How Much Can I Save on Solar?
Investing in solar is not only good for the environment, but it’s good for your wallet too. Rising utility costs and renewable energy tax credits are fueling an increase in solar consumption. In fact, solar consumption in the U.S. doubled during the three year period between 2013 and 2016, according to the Energy Information Administration (EIA).
Also, the City of South Miami recently became the first Florida city to pass an ordinance requiring solar panels installed in new homes and in some home renovations. The city joins three other California cities that already require solar, but other cities will likely adopt a solar ordinance too.
Solar is a very attractive investment for a number of reasons: First, solar is a fixed price investment with no recurrent monthly fees. So once it is installed, the system pays for itself each year. Second, utility rates and the cost of fuel to generate power will continue to rise amid growing consumption. Third, when installed correctly solar panels have a long life expectancy usually around 20 to 30 years making it a sound investment.
What you’re paying for Electricity
Utility rates will continue to rise over the long-term. In 2015, the nationwide average cost for per kilowatt hour of electricity was 10.42 cents, based on EIA data. However, during the summer of 2017, the average cost of electricity is expected to peak at $0.13/kWh, an increase of 3.7 percent from the previous summer. Homeowners in Hawaii and Connecticut pay the most for electricity at $0.26/kWh and $0.1776/kWh, respectively.
How Much Can I Save
With homes filled with so many electric devices these days, you’re probably consuming more electricity than you think. The average homeowner consumes approximately 1,000 kWh of electricity every month. But how much money you will save on solar depends on a number of factors including where you live.
But even in some of the least sunny places in the country like Pennsylvania and Vermont, homeowners can still expect to save an average of $500 to 750 per year on electricity costs. That can add up to a substantial savings of approximately $15,000 over a 20-year period. And in sunnier climates with higher than average utility costs like California and Hawaii, the savings are even greater at over $1,500 – $3,200 annually on average.
Solar Tax Credit
If the thought of free electricity courtesy of the sun isn’t enough, there is nothing like a big bonus from Uncle Sam to sweeten the deal. For a limited time, homeowners can claim a whopping 30% percent rebate in the form of a personal tax credit off the entire qualified cost of installing solar. Your system must be installed and placed in service by December 31, 2019, to qualify.