Is Solar a Good Investment?
More people than ever are having solar panels installed on their home. And one of the most common questions they ask at the beginning of the process is, “Is Solar a Good Investment?”
Historically, to answer that question the financial benefits of solar have been focused on the “payback” period of the system. Payback is how long it takes for your energy savings to pay back the cost of the system. While helpful to understand how the cost of the system relates to direct utility savings, the payback analysis leaves out a huge portion of the benefits of solar, financial and otherwise.
Read on for five of the financial benefits of going solar.
1. Savings on your electric bill.
A solar system will immediately provide electricity and savings on your utility electric bill. Even in the winter months, your solar system will be able to produce some energy to help offset the electricity used. This production is now yours and will continue indefinitely—solar systems have a proven lifespan of 40-plus years, and regularly have 30-year warranties.
2. Avoiding price increases for utility power.
Owning your electricity production also helps hedge against rising utility costs for electricity. Nationwide, utilities increased their prices (on average) 2.8% between 2016 and 2018. The US Energy Information Administration forecasts that utility rates will rise between 33% and 83% over the first 25 years of a solar system’s life. A solar system not only protects you from those rate increases, it gives you the control over your electricity costs – allowing for more accurate financial planning, smarter energy consumption, and a greater accumulation of savings.
3. Homes with solar are more attractive to buyers and sell for more than an identical home without solar.
Homes with solar enjoy a “solar premium” when it comes to resale price — as well as a shorter time on market. Homes with solar are able to charge up to $4 per watt of solar installed or $20,000 for every $1,000 per year reduction of electricity costs. These homes also sold 17% faster when compared to their non-solar counterparts.
4. Solar is a guaranteed investment.
Your solar investment is not subject to market fluctuations, making it one of the most secure investments available. Over time, because they are dependent on limited resources, utility prices will only continue to rise. This increases the value of your electrical production, increasing your returns over time!
5. The federal income tax credit.
Thanks to the Federal Investment Tax Credit you can get 30% of the cost of your solar installation in tax credits for 2022 through 2032. In 2033 the credit lowers to 26%, then to 22% for 2034 after which it ends.
Long story short – YES going solar is a great investment! And the sooner you get started the sooner you reap the many benefits solar has to offer.