Solar power has become an increasingly common clean energy solution for homes and businesses of all kinds. People are choosing solar for environmental sustainability, personal independence, and of course, the financial benefits. It’s considered one of the most affordable energy solutions thanks to decreasing installation costs and the expected payback on a system. From reducing electric costs to earning incentives, we’re exploring the financial opportunities that are available when you invest in solar power.
If you’ve heard that solar pays for itself, you may be wondering how exactly that can be achieved. The power generated from a solar energy system can be a source of additional energy that you use alongside the power you pull from the local grid, or it can be a supplemental source of energy that replaces the power you would normally pull from the grid. More often than not, solar owners are achieving the latter and sourcing some of their energy from their own system instead of their electric provider.
So rather than charging for the cost of overall energy consumption, the energy bill would only charge for the electricity provided by the utility company. The savings on energy bills accumulate over time to eventually cover the initial cost of the solar installation. After the investment costs have been regained, a solar energy system generates power at no cost while continuing to offset utility electric bills. According to Energy Sage, the average payback period for solar in the U.S. is around 8 years. However, this time estimate truly depends on the system size, energy production, local utility rates, and other factors specific to the individual project.
Renewable energy incentives have not only made solar power more affordable, but they can also provide opportunities to make money. Solar owners that produce more power than they consume have a few options when it comes to handling the excess energy. Some choose to store it for later use (with the help of a battery) or send it back to the local power grid to be used elsewhere. Depending on the utility company and local policies, the owner of a system can receive payment or a renewable energy credit for the power that they’ve sent to the local grid.
Net Metering: In areas that offer net metering, solar owners are paid for the excess energy they have provided to the utility company. So a system that generates a surplus of energy eliminates the electric bill costs, while net metering allows the system owner to earn payment for energy they’ve provided to the grid.
Solar Renewable Energy Certificates (SRECs): In states that enforce renewable energy standards, utility companies are required to contribute to clean energy production. Solar owners in these areas can earn a certificate for the excess power that they’ve sent to the local grid. These certificates can then be sold to the utility company so that they may claim it as their contribution to the state’s renewable energy goals.
Solar power is an energy solution as well as a long-term financial investment. A solar energy system is much like a building renovation as it affects the value of the property. Investing in solar increases the value of a home or business location, earning the owner a profit upon resale. Systems have a typical lifespan of 25-30 years, which is longer than the average ROI period. An owner that sells their property after the system has paid itself off, stands to make a significant profit from the addition of the system to their property.
Benefit From Solar with YellowLite
The YellowLite team has completed over 1,000 installations of residential and commercial solar projects. Whether the goal is to reduce energy bills, have a back-up energy source, or eliminate utility dependence by going off-grid, our experts will work hard to design the most beneficial system for you.
Get started on your project by reaching out to one of our solar consultants!
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