Prices on home solar panels are falling rapidly due to increased competition and investments towards the industry. Installing home solar panels can take the ease off on your energy bills if you do research before installing them.
Solar panels are everywhere, and it’s no surprise. It doesn’t matter who you are, or what you believe as far as climate change and environmentalism goes. If harnessing energy from the sun, while saving money on your energy bill doesn’t appeal to you then you are definitely in the minority.
The growth in solar panels has been driven mostly by the average homeowner because it saves money, and sometimes it adds value to your home when you’re looking to sell. The average consumer is even willing to pay over $15,000 for a rooftop solar panel.
The most common size for residential homes is the six-kilowatt solar panel system, which runs between $16,260 and $21,420 according to the EnergySage energy marketplace. This does not include the generous tax credits that the government offers when purchasing these panels.
Just about a decade ago the average residential photovoltaic system would cost more than $50,000 on average. The price has now plummeted more than 60% over the past decade, which has made it easier for the average person to have solar panels on their residential property.
Despite prices falling rapidly, there are still questions that you should ask yourself before investing in them because there is a chance that the system is not right for your home. The cost may not be worth it, even though the majority of the time it does save money.
Energy bills range depending on the state that you live in because some states have it worse than others. For example, Massachusetts residents pay 21 cents per kilowatt-hour, which is 70% more than the national average. The average Kentuckian pays less than 10 cents per Kilowatt which 20% below.
For the average Masschusettian, the cost for a $21,000 residential solar system would recoup after a decade, while in Kentucky it would take about 20 years to reach the upfront cost.
According to the executive vice president of the Solar Energy Industries Association Tom Kimbis, “It’s all about how much your cost is, how much you’re paying versus the grid.”
Another factor that might prohibit you from purchasing solar panels is the weather in your area. The amount of sunlight in your state/county/city/town is going to be affected by how much money the solar panel can save you. If you live in Alaska, for example, the solar panel is not going to be as useful as the person who lives in Phoenix, Arizona.
As far as solar panels go, it’s pretty obvious that a lot of the financial positives all depend on where you live. Federal tax credits worth 30% of the purchase cost goes to homeowners who buy their panels instead of leasing. So, during tax season the return on a $20,000 home solar system will give you 30% of your money back. According to TurboTax, your taxable income must be greater than the 30% credit amount to receive the full benefits.
Some states offer more tax credits and deductions that add on to the amount you receive back. If you’re curious about what your state offers then check out dsireua.org, a database run by the NC Clean Energy Technology Center at North Carolina State University.
Research into what kind of tax credits are in your area, and the energy advantages you will receive whenever you purchase a solar panel.