Did you know that solar energy offsets over seventy million metric tons of carbon dioxide every year? Besides the positive environmental impact, residential solar panels can also help you save a lot of money on your monthly energy bills. However, it’s important to remember that the initial installation costs will be a little costly.
If you’re interested in residential solar panels, then you may be wondering whether or not they’re worth the investment for your home. Luckily, we’ve organized this article to help you break down the costs and savings that come with installing a system. That way, you can be sure whether it’s the right decision for your home. Let’s get started!
How Much Do Residential Solar Panels Cost?
Before we go into the costs of residential solar panels, it’s important to decide whether they’re right for you or not. Luckily, we’ve organized this guide to help you decide. If you’re interested, then your next consideration is likely how much a system will set you back. The exact cost of solar panels depends on a variety of factors.
The most important consideration is how big you want your system to be. Some people simply want to offset their traditional electricity bill by a little every month. Others want to rely solely on solar for all of their energy needs. Ultimately, the size of your system will play a big factor in how much the initial investment costs.
However, it will also play a big factor in how much you save each month on bills. In California, the average cost of a solar system is between $12,900 to $17,400, or around $2.91 per Watt of energy. If this sounds like a lot, then don’t panic. There are a variety of ways you can save on these costs.
What is the Average Payback Period For Solar Energy?
A payback period refers to the amount of time it takes for the solar system to pay for itself. It does this through savings in monthly energy costs that would typically go toward your traditional electricity bill. The average payback period takes around seven years. However, ultimately, it depends on how you pay for your system.
The size of it also plays an important factor. However, the payback period isn’t the only amount of savings you’ll receive. In the next section we’ll go over some of the other incentives you can get.
Ways to Save On Your Residential Solar Panels
Many people are initially intimidated by the large price tag attached to most solar systems. However, it’s important to remember that you can cut this cost down through a variety of savings. These savings come in the form of tax incentives, rebates, and financing options. In this section, we’ll take a look at three of the popular ways you can save on solar panels in California.
Federal Tax Credit
The Federal Tax Credit for solar photovoltaics is one of the best ways to save on the final price of your new solar system. So how does it work? Essentially, a percentage of the price you paid for your solar panels will be taken out of your federal income taxes in the form of a tax credit. As of right now, you will be able to claim 26% credit on the price of your system.
So, let’s say you purchase a residential solar panel system for $15,000. 26% of $15,000 is $3,900. So, your final federal income tax would be reduced by $3,900. Talk about savings!
However, it’s important to take advantage of this tax credit before 2021. Why? Because in 2021 the percentage of tax credit will decrease to 22%. While you’ll still save money, it won’t be as much as the 26% incentive available in 2020.
California Solar Rebates
Many cities and counties in California offer what is known as the Home Energy Renovation Opportunity (HERO) Financing Program. This program is offered by the Property Assessed Clean Energy (PACE). It allows homeowners to finance their solar panels and pay them back in the form of property tax.
If you live in Rancho Mirage, then the Rancho Mirage Energy Authority will pay $500 to cover the cost of your permit fee. Finally, you can still take advantage of net metering in California.
This program allows you to take bill credits for any extra solar capacity your home generates that isn’t used. However, this net metering does have a capacity of 5%. This is based on the accumulated customer peak demand for the metering program.
$0 Upfront Leasing
If the expensive price tag is still worrying you, then consider going with a company that offers $0 upfront leasing. When you go with this option, the leasing company technically owns the solar system. Instead of paying in one massive chunk, you pay as you go. This option is ideal for people who want solar but can’t afford the initial investment.
The only downside to this is it will take the longest amount of time to see an ROI (or, return on investment). If the return on investment is really important to you, then your best bet is with an upfront cash purchase.
Need Solar Panels in the Orange County Area? Contact Altair Solar
We hope this article helped you decide whether or not you want to install residential solar panels. Ultimately, if you’re willing to put in the money for a good system, then you’ll eventually see energy savings from it. But how do you find a good solar panel supplier that you can trust?
If you live in the Orange County area, then look no further than Altair Solar. Our engineers, manager, and installers have over thirty years of experience in the solar industry.
As such, we can provide you with a detailed analysis of your home so you get the best system for your needs. On top of that, you get a lifetime of monitoring from us, so you always know if a problem occurs. So what are you waiting for? Contact us today and schedule your free site visit.