Solar panels are built to work in all climates, but in some cases, rooftops may not be suitable for solar systems due to age or tree cover. If there are trees near your home that create excessive shade on your roof, rooftop panels may not be the most ideal option. The size, shape, and slope of your roof are also important factors to consider. Typically, solar panels perform best on south-facing roofs with a slope between 15 and 40 degrees, though other roofs may be suitable too. You should also consider the age of your roof and how long until it will need replacement.
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If a solar professional determines that your roof is not suitable for solar, or you don’t own your home, you can still benefit from solar energy. Community solar allows multiple people to benefit from a single, shared solar array that can be installed on- or off-site. Costs associated with purchasing and installing a solar energy system are divided among all of the participants, who are able to buy into the shared system at a level that best fits their budget. Learn more about community solar.
Those interested in community solar can take advantage of a tool from SETO awardee EnergySage. The company's Community Solar Marketplace aggregates the many available options in one place and standardizes project information, allowing interested consumers to easily locate and compare multiple community solar projects in their area.
The National Renewable Energy Laboratory (NREL) developed a tool called PVWatts for this purpose. It estimates the energy production and cost of energy of grid-connected PV energy systems for any address in the world. It allows homeowners, small building owners, installers, and manufacturers to easily develop estimates of the performance of potential PV installations, and can even compare solar’s cost to utility bills. These tools are great for getting started, but make sure to work with a solar installer for a custom estimate of how much power your solar energy system is likely to generate.
For its analyses, NREL uses an average system size of 7.15 kilowatts direct-current with a 3-11 kilowatt range. According to SETO awardee EnergySage, that’s enough power to meet all the energy needs for an average home in Austin, Texas.
There are a number of mapping services that have been developed by SETO awardees that will help you determine if your roof is suitable for solar and can even provide you with quotes from pre-screened solar providers in your area. In addition to those resources, an internet search can help you find local companies that install solar panels. Because you will likely have many options to choose from, it’s important to thoroughly read reviews of solar companies to make sure you are selecting the best fit for you and your home.
Solar co-ops and Solarize campaigns can also help you start the process of going solar. These programs work by allowing groups of homeowners to work together to collectively negotiate rates, select an installer, and create additional community interest in solar through a limited-time offer to join the campaign. Ultimately, as the number of residents who participate in the program increase, the cost of the installations will decrease.
Most people going solar have a positive experience. But like other fast-growing industries, the rampant expansion of solar energy has opened the door to a small subset of bad actors.
Our Smart Shopping Tips for Solar outlines a few ways to identify red flags as you go solar:
On August 7, , the U.S. Department of the Treasury (Treasury), the Consumer Financial Protection Bureau (CFPB), and the Federal Trade Commission (FTC) issued a consumer advisory to help you identify potential consumer solar scams and file complaints about suspicious behavior. Before you sign any documentation with a solar company, carefully review these educational materials:
Net metering is an arrangement between solar energy system owners and utilities in which the system owners are compensated for any solar power generation that is exported to the electricity grid. The name derives from the s, when the electric meter simply ran backwards when power was being exported, but it is rarely that simple today. Whether or not your solar system qualifies for net metering payments depends on policies and practices in your state and electric utility. Your local electric utility would be a good place to source information on net metering in your service area. When researching net metering policies and practices in your service area, there are some basic questions to consider, such as availability in your service area, eligible system size and customer type, rates, and design of bill credits.
Storage refers to energy storage, most often in the form of batteries. Installing energy storage with a solar system can help utilize the power generated when it’s needed most, regardless of whether it’s sunny outside at the time. Storage allows you to save that energy and use it later in the day, like when you turn the heat on at night or run the dishwasher after dinner or even when the power goes out. Ask your solar installer if they offer battery storage options and learn more about storing solar energy.
The amount of money you can save with solar depends upon how much electricity you consume, the size of your solar energy system, if you choose to buy or lease your system, and how much power it is able to generate given the direction your roof faces and how much sunlight hits it. Your savings also depend on the electricity rates set by your utility and how much the utility will compensate you for the excess solar energy you send back to the grid. Check the National Utility Rate Database to see current electricity rates in your area.
In some cities around the country, solar is already cost competitive with the electricity sold by your local utility. The cost of going solar has dropped every year since , a trend researchers expect to continue. Not only are the prices of panels dropping, so are the costs associated with installation, such as permitting and inspection—also known as “soft costs.” All of SETO's funding programs are working toward improving the affordability of solar and making it easier for consumers to choose solar.
