in a matter of minutes like a tank of gas, the value of a solar panel is released over time instead.
That said, we’re here to answer two questions: (1) What are the prices for solar panels? Do solar panels have a return on investment that is greater than the price of installing them?
To begin, let’s take a look at how much solar panels will set you back. It’s common for solar photovoltaic panels, which convert sunlight into electricity, to be sold in dollars per watt ($/W). Generally speaking, there are a number of factors that come into play here. DC watts vs AC watts may come up in conversation from time to time. Additional terms may include dollars per watt peak ($/Wp) or dollars per kilowatt hour. Remember that when you acquire a solar energy system, not only do you get the capacity or “potential” to generate power right now, but you also get the ability to do so in the future. Wow, that was a lot of fun!
As a result, how much money are you going to have to shell out? How much does a solar photovoltaic (PV) system cost up front?
Considering that each solar home installation is slightly unique, the end outcome varies slightly. In addition, the price varies from region to region due to the fact that solar rebates and tax credits are typically offered at the state and/or local level. It is important to know that all US taxpayers with federal income tax liability are eligible for a 30% federal solar energy tax credit. Solar energy costs can be found in the following resources:
NREL’s Open PV Project has collected pricing information from solar installations across the US. The average cost of solar PV in 2010 was $7.15 per watt in the United States. This program doesn’t include all solar installation companies, thus the stats aren’t exact. In any case, the data shows how much an Arizona homeowner might pay ($5.64/W) in comparison to the $7.64/W spent by the average New Jersey household.
For example, several jurisdictions require that solar installers declare their installation costs, and authorities may withhold subsidies if this information is missing. As a result, we have access to a wealth of information about the price of solar panels. Residential solar energy projects with a median system capacity of 8 kilowatts receive an average rebate rate of $5.32/W from Pennsylvania’s Sunshine Solar Rebate Program, for example (kW). There are currently quarterly updates on domestic solar pricing from the California Energy Commission and the California Public Utilities Commission, which are averaging $7.19 per watt, according to Go Solar California.
(3) Use a rule of thumb if you’re unsure. Use $7.00/W for domestic solar projects if you’re calculating the cost of solar panels. This is a decent starting point, even if it isn’t flawless. Remember that this pre-incentive figure might be reduced by any local solar rebates and tax credits.
Get at least two (preferably three) solar home energy pricing quotes from reputable solar installers. Only after receiving a written proposal will you have a firm idea of how much solar panel installation for your home will cost.
As previously said, generalizations are difficult to make due to the fact that each and every project is unique. A typical 5-kW system would cost around $35,000, assuming a pre-incentive cost of $7.00/W ($7.00/W * 5,000 W = $35,000). With any form of rebates or the 30% federal tax credit, this total cost will be significantly lower.
Is the cost of installing solar panels worth it?
This response, like the last one, varies from project to project and location to location. Depending on the state, a solar panel system can pay for itself in just three to five years and provide long-term energy savings in states like New Jersey, Pennsylvania, California, Arizona, Massachusetts Colorado, and Hawaii. If you’re planning a home solar energy project and you want to maximize your return on investment, you should consider the following factors:
In other words, how much you have to spend to get your electricity. Assuming all else is equal, homeowners that pay a high per-kilowatt-hour (kWh) power rate will get the most financial benefit from installing a solar home energy system.
(2) Your local solar energy subsidies. An investment in a solar energy system will not only save you money on your monthly utility bill, but it will also bring in additional income through the sale of solar renewable energy credits (SRECs).
Thirdly, the amount of sunlight or “insolation” in your area. Despite the fact that a large portion of the United States receives enough sunlight to make solar an attractive option, solar energy systems produce more power in areas with greater sunlight.
There is a good chance that adding solar panels to your home will increase its market value. In most cases, adding solar panels raises the resale value of a house while lowering the overall cost of ownership.
A good quote will show you the long-term savings you can expect from a certain system. a cash flow analysis will be included, which will show the expected recovery time and return on investment (ROI).
You, as the property owner, are ultimately responsible for deciding how much money a home energy improvement will save you in the long run. Solar panel systems can provide inflation-protected savings for up to an additional 15 years after a ten-year repayment period, so many individuals are happy with a ten-year repayment plan. Other homeowners may be looking for a return on their investment in less than five years.
Thousands of new solar power plants are routinely reducing homeowners’ electricity costs and providing a positive return on investment. The long-term value of solar panels far outweighs the initial investment. If you’re being honest, however, you’ll come across states where local solar incentives are inadequate and/or electricity costs are low. A few states that come to mind include Kentucky, Alabama, and Nevada. Currently, it’s hard to tell if the value of solar outweighs the costs in these areas. Against the backdrop of a 19-year investment recovery and a low-single-digit return on investment, a Nebraskan can be excused for their anxiety.
The value of a home solar energy system is increasing for practically all property owners across the country as the cost of solar panels decreases every day and more states introduce measures to boost demand for solar power. If you’re fortunate enough to live in a place where the value of solar power already outweighs its cost, don’t miss out on this fantastic chance!