Going solar is a smart move. Use this guide to calculate how long it takes before your DIY Solar Installation starts paying you back.
Solar technology is improving at an impressive rate. With the investments in the solar market, the more people that go solar, the better their systems are becoming. Current solar arrays are more efficient, customizable, and scalable. Plus, your solar installation will start making you money a lot sooner. But when will your solar start paying you back?
Know Before You Go Solar
One key item to look at before you go solar is the condition of your roof. Solar panels can last up to 25 years, is your roof in stellar shape to last that long? If you're not sure, or a definite no, then you will want to make improvements to your roof before you look at going solar. This will increase your initial costs to go solar, but it is a lot less expensive than trying to fix your roof after your solar array is installed.
Pay Back Calculations
There are really three areas to consider when looking at what you are going to spend to go solar; current electric bills, initial investment, and tax credits. Using these three factors will help you determine your payback period.
Current Electric Bills
How much are you spending on your electric bills? Look over a full 12 month period so you know what amount of power you use and how much spend in the winter and summer. These are usually the high and low times of your power bills, depending on where you live. Your electric bills will give you a better idea of what your home needs in system size to go solar, not what some sales guy is telling you. It doesn’t cost you anything to look at your last 12 electric bills. Start with your free information to save you big down the road.
Once you know what you need, through your current electric bills, you now know what you will need for the size of your system.
The system size is how big, or small, or a solar array you need to power your home.
One trap that people fall into when looking to go solar is to “make money off the grid.” Or to “have the power company pay YOU.” Unless you are planning on having a solar farm, keep it real and look at what your home uses. Go back to your power needs and see if you want to cover 50%, 80%, 100%, or even 120% of your electric bills. 120% won’t be a money maker, it will just be a nice bonus to your solar array.
The average USA home will have their power needs fully covered by an 8 kW Solar Kit. Take a look at our 8 kW Solar Kits to get an idea of what you are looking at for the solar equipment. Is this a high, low, or just right solar array for you? Who knows? You do. Your electric bills do. Calculate How Much Solar you need to make going solar a smart investment for you.
One big area that has had major improvements in recent years are Solar Battery Backups. The plus side of a Solar Battery Backup is that if the grid, i.e. power company, goes down, you still have power. The thing to consider with a Solar Battery Backup is the size and the additional cost of adding a Solar Battery Backup to your initial investment.
Not sure about having a hybrid solar array, which is a solar installation that is tied to the grid and also has Solar Battery Backup? If you are not sold on it now, work with professionals to design a scalable solar kit. This means you go solar sooner and then add the Solar Battery Backup later. Your solar array can start paying you back before you add more investment.
Homeowners can receive a one time tax credit of 26%. This is 26% off the initial purchase price of a solar array. If you buy an 8 kW Solar Kit for $9,200, this means you could get $2,392 back when you file your taxes. Put this money back to the solar array, and that means the average American can solar power their home for $6,808.
Does your electric company offer you incentives or rebates to go solar? If so, you can reduce the amount it costs you to go solar even more.
Estimate Your Payback
What does all this mean in terms of when your solar installation will start making you money? Be smart before you go solar and get informed. This will reduce your initial costs and reduce the time that it takes your system to start paying you back. If your average electric bill is $100 per month, that is $1,200 per year. If your solar array, after incentives, credits, and rebates, cost you $6,000, divide your electric bill total, $1,200, into this number. This means that your DIY solar installation will start making you money in five short years. If your solar installation lasts 25 years, that is 20 years of making you money.
Custom Solar Design
Do you need help deciding what solar panels you should use with which solar inverter? Our solar professionals can design a custom solar panel system for your unique needs. Plus the cost is included in all solar kit purchases of 5 kW or greater. You are saving on installation by DIY. Work with professionals to get the system that will work best for you and start paying you back soon.