It should also be noted that energy efficiency upgrades complement solar energy economically. By using Energy Star appliances and other products in your home, you’ll need less solar energy to power your home.
Consumers have different financial options to select from when deciding to go solar. In general, a purchased solar system can be installed at a lower total cost than system installed using a solar loan, lease, or power purchase agreement (PPA).
If you prefer to buy your solar energy system, solar loans can lower the up-front costs of the system. In most cases, monthly loan payments are smaller than a typical energy bill, which will help you save money from the start. Solar loans function the same way as home improvement loans, and some jurisdictions will offer subsidized solar energy loans with below-market interest rates, making solar even more affordable. New homeowners can add solar as part of their mortgage with loans available through the Federal Housing Administration and Fannie Mae, which allow borrowers to include financing for home improvements in the home’s purchase price. Buying a solar energy system makes you eligible for the Solar Investment Tax Credit, or ITC. In December , Congress passed an extension of the ITC, which provides a 26% tax credit for systems installed in -, and 22% for systems installed in . The tax credit expires starting in unless Congress renews it. Learn more about the ITC.
Solar leases and PPAs allow consumers to host solar energy systems that are owned by solar companies and purchase back the electricity generated. Consumers enter into agreements that allow them to have lower electricity bills without monthly loan payments. In many cases, that means putting no money down to go solar. Solar leases entail fixed monthly payments that are calculated using the estimated amount of electricity the system will produce. With a solar PPA, consumers agree to purchase the power generated by the system at a set price per kilowatt-hour of electricity produced. With both of these options, though, you are not entitled to tax benefits since you don’t own the solar energy system.
Navigating the landscape of solar financing can be difficult. The Clean Energy States Alliance released a guide to help homeowners understand their options, explaining the advantages and disadvantages of each. Download the guide.
DSIRE is the most comprehensive source of information on incentives and policies that support renewable energy in the United States. It is operated by the N.C. Clean Energy Technology Center at N.C. State University and was funded by the U.S. Department of Energy. By entering your zip code, DSIRE provides you with a comprehensive list of financial incentives and regulatory policies that apply to your home. Additionally, an experienced local installer should be able to assist you in claiming any state and local incentives, as well as the ITC.
If you want to learn more about state and federal solar policies regarding incentives and tax breaks, the Solar Power in Your Community guidebook (PDF) has a section—Appendix A on page 87—that explains it in detail.
Buying a solar energy system will likely increase your home’s value. A recent study found that solar panels are viewed as upgrades, just like a renovated kitchen or a finished basement, and home buyers across the country have been willing to pay a premium of about $15,000 for a home with an average-sized solar array. Additionally, there is evidence homes with solar panels sell faster than those without. In , California homes with energy efficient features and PV were found to sell faster than homes that consume more energy. Keep in mind, these studies focused on homeowner-owned solar arrays.
When it comes to third-party owned (TPO) systems, data shows that while they add some complexity to the real estate transaction, the overall impacts in terms of sales price, time on market, agreement transfers, and customer satisfaction are mostly neutral. In some cases, TPO systems can even add value.
The PV Value® tool is helpful for both home sellers and homebuyers. It calculates the energy production value for a PV system and is compliant with Uniform Standards of Professional Appraisal Practice and has been endorsed by the Appraisal Institute for the income approach method. Make sure your appraiser uses this tool to get the most accurate estimate of your PV system’s value.
There are two primary technologies that can harness the sun’s power and turn it into electricity. The first is the one you’re likely most familiar with – photovoltaics, or PV. These are the panels you’ve seen on rooftops or in fields. When the sun shines onto a solar panel, photons from the sunlight are absorbed by the cells in the panel, which creates an electric field across the layers and causes electricity to flow. Learn more about how PV works.
The second technology is concentrating solar power, or CSP. It is used primarily in very large power plants and is not appropriate for residential use. This technology uses mirrors to reflect and concentrate sunlight onto receivers that collect solar energy and convert it to heat, which can then be used to produce electricity. Learn more about how CSP works.
Absolutely! All solar panels meet international inspection and testing standards, and a qualified installer will install them to meet local building, fire, and electrical codes. Also, your solar energy system will undergo a thorough inspection from a certified electrician as part of the installation process.
