In our previous blog post, we discussed average savings of solar power in generating electricity. We also touched on the environmental savings. Solar panels can dramatically reduce our dependence on fossil fuels like coal, oil, and natural gas. In this next post, we will talk about ways homeowners can save even more money by installing solar panel systems.
Defraying Installation Costs
How can homeowners defray the costs associated with solar panel installations? Typically, solar panels cost about $5 per watt to install. So, for a 3kW system, you’re looking at a price tag of around $15,000. That’s a lot of money, but have no fear: there are incentives available to help reduce these costs.
First, there are financing programs that are part of PACE (Property Assessed Clean Energy) legislation, passed in 31 states. Financing options like the HERO Program tie energy-efficient home upgrade projects to the property’s annual tax bill. This system is a competitive loan that allows homeowners to make energy-saving home improvements with little or no out-of-pocket expenses. Over a period of time, typically 5-20 years, the homeowner pays a little extra every year on their property taxes until the loan is paid off.
Homeowners who choose to install solar panels may also save money on annual taxes. Federal and state tax credits vary; states with sunny skies like California, Nevada, Arizona, and New Mexico offer very substantial tax savings.
In California, there are several such savings, including the Residential Renewable Energy Tax Credit and the California Solar Initiative’s SASH (Single-family Affordable Solar Housing) program. Local power companies may also offer incentives to homeowners. For example, the Pasadena Water and Power Company provides substantial rebates to homeowners who install solar paneling. Other power companies in many states offer similar rebate programs.
The Solar Alternative
There are many online calculators available, such as the one at Solar Estimate, to help homeowners select the right sized solar panel system for their needs. With the incredible savings in energy costs possible, installing solar panels as a renewal energy system makes a lot of sense, both environmentally and financially.