Answering Questions: Are Solar Panels a Good Investment For US Homes?
In 2022, Americans installed enough solar panels to power 22 million homes, and in the first half of the year, new solar capacity added to the U.S. grid climbed by 6% more than in 2021. This clearly shows the increasing popularity of solar power systems in the USA. But what are the reasons behind it?
In August 2022, U.S. customers' electricity prices increased the highest since 1981. It blew up to 24% more than the prices in August 2021. If this wasn't enough, natural gas prices also went up by 33% compared to the previous year. Inflation is at an all-time high, and the best way to deal with it is going solar. Even the government admits it and offers a 30% Solar Tax Credit on all solar installations executed between 2022-2032.
Solar Panels For Homes: A Good Investment?
With the 30% STC at hand and companies like YellowLite guiding you with your solar installations, it has become effortless for people to go solar. But before we get on with the installation procedures, let's see what's in it for you if you install a PV system at your place.
Let's talk about solar savings! It's the amount of money saved that you would have spent on your electric bills. According to the US Energy Information Administration, a US residential utility customer consumes 10,715 kilowatt hours (kWh) per year (on average). This equates to an average of 892 kWh per month.
If you multiply this by the national electricity rate on average ($0.14 per kWh), you'll find that an ordinary American household pays approximately USD 125 in electricity bills per month. Imagine if you had a PV system installed at your home. You'd have saved $1,500 per year in electricity bills! Solar panel investment indeed pays off.
Now we know that all US residents have different energy consumption patterns, and one shoe never fits all, so here is an efficient way to calculate your solar savings.
Calculating Solar Panel Return on Investment
There are several techniques to examine solar panels' return on investment (ROI). Since no strategy is ideal, individuals frequently examine several different ROI computations. Internal rate of return analysis is one of the trickier techniques.
Converting Payback to a Simple ROI
Solar power is a dependable and sustainable energy source. Additionally, it is a sustainable choice. Solar-paneled homes can provide their owners peace of mind knowing they will always have power. For your house, solar panels are a wise investment because they can assist in generating the energy you require.
We can now compare a 10% solar return on investment to other alternative investment options. Bonds, or more literally, a bond fund, are one popular choice. Bonds provide a reduced risk that is comparable to solar panels. Therefore they seem to be a good analogy in this situation.
Given that interest rates are now close to historic lows and that the value of the bond fund would decline if they do rise, this is especially plausible. As of December 31, 2017, the Vanguard Intermediate-Term Bond Index Fund's 5-year average annual return was 2.15%. Solar panels are, therefore, the apparent winner in this scenario at a 10% return.
Are Solar Panels a Good Investment in winters?
You can have your solar power system built in the winter so that it will be fully operational in the summer. After an application is received, net metering systems might take up to 90 days to be implemented. This indicates you have a functioning net metering system that will allow you to sell power and utilize the credits gained to pay for summer expenses.
A solar power system installation is an investment for the whole year, not just one season. The layer of solar panels works as insulation against cold weather, allowing you to maintain the interior temperature warmer than the outside temperature. During the summer, it serves a similar purpose by keeping the interior cooler than the outside.
Buying a Home with Solar Panels Now vs. Getting Solar Panels Installed Later!
Solar-paneled homes have been demonstrated to stand out, sell more quickly, and earn more on the national real estate market. Inquire about warranties, leasing payments, maintenance history, and the typical amount of energy generated if you're thinking about purchasing a property that already has a solar array.
In certain circumstances, purchasing a house without solar panels and installing them yourself can be desirable. Installing solar can shield your house from unforeseen power outages and your budget from fluctuating energy bills.
By balancing your monthly utilities, avoiding rising and unpredictable energy prices, and significantly reducing your carbon footprint, adding solar to your house can help you save money. Similar to how purchasing a home protects your funds by converting a monthly cost into asset growth.
Prominent Benefits of Residential Solar Installations
Going solar is an important and rather complex decision. There are so many things to consider. Will it affect your home value? What will be the total cost of installation? What amount of energy will actually be used? Do you even get enough sunlight at your place to make solar panels work? Such are the questions that pop up in the mind and it's important to answer them before you invest in solar energy systems. If you find yourself stuck at any of these, the experts at YellowLite will be able to help you. You can contact them here.
A solar energy system is a long-term investment, and once you learn how much solar panels can benefit you, you’ll never go back. Here are a few benefits of solar energy that can help you make the final decision.
Enhanced Property Value
Installing solar panels can be a fantastic way to make your home more appealing to prospective buyers and raise the value of your property if you plan to sell it soon. According to National Renewable Energy Laboratory research, installing solar panels on a property can raise its value by around $20,000 on average. Another study by Zillow states that homes with solar-energy systems sold for 4.1% higher price and if we look at the median-valued home, this percentage translates to an additional $9,274. The house price value also depends on the location and amenities so the numbers can vary accordingly. You can learn more about solar energy and real estate here.
Reliable & Renewable Source of Energy
A dependable and sustainable energy source is solar energy. It is also a choice that is ecologically beneficial. Solar-panel-equipped homeowners can be confident they will have power when they need it most. Because they can assist in generating the energy you require, solar panels are a wise investment for your house.
The cost of installing a solar system is one-time, and it doesn't need any more expenses beyond the standard maintenance costs. Solar panels are relatively inexpensive to maintain and need very little upkeep. Solar energy has a greater return on investment than other sustainable energy sources. It is one of the safest investment types due to its great ROI and extended payback times.
No More Electrical Fire Hazards
Solar energy systems can considerably lower the risk of an electrical fire since they are less susceptible to electrical surges. The third most common reason for these incidents is electrical distribution networks. Solar panels, on the other hand, have not frequently been connected to electrical fires. Take your safety into account while deciding whether or not to invest in home solar power.
YellowLite is here to Help You!
So, what have you decided? Are solar panels a good investment for you? If yes, let us help you with the best solar services.
Yellowlite builds and installs solar energy systems for both business and residential customers. After years of working with the largest solar technology wholesalers, the top executives decided to start their own company. We are dedicated to bringing solar energy into the mainstream as a viable alternative to nonrenewable energy sources that harm our environment. Contact us today for a free consultation.