A working PV panel has a strong encapsulant that prevents chemicals from leaching, similar to how defroster elements are sealed in a car windshield. Occasionally, a solar panel may break due to weather or other events. According to the International Energy Agency Photovoltaic Power Systems Technology Collaboration Program, any lead and cadmium exposure from broken solar panels in residential, commercial, and utility-scale systems would be below the acceptable limit set by the U.S. Environmental Protection Agency for soil, air, and groundwater.
Residential Consumer Guide to Solar Power – In an effort to make going solar as effortless and streamlined as possible, the Solar Energy Industries Association developed this guide to inform potential solar customers about the financing options available, contracting terms to be aware of, and other useful tips.
A Homeowner’s Guide to Solar Financing: Leases, Loans and PPAs – This guide from the Clean Energy States Alliance helps homeowners navigate the complex landscape of residential solar system financing. It describes three popular residential solar financing choices and explains the advantages and disadvantages of each, as well as how they compare to a direct cash purchase.
Solar PV Project Financing: Regulatory and Legislative Challenges for Third-Party PPA System Owners– Third-party owned solar arrays allow a developer to build and own a PV system on a customer’s property and sell the power back to the customer. While this can eliminate many of the up-front costs of going solar, third-party electricity sales face regulatory and legislative challenges in some states and jurisdictions. This report details the challenges and explains alternatives.
A Beautiful Day in the Neighborhood: Encouraging Solar Development through Community Association Policies and Processes – This guide, written for association boards of directors and architectural review committees, discusses the advantages of solar energy and examines the elements of state solar rights provisions designed to protect homeowner access to these benefits. It then presents a number of recommendations associations can use to help bring solar to their communities.
Selling into the Sun: Price Premium Analysis of a Multi-State Dataset of Solar Homes – This report from Lawrence Berkeley National Laboratory finds that home buyers are consistently willing to pay premiums of approximately $15,000 for homes that have solar across various states, housing and PV markets, and home types.
Residential Solar-Adopter Income and Demographic Trends – This report from Lawrence Berkeley National Laboratory finds that while solar adoption skews toward high-income households, low- and moderate-income households are also adopting, and that the rooftop solar market is becoming more equitable over time.
Learn more about the solar office's accomplishments.
A lot of people ultimately decide to go solar because the math works out over the long term. But to figure that out, you must first determine what your system should cost up front.
The answer to that question: It’s complicated, and it depends.
When Larry Gawel and his wife installed solar at their Lincoln, Nebraska, home in , the system cost about $18,000. The system has since provided for almost all their electrical needs, including heating and cooling. Recently their retirement planner asked for a summary of their utility bills and assumed that the figure they gave him was per month. “I told him no, that’s an entire year,” Gawel said.
At the other end of the range is the Central Florida home of Erik Erickson, Wirecutter’s director of platform engineering. To manage hurricane threats and routine power outages, Erik has specced out a slightly oversize solar array coupled to four backup batteries. Capable of powering the home if the grid goes down for a week or more, the system will come in at about $68,000.
The average price falls somewhere in between. The median price of a US residential solar installation was $4.20 per watt in (down from $14 in ), and such a system produced 7.2 kilowatts, according to a report from the Lawrence Berkeley National Laboratory (PDF). (That number skews low because California installs the most residential systems, but they’re relatively small; other states average above 8 kilowatts.) That works out to a total cost of about $30,240.
EnergySage, a “solar matchmaker” whose expertise we’ve highlighted before, has a detailed chart of state-by-state average costs that may give you a rough idea of what to expect for your home. Just be aware that the results shown there are limited to an average system size installed in that state, which may not match your own needs, and the figures are lower by about 25% than the numbers in the Lawrence Berkeley National Laboratory report. In part, this is because EnergySage factors in savings that you can get only if you use EnergySage to connect with contractors in your area.
The federal government will subsidize 30% of the cost of your solar project.
The Inflation Reduction Act of made several important changes to how federal solar tax credits work. For one, it extended the credit for years, until ; it also raised the rebate to 30% of the total cost of installation until , after which it tails off to 26% and 22% the next two years.
There’s no cap to the cost, either—whether you pay $10,000 or $100,000 for your solar project, you get the full value of the credit.
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In a sense, that may be all that you as a homeowner need to know. You have a long window in which to decide whether to go solar, where you can be confident of writing off 30% of the total cost. Your up-front costs will be reduced by almost a third, and you’ll recoup your investment that much faster.
Significantly, you can spread the credit across as many as the next five years of tax returns. This option is designed to maximize the credit’s benefits, since not every household will owe 30% of their project cost in taxes in the year of installation.
