The Pros and Cons of Going Solar
Get ready for another article with some level of complexity in terms of whether it’s a good idea, from a financial standpoint, to install solar panels in your home.
As the cost of energy keeps rising, it would seem installing solar panels should be the smart choice. But, as promised (warned), it’s more complicated than that.
Here are a few of the more important factors to consider:
An average solar panel purchase and installation costs between $15,000 and $20.000. The national average for the cost of electric in your home is 14 cents per-kilowatt-hour. So, it is imperative to check your electric bill to see what you are paying. The higher you are from the average, the more likely it becomes that going solar may make sense.
The exposure of your home to the sun is also imperative. How much sun does your home/state get during the year is also important when making the decision. Also, blockages such as trees or any other object is important to consider. More sun means more energy produced - and therefore greater savings. A good start in this regard is to use the SolarReviews calculator.
As with any major purchase, compare costs from different manufacturers and retailers; and definitely read the star ratings in reviews from the public.
Check the financial incentives from the federal government. Some states offer further incentives. The federal government offers a tax credit of 26% of installation costs, for panels installed by December 31, 2022. The credit diminishes to 22% in 2023 and expires at the start of 2024 unless congress renews it. But remember, these benefits aren’t guaranteed to last. As solar panels become cheaper, state and city governments continue to reduce incentives. Incentives at city, state, and federal governments may disappear eventually, so it may not pay to wait if you’ve decided that solar panels make financial sense for you.
Trade tariffs on China can increase the costs to the buyer of solar panels. So, keep an eye on U.S. trade policy.
Bottom line: If you live in an area with high energy rates and enjoy many days a year of sunlight, and can afford the purchase and installation costs, it’s likely worth installing the panels if high tax incentives are still being offered.
And remember, as stated above, shop around. You can also consider financing with a solar loan if you prefer to spread out the cost, or if your finances would be stretched by the expense.
Lastly, installing panels can raise the value of your home when it comes time to sell.