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Are Photovoltaic Systems Right for You?

Before you make the decision to install a full solar energy system in your home, learn more about what a Photovoltaic system is, and whether or not it’s right for your home.

How much can you initially spend?

Solar panels are expensive, and the initial cost is dependent on the size of the system, the location in which you live, and the amount of electricity you use. However, be prepared to spend $25,000, or about $40,000 before incentives and rebates are factored in.

If you weren’t planning on spending more than $10,000 then perhaps a solar hot water system would be more appropriate for your budget. If you use a lot of hot water, and have an oil or gas powered hot water tank, then this option is a great choice. Solar hot water systems can provide most of the hot water in your home, all year round. Residential water systems usually cost between $6,000 and $7,000 to install, and these systems are durable and reliable. What’s more, these systems are also eligible for many state and federal incentives.

Still not within your budget? There are incentives and rebates that make install solar panels and smaller solar systems cost less than $10,000. While these systems aren’t as cost effective or efficient as larger systems, if you’re committed to using solar energy and want to keep costs down, this is an option for your home.

What is your motivation?

Carefully consider the reasoning behind why you want to invest in solar energy. If it’s because you want to do something for the environment while lowering your energy costs, then you’re most likely serious about installing a solar energy system. However, if you saw one system and thought it looked neat, then your money may be best spent elsewhere. Consider the statistic that it will take around 20 years for your solar system to pay for itself. If you’re looking for an investment with a quicker return, invest in energy efficient windows.

How much electricity do you use?

Examine your last energy bill, and figure out the total amount of kilowatt-hours (kWh) you used. Then figure out how much energy you used throughout the entire year. If you spend less than 8-10 cents per kilowatt-hour, then a solar system most likely won’t pay off. Solar systems have the biggest pay off in areas where “on-grid” electricity is more expensive. This is due to the fact that extra solar energy generated is transferred into credit on your energy bill, so the higher the rate, the more those credits are worth. For example, in the state of California, some rates are as high as 49 cents per kWh. The more you spend, the more you save.

What is the condition of your roof?

If you have a south (or west) facing roof that is completely free from shade and is in good condition, you have the ideal roof for solar panel installation. Don’t worry about the angle of your roof, because collector panels are installed at a variety of angles. As a rule of thumb, 100 square feet of roof per kilowatt of system size is required. Confirm the square footage of your roof and direction it faces. Consider tall buildings or trees next to your roof, and at which point during the day your roof is covered in shade. If your roof will need repair in the next 10 years, you may want to wait, or repair it earlier as solar systems (when installed) have a life span of about 20 years. Also remember your roof will not be reinforced in order to secure the panels.

What are your state’s rebates and incentives for installing solar?

Review your state specific financial incentives for solar installation. Typically, these are in the form of tax credits and rebates (sometimes as much as 35% of the system cost). Rebates are usually calculated based on the per watt system size. Net metering is also available in many states, and this allows for any excess power you generate to be credited back o your utility account.

In general, it’s important to consider your realistic budget, specific state incentives, and structure of your home before installing any type of solar energy system. While the return on investment is quite long, there are federal and state incentives that can help lower the initial costs.

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