The Inflation Reduction Act also improves certainty and long-term planning in the solar industry itself, said Joe Lipari, vice president of projects at Brooklyn SolarWorks. “We always joke and call it the ‘solar coaster’ because so much of it is really influenced by political whims,” he said. “What the IRA did was provide certainty that this is an incentive that’s going to be here to stay… We’re so accustomed to, ‘It’s going to expire next year. Sign up now. Get it while you can. It’s never going to get better.’ It changes the mindset.”
And that should help smaller, customer-oriented local solar contractors—such as Brooklyn SolarWorks—stick around.
We strongly recommend working with such a contractor, versus a large national firm whose business model, as detailed by Alana Semuels in Time, prioritizes sales over service. (In Semuels’s words, “National solar companies essentially became finance companies that happened to sell solar.”) Tellingly, the first of the “40 Questions to Ask an Installer” suggested by the nonprofit American Solar Energy Society are “What year was your company established?” and “Where are its offices?”
Many states, municipalities, and utilities have their own incentive programs that will further reduce your costs, often significantly. For example, Wirecutter editor-in-chief Ben Frumin got an additional 19% of his solar installation subsidized by New York programs.
DSIRE, the Database of State Incentives for Renewables & Efficiency, makes it easy to find programs in your area using just your zip code. California, Minnesota, New York, and Texas have more than 100, and most states have at least several dozen. You still have to read through the descriptions of the individual programs to find those that apply to you (some have qualifying restrictions, such as income level), but having all of them gathered in one place for research purposes is a big help.
Any contractors you speak with should also be familiar with the programs you likely qualify for—after all, it’s in their own self-interest to help bring you to the decision to go solar—and if they are not, consider that a warning flag. Confirm that the contractors are authorized to submit proof-of-work statements to the utilities and agencies that handle the incentive programs, as well, since you’ll need that for your claims.
Installers may offer rates that are lower than banks’ too, which will lower your monthly payments, though likely not your total outlay.
“We try to make sure that we are very transparent with the customers as to what that looks like,” said J.W. Peters, co-founder of Solar Power of Oklahoma, one of the state’s oldest installers. “We have some options that are a 25-year loan at a 4.9% interest. But that loan product actually costs us more money to be able to offer to that homeowner. And so therefore, our cost estimate adjusts our baseline costs to adjust for that as well.”
You may find that it makes sense to put up some of the payment in cash. Wirecutter’s Erik Erickson carefully considered his options when working out the cost for his system. Eliminating his family’s monthly $415 electricity bill was a top priority, and “basically I’m getting down to $415 a month [in finance payments] if I put $7,000 down on top,” he said, “which is a chunk of change and was one of the biggest reasons I took a month to deliberate, because this doesn’t pencil out without extra money down.”
In the long run, it almost certainly will.
The tax credit is effectively a direct price cut on the cost of going solar. But solar installations also generally pay for themselves over time, through a combination of lowering your electricity bills and a process known as net metering.
Unless you plan to install storage batteries, even after going solar you’ll use power from the electrical grid at night, when your solar panels are producing nothing. And in high-demand periods—often summer or winter, when you’re cooling or heating your home, respectively—you may draw some electricity from the grid during the daytime, too.
Usually, you’ll still get a bill from your utility every month.
But much of the time, your system will produce more electricity than you need—weekdays when nobody is at home, for example, or shoulder months like March or April, when your area has a ton of sunlight and you’re not blasting your electricity-sucking air conditioner.
That excess power will go back onto the grid for other customers to use, and your utility will give you credit for the value of that power on your next billing cycle. That’s net metering, and with a well-designed system it means you’ll wind up paying very little for your electricity over the course of a year.
Over time, the money you save will more than cover the cost of the system and any loan interest.
However, it’s important to know how your utility calculates net metering, because that’s key to figuring out how fast you’ll see a return on your solar investment.
Knowing who provides your power and how the utility’s net metering works will make you a shrewder judge of contractors when you’re seeking bids.
Who provides the home’s electricity is one of the first questions Solar Power of Oklahoma’s J.W. Peters asks of prospective customers. Like most states, Peters explained, Oklahoma is served by a mix of publicly owned utilities, municipally owned utilities, and member-owned cooperatives. They use different net metering rates and credit structures—and some don’t offer net metering, period.
“We need to know who they have so I can figure that into the calculations,” Peters said. “We’ve seen a lot of kind [of] fly-by-night, door-to-door-salesman-type people coming in and knocking on doors in neighborhoods that know nothing about the utility structure in that area. They’re selling people systems, and in some cases even installing them, under false pretenses of what that system will do for those customers.” In the worst cases, he said, people have had solar installed, only to learn that they are not allowed to connect to the grid at all—so when the sun goes down, their home doesn’t have electricity.
