subject: Solar Panels Cost [print this page] So, just what is involved in calculating solar panels cost? When considering solar power very few people know the way the cost of solar panels is measured. Nor, for that matter, do we immediately grasp the connection between the cost of solar power and the value of solar power. Everyone knows that gasoline costs are in dollars per gallon. We also all know approximately the distance we'll be able to drive after paying forty dollars for a tank of gas. Unlike a tank of gas, the value of which is enjoyed (and used up) more or less immediately, solar panels deliver their value spanning over a number of years.
With that in mind, the purpose of this article is to address two issues: (1) How much do solar panels cost? AND (2) Can the value of solar panels outweigh the cost?
The initial question is directly connected to solar panels cost, so we'll address that first. Solar photovoltaic (PV) panels (that turn the sun's rays into electrical energy) are typically priced in dollars per watt ($/W). There are a few specifics related to this measure. It is possible you will notice many individuals look at DC watts vs AC watts. Additionally they may well discuss something known as dollars per watt peak ($/Wp). However, the most essential aspect to remember is the fact that, at the time you decide to purchase a solar energy system, you're really investing in the means or capacity to generate electricity right now and into the future. Really cool, huh?
So, how much are you shelling out? Exactly what is the out-of-pocket cost of a solar PV system?
Since every solar home installation is a bit different, the result differs somewhat from house to house. And, given that solar rebates and solar tax credits are typically made available at the local and/or state level, the cost varies to some extent from region to region. Bear in mind that all US homeowners with federal income tax liability will be able to take advantage of a federal solar energy tax credit worth 30% of system costs. Listed below are several useful resources about solar energy costs:
(1) The Open PV Project, a project of the National Renewable Energy Lab, relays pricing rates given by solar installation companies in the United States. The 2010 countrywide average cost for solar PV was $7.15 per watt. Not all solar installation companies are part of the program, and so the figures aren't perfect. But the data can provide an idea of about how much, let's say, the typical Arizona homeowner may be spending ($5.64/W) compared to the average homeowner in New Jersey spending ($7.64/W).
(2) Some states require solar installers to submit the costs from their solar installations and officials may hold back solar rebates in cases where numbers aren't provided. The result is rather precise solar panels cost data. Pennsylvania's Sunshine Solar Rebate Program, as an example, is reporting an average rate of $5.32/W for domestic solar energy ventures with a median system size of 8 kilowatts (kW). Go Solar California, a joint project of the California Energy Commission and the California Public Utilities Commission, is presently reporting quarterly updates on domestic solar costs, which are presently averaging about $7.19 per watt.
(3) If you are not quite sure, look for a general guideline. Whenever you are computing the price of solar panels work with a default cost of $7.00/W for residential solar projects. Even though this figure may not be exactly correct, it is a sufficient ballpark figure to start. Understand that this pre-incentive figure can end up being reduced by any solar rebates together with tax credits which are available where you live.
(4) Request at a minimum of two (ideally three) solar home energy quotes from qualified solar installers. In the end, it is not until you have a hard proposal that you'll be able to know how much solar panels will cost for your home.
As noted previously, because each individual project is unique, it is rather difficult to make generalizations. Nonetheless, supposing a pre-incentive price of $7.00/W, a typical 5-kW system would probably have a gross cost of $35,000 ($7.00/W * 5,000 W = $35,000). Any solar rebates can help reduce the gross cost further, as would the 30 percent federal solar tax credit.
Does the value presented by solar panels outweigh the cost?
Similar to the prior response, this one is going to vary from project to project, and area to area. In states which have been ideal for solar, like New Jersey, Pennsylvania, California, Arizona, Massachusetts Colorado and Hawaii, among others, a solar panel system is going to pay for itself in as little as three to five years and deliver dependable, long-term energy savings. When it comes to a residential solar energy project, you ought to weigh the factors listed below, each of which contributes to solar panels' return on investment:
(1)The actual amount you have to pay for electrical power. Everything else the same, homeowners who pay a fairly high per-kilowatt hour (kWh) price for their electricity will have the strongest financial return on their solar home energy system.
(2)The particular solar energy incentives available in your area. If you live in a state where you'll be eligible to sell solar renewable energy credits (SRECs), a residential solar energy system does not only lower your electric bill, it will also produce earnings above and beyond utility savings.
(3)The quantity of sunshine or insolation in your area. While virtually all of the U.S. gets plenty of sunshine to make solar power a good proposition, solar energy systems do provide additional power in sunnier areas.
(4)The likely influence solar panels will likely have on the existing value of your home. In most cases, solar panels raise a home's value and, accordingly reduce its cost of ownership.
A solid estimate should be able to specifically demonstrate the year-after-year financial benefits of any given system. It will likewise include a monetary evaluation that provides an estimated investment recovery time frame and return on investment (ROI).
Naturally, it is your choice, the homeowner, to come to a decision on exactly what financial return you want in a home energy improvement. A lot of people are comfortable with a ten year investment recovery and understand that a solar panel system would continue to produce inflation-protected financial savings for a minimum of an additional 15 years after that 10 year bench mark. Some other individuals will require a payback of, maybe, 5 years or less.
Generally, nearly all new solar power projects are noticeably decreasing property owners' power bills and giving a positive ROI. The value of solar panels is much more than the start up solar panels cost. To be honest, on the other hand, you will find occurrences in states that regional solar incentives are small and/or electrical power is pretty inexpensive. For example Kentucky, Alabama and Nevada. At this point within these areas, it's hard to say that the value of solar is actually greater than the expenses. Faced with a 19-year payback and a return on investment in the low single digits, a person in Nebraska, in particular, may be forgiven for his / her skepticism.
As solar panels cost is becoming a little more cost-effective all the time, and while an increasing amount of states are taking actions to promote demand for solar power, you can expect to see that the value of a home solar energy system will increase for nearly all property owners across the nation. In the event that you are fortunate enough to reside in a state in which the value of solar already is greater than its cost, don't lose out on a wonderful opportunity!
