Are solar panels a good investment?
The simple answer: absolutely!
Well, when you consider the savings you will make on traditional energy options, the carbon-free energy production process, and saying goodbye to other unreliable sources of energy, solar power systems for your home are an incredible investment that will benefit you and the environment!
Utility bills are one of the highest monthly expenses in any home or business, and until the introduction of solar systems, they were practically unavoidable. With solar, you are able to reduce or completely eliminate the dreaded electric bill, and avoid the financial strain of constantly rising energy costs.
Along with conventional electricity usage, comes untimely and inconvenient power outages. Whether you are running a business or cooking dinner at home, a power outage of any kind can dramatically interrupt your day, and end up costing you money. But if you choose to go solar and invest in a battery backup system (such as the Tesla Powerwall), you can say goodbye to being shut off and stuck in the dark. The Tesla Powerwall can detect an outage, disconnect from the grid, and automatically restore power to your home in a fraction of a second.
Unfortunately, receiving hefty electric bills and incurring losses due to unprecedented power failures has been normalized, despite there being a sensible and affordable solution: solar. This is partly due to the fact that many people are turned off from going solar because of its seemingly high upfront cost. However, with current federal tax incentives and plenty of financing options, the financial barrier to go solar is much smaller than it may seem – but the savings are endless.
Let us highlight the various reasons why solar energy is a great investment.
- Reduce or Eliminate Your Utility Bill
Solar energy is considered a long-term investment because it has a typical payback period of 3-5 years. However, it is important to note that the moment your installation is complete, you will see immediate savings on your utility bill.
According to the US Energy Information Administration, a residential home in the US uses roughly $115.49 worth of electricity every month. Investing in solar panels is a great and viable option when looking for ways to cut down on utility bills. Among other things, the energy you harvest from your solar panels can be used for powering appliances, heating and cooling, and lighting, thereby freeing you from dependence on conventional electricity and the ever-growing expenses that come with it.
To put this in context, let us consider this cost-benefit analysis:
Imagine that you pay a monthly bill of $100 to your utility company, where utility rates have continuously increased by 3-3.5% per year. But then, you read a wonderful article from a local solar company about how much you can save by going solar, and you decide to see for yourself how great of an investment it actually is. Now, you have your own solar system that will completely pay for itself in just 3-5 years, and you are already enjoying free electricity that will continue for at least another 25 years! And because your solar panels have a warranty of 25 years and a life cycle of 30+, you are projected to save at least 3X of your original investment amount.
While installing solar panels for your home is a great way to save money and go green, utilizing solar energy for your business can cut costs and increase your profit margins. In an environment where the bottom line is one of the most important metrics, why wouldn’t you invest in something that has the potential to improve it year after year?
Most companies, especially those in the manufacturing industry, use a lot of electricity. By choosing to harness the sun’s energy, they will bring down power costs, positively affecting their bottom line. As such, the company will see a return on investment in the long run.
- Increase Your Home’s Value
There is no doubt that going solar will save you money on your electric bill, but one factor of going solar that is often overlooked is the value that solar panels will add to your home. Additionally, homes with solar often sell faster than those without. The idea of living in an energy-efficient home and eliminating problems that arise as a result of unprecedented power failure will attract potential homeowners. By investing in a solar system, you gain a competitive advantage against other home sellers, even at a higher asking price. Opting for a solar power investment improves your quality of life and adds value to your home, all while paying for itself after a few short years
- Take Advantage of Government Incentives
Did you know that a solar (PV) owner is entitled to certain tax exemptions?
The federal solar investment tax credit (ITC) is a tax reduction for households and businesses that go solar. Basically, the owners can claim 26% of the total cost of the system back on their taxes. This is particularly appealing to people who sought the help of financial institutions to install the panels, as they get to clear their loans earlier than expected. However, the ITC won’t be around forever. As of December 2020, the credit is set to reduce to 22% at the end of 2022, and completely disappear by 2024. The ITC is just another reason why there is no better time than now to go solar.
And if free money wasn’t enticing enough, solar systems also come with net metering advantages. If you tap excess solar energy, you can sell it to energy providers and earn extra money that you can use to clear any outstanding power bills.
Solar systems are a worthwhile investment, and their long-term cost-effectiveness is undeniable. If the seemingly high initial costs are a point of concern, between the ITC and various financing options, solar is more affordable now that it ever has been. If you want to take the next step towards a more affordable and sustainable future, contact one of our solar experts for a free consultation today!