Tom Broderick of Flagstaff, Arizona, talked to four installers when he was going solar in . “One of them knew what he was talking about—one,” he said. “Some of them said some really dumb things, and I didn’t call them on it, because I wanted to give them the opportunity to say more dumb things and find out what they really knew and what they really didn’t.”
Think like him. Understand your utility’s net metering program before seeking bids, and as Broderick emphasized, “Look at multiple installers. Get references. Check their business record with the Better Business Bureau. How long have they been in business? Are they certified?” Ideally that would mean certified by NABCEP, the North American Board of Certified Energy Practitioners.
Anyone researching this topic has likely stumbled upon some free online cost estimators, such as EnergySage’s tool.
Through that estimator, EnergySage calculates your potential lifetime savings from going solar based on your address and current monthly electricity bills, after which it solicits free bids from licensed and vetted solar contractors.
Another estimator, the National Renewable Energy Laboratory’s PVWatts, calculates your potential solar-energy production based on your address and roof size.
There’s also DSIRE, the Database of State Incentives for Renewables & Efficiency, which lists potential sources of low-interest loans, rebates, and other incentives for going solar based on your zip code.
Such cost estimators certainly help. But the reality is that to truly get a sense of the cost and value, you have to decide what you want solar to do for you—what you value most among the many benefits it can bring—and then work within your means to get a system that meets your needs.
Absolutely.
You can do a lot of things to lower your energy bills and carbon footprint that, happily, cost much less than a solar installation.
Consider community solar. You effectively pay for panels that are installed at a solar-production facility. They supply electricity to the grid at large, and you get a credit on your energy bill, much as you would with a system you installed at your house, but the household disruption and soft costs are eliminated.
Community solar is expanding rapidly, with annual growth more than doubling nationwide every year since . “Community solar has been a major driver of opening market access for folks, particularly people for whom residential solar isn’t financially or logistically feasible,” said Gilbert Michaud, assistant professor of environmental policy at Loyola University Chicago and policy division chair of the American Solar Energy Society.
At the end of , the baseline year of the most recent National Renewable Energy Laboratory report (PDF), community solar facilities totalling more than 6 gigawatts of capacity had been installed in 43 states and Washington, DC, with a third of that capacity installed in alone.
However, the distribution of community solar is uneven, with four states—Florida, New York, Minnesota, and Massachusetts—accounting for 75% of it (in terms of wattage) and the top 10 states accounting for more than 90%. Depending on where you live, you may have to do some legwork to find a local project to invest in.
Finally, and for older homes especially, relatively inexpensive upgrades to things like insulation and weather sealing can lower utility bills substantially. We cover many of the options in detail in our guide to home weatherizing. And Michaud pointed out that they too are supported by the Inflation Reduction Act—as part of the $8.8 billion Home Energy Rebates program—and by many state and local programs as well.
When I spoke with Iain Walker of Lawrence Berkeley National Laboratory in , he brought up a way of thinking about green technology that stuck with me.
There are dollar savings to consider, he said, and there are carbon savings—and sometimes the two don’t quite add up. A new induction stove would cost him considerably more in electricity each month than his old stove would cost him in gas, he said by way of an example. But its carbon footprint would be much lower, and that in itself is valuable to him.
Homeowner Tom Broderick told us, “[My] motivation is mainly climate change and doing something about it at my personal level,” but “it did matter that through my retirement, my costs would be lower for electricity.”
Homeowner Larry Gawel is pleased that he’s saving money and emissions at the same time: “Both of them are important to me.”
Wirecutter’s Erik Erickson plans to add an EV charger (and an EV) to his system, but “in a few years, after this is all through, because this is the most expensive project we’ve ever done.”
For homeowner Tom Lee, the initial decision to go solar—in Los Angeles, back in —was basically a dollars-and-cents matter. He was already doing a major home renovation, so it was a sensible time to get the installation done. The system was not cheap, at around $60,000, but “this house was going to be my forever house, so I figured it’s a good idea, right?” he said. “Especially with all this money coming back to me [from rebates and utility savings].”
But as time and technology moved forward 15 years, so did his appreciation for what he’d done. “I feel proud that I’m a solar owner,” he said.
This article was edited by Harry Sawyers and Ben Frumin.
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