With so much news coming out about cleantech and renewable energy, climate change, politics and the price of oil, it's easy to get overwhelmed by "the big picture." This can be either a depressing or inspiring experience, depending on your general outlook. We here at Getsolar lean towards optimism, and we all share a belief in innovation and our collective will to tackle the big issues, but we totally understand that sometimes it feels like we're not moving towards our energy goals fast enough.
Enough with the flowery introduction. This week I thought I'd take a break from the bigger issues and get back to basics to venture an answer to a simple, yet important, question: Is installing a solar PV system a good investment? Is solar right for me?
In rough terms, your system's expected return on investment (ROI) is a function of the following factors:
- Less initial costs (typically around $10 per installed watt of PV)
- - building permits
- + 30% Federal Tax Credit [Updated to reflect removal of $2,000 cap in 2008]
- + State, municipal and/or utility incentive(s)
- = Net Investment
- + Discounted annual savings in monthly utility bills (~25 years' worth)
- - Amortized loan payments (if financed)
- = ROI
A few concluding notes:
A solar professional can of course help you crunch these numbers, as well as provide you with a home energy audit that's helpful in understanding the financial benefits of a given PV installation. We're here to help with your project: fill out our solar Web form for free, one-on-one consultation.
If you do go ahead with solar, don't forget to consider energy-saving steps, such as installing LEDs and compact fluorescent light bulbs, and beefing up on insulation and weather-stripping where appropriate. Adding so-called negawatts to the mix will save you cash over the long haul and make each kilowatt from your solar panels go further.
Finally, remember that even if you don't live in sunny California or Arizona, solar panels and solar thermal systems can both help to reduce your monthly energy bills and add value to your home.
For more info, be sure to check out our FAQ section. If you have any questions that aren't answered, don't hesitate to post them. We love hearing from the solar community.