Going solar is a term gradually becoming mainstream over the years, with the rising popularity in solar panel installation, many households are beginning to consider going solar as an alternative to save costs on utility bills and generate power for their homes. But what is the cost of going solar? How much do you save? Is it a good alternative to consider? In this article, we will be breaking down the cost and worth of going solar?
What will it cost me?
The first thing to know about solar panel installation is the fact that it is a long-term investment which means most of the costs will occur in its initial purchase. Solar panel purchase will cost you between $2,900 and $5,500 depending on the size and quality of the system you go for.
However, this initial cost, as large as it looks is a one-time payment that will ensure that you enjoy your solar panels for at least 25 years and within three to four years you can expect the system to have paid for itself.
But before you think about installing solar panels, there a couple of things you have to consider when choosing the size of your system and who to install.
Firstly monthly utility bills and more importantly the amount of power you use each day on a regular basis. System sizes are indicated by the peak output per hour in KiloWatts. A popular system size for a 3 bedroom home with a family of four is a 5kWh system.
This system will put out around 20kWh over the entire day.
Secondly, you need to look at when you use power. Most use their power at night when the sun is not shining and you are not harvesting power. To get around this you can consider installing a backup battery system.
With the current feed-in tariffs offered by Australian energy suppliers and the upfront cost of battery storage being so expensive, it really isn’t worth it for most people. It is something you will need to look into.
And lastly, you need to look at the installer and the quality of the product they use. There is an endless combination, but only a handful of reputable brands with considering so be sure to do your homework.
Using a FREE service like Go Solar Quotes to help find installers will save you time and money as all installers have been vetted for quality and reputation.
Doing the Math
The greatest advantage to solar panels is its constant rate which doesn’t fluctuate like traditional electricity making it easier to predict and plan accordingly. If you are living in a region where your utility bills are high, going solar could pay you.
Furthermore, federal tax breaks make the purchase and installation of solar panels more affordable. These federal tax breaks can award a taxpayer up to 30% off on their solar panel purchase. This means that a solar installation that costs between $15,000 and $20,000 can be brought down to between $10,000 and $13,000.
Another thing to consider before installing any solar panels in your region would be net metering, which is a system where the excess energy that you generate from your solar panels is sold to the national grid in exchange for credits on your utility bills basically earning money for you as use you generate your own electricity.
Alternatively, if the one-time payment option seems too expensive to you, there is another way of going solar which is through a solar lease. A solar lease works like a traditional car lease, in which a leasing company pays for the installation and maintenance of the solar panels, although the ownership of the solar panels naturally lies with the company. The only thing you have to do as a homeowner is to pay monthly lease payments which give you access to use the solar panels. In most cases, there are no down payments necessary, as once you make your first monthly payment, you get access to use the solar panels. But bear in mind that a solar lease exempts you from the federal tax credit.
In conclusion, solar panel installation can be an initial expensive venture but a worthy investment when properly maintained. An installed solar panel system can save you as much as $1,500 in a year. So, ensure to do your research before concluding on going solar.