Will solar panels truly save me money or will the initial set ups costs destroy any chance of coming out ahead?
It’s the question we ALL want to know:-
- Yes- we all know the sun’s energy is “free”
- Yes- we are all sick of paying $200-$500 a month in electric bills to utility companies and being at the whim of random pricing structures
- Yes- saving money and helping the environment sounds great
But Are Solar Panels Going To Save Me Money?
Because without that- let’s just go and talk about something else!
Luckily, over the last 2 decades, solar panels have become WAY more popular as because:
- There have been generous tax incentives to help offset the initial purchase costs. There was a 30% federal tax credit on the total cost of a system. Though, we believe this is being phased out now :(. Congress authorized the subsidies through 2019, but it declined to 26% in 2020 and 22% in 2021 and then it is scheduled to disappear. Here is more information on renewable energy tax credits. (Obviously check for any changes at the time you read this- as things may change).
- The tax credit could save the average homeowner $5,000 or more (depending on the size of the system), according to EnergySage, a solar marketplace with a calculator to help estimate savings.
- Technology continues to improve and is much more efficient at converting more of the sun’s energy into useable energy. A solar panel a few years ago used to only be able to convert approximately 5% of the sun's energy that it captured to useable energy. Now that figure is closer to 55%.
- Solar panels themselves continue to become cheaper over time.
- People continue to be more self-reliant and want to future proof themselves against black outs or cyber hacks on the grid network from a hostile enemy.
How To Get Started Saving Money With Solar Power
To ensure that solar panels save money, it is important to have a basic idea of how a solar system works. Review our previous article on off grid solar systems. This gives you the low down on the basic components of a solar power energy system and gives you an idea on how much power output you are likely to need.
As well as the panels themselves, you will also need an inverter (to convert the DC energy to AC energy that can be used by household appliances) and a batteries to store to excess energy that you can use at any time including when the sun does not shine for a few days.
Excess energy can also be sold back to the grid to help off set any costs.
In fact, some states, like California, now require new homes to install solar panels to create more renewable energy sources.
Will Solar Panels Save Me Money?
Many of our clients approach us to buy land because they want to live “off the grid”. There are different levels of truly "living off the grid”.
Some people still want electric utilities available (so is that really off the grid???)
They set up a hybrid system- where they are still connected to the grid, but they have solar installed and supplement their own energy with the grid energy. So they reduce their monthly electric bill but do not eliminate it.
This is a good way to “test” out your systems and get a good understanding of your usage, learn how the solar systems work and iron out all the potential “issues’ before you go completely off the grid.
However other folk like to buy land in remote areas where they are totally self-sufficient and can supply their own power, water and waste systems.
As with any new system or new skill, there is an inevitable learning curve and initial set ups costs(especially in the first year).
This way of living is becoming increasingly popular and recent events like those in 2020 have accelerated this trend of moving to more rural locations and becoming more self-reliant.
How Much Money Can I Expect To Save By Using Solar Energy?
It depends how many panels you purchase, how much sun your area gets on average each year and how much energy your household uses.
But it is not unusual to go from $300 a month electric bills down to $50 a month or even zero. So yes, solar panels save money for most people in most states.
Over the long term, this can amount to thousands of dollars saved.
From our research, the typical payback time of the standard system is usually around 7-10 years. This may amount to savings of $11K-$27K over 20 years.
If you can find a way of getting solar energy much cheaper (eg DIY solar energy) your savings will be even greater and much quicker!
Hint: keep reading....
Should Everyone Be Using Solar Energy?
We believe that everyone should certainly be investigating a back up energy system of some sort. Whether that be a generator or solar or wind energy or some other method. It is never wise to rely on just one source for something as important as your family's energy systems.
It depends on the amount of sunshine your area gets per year whether solar energy will work for you. (Studies show that approximately 46 states have adequate sunshine to make solar energy well worth the investment!)
The fact is the USA's current energy grid is out-dated!
It is way past its “use by” date.
It desperately needs billions of dollars in overhaul and upgrades in next few years.
And you guessed it.... There is no plan in place to fix it!
Imagine if you had no power for 3 weeks due to a hurricane or tornado?
Most people could not last 1 hour without internet!
But what if there was also no lighting, no heating, no TV, no oven and no hot water?
Life would be very miserable, very quickly!
What if all the goods in your refrigerator and freezer go bad?
What if then your pipes freeze and burst as well?
What about cyber attacks on the nation's grid from a hostile foreign power?
Or it may be a innocent worker who accidentally cuts a cable while doing maintenance....
Don't wait until a crisis occurs before you start to prepare….
We do not wish to be alarmist at all- but everybody knows that at some point, things can and do go wrong from time to time.
Is There A More Affordable Solution To Solar Power?
The average cost of a solar power system for an average house runs at $21,450-$25,000.
That is quite an upfront investment!
Most estimates say that you will get your money back through savings in 7-10 years. If this sounds like the solution for you, get several quotes for companies near you.
Or we have also come across a DIY home energy system that may just revolutionize the solar industry.
It allows you to create your own off grid system at home and cheaply!
This method completely eliminates the need to buy overpriced (retail) solar panels and hire expensive installation companies.
(Yes this is an affiliate link which means if you do purchase anything through it, we may generate a small fee which helps the running of the website at no extra cost to you. But either way, we just knew this was too valuable to keep to ourselves!)