Although solar panels have become more affordable in recent years, they are still a major investment. Establishing priorities with your architect and finding solutions that align your needs with your budget is the best way to get the value you need.
In this article, you will learn about 5 factors you should consider before investing in solar power:
Benefits of Solar Energy
- Reduce energy bills: Solar energy systems generate electricity that you can use yourself and reduce or eliminate your reliance on the grid. This can reduce your monthly energy bills.
- Create an energy source: Solar energy systems produce electricity that can be used to power your home and can also be sold back to your local utility. This creates an additional source of income.
- Resilience: Solar energy systems are self-contained and can operate independently of the grid. They don’t rely on centralized sources of energy and can be used in the event of a disaster or grid power outage.
- Sustainability: Solar energy systems are a clean source of energy that don’t produce any harmful emissions. They don’t rely on fossil fuels and can help reduce your carbon footprint.
Challenges with Solar Energy
Many of the challenges with solar energy have to do with the cost. But there are some operational challenges as well, and things to pay attention to before you deploy solar energy systems.
- Availability: Solar panels are not an on-demand energy source, so they are not available when the grid goes down. You will need batteries or other energy storage systems to cover that contingency.
- Location: Solar panels face south for a reason; they're designed to capture the most amount of sunlight that hits the northern hemisphere. That doesn’t work if your house is facing the wrong direction.
- Maintenance: Solar panels will degrade over time. You’ll need to replace them at some point, and that could affect the finances. You may also need to clean them regularly if you live in an area where there’s a lot of dust in the air.
Energy Use and Feasibility
On top of the cost, you also need to consider the amount of energy you use. If you don’t use enough electricity, you won’t be able to justify the expense of installing solar panels. A good rule of thumb is that you need to use at least 10 kW of electricity per hour to make the investment worthwhile. It’s also important to factor in the energy use of any appliances that you plug into the grid. You can expect solar panels to produce energy in the summer when the days are longer and the sun is at its brightest. They will produce less energy during the winter months when there’s less sunlight. You may need to adjust your energy use to accommodate those seasonal changes.
Cost and Financing Considerations
One of the first things to consider when investing in solar energy is the cost. The cost of solar energy varies by state, but the federal government has created a Solar Investment Tax Credit (ITC) to help homeowners pay for solar. It’s important to note that these are credits and not deductions, so you can apply them to the total cost of your solar energy system. You can still deduct the interest on your solar energy system if you’re financing it. You should also consider how long it will take to pay off your investment. If you’re getting a loan to finance the system, it’s important to factor that into your decision. You need to make sure that you have enough time left on your loan for it to be paid off.
Also, there’s the federal tax credit available for anyone who decides to invest in solar energy. In August 2022, Congress passed an extension of the ITC, raising it to 30% for solar installations and battery backup. This credit is for 30% of the cost of your solar energy system, applied to your total cost, whether you’re going to pay upfront or use a financing plan. Most of the homeowners decide to go with a financing company to avoid paying upfront and spending a bulk amount of cash.
Short-Term vs Long-Term Benefits
The noticeable benefits of solar energy are long-term, which is why it’s important to consider both the short- and long-term benefits of solar energy. In the short term, you’ll need to pay the costs of your solar energy system. You may also need to take out a loan and pay interest on that loan. In the long term, you’re likely to see a reduction in your energy bills and a return on your investment. If you get a loan to finance your solar energy system, you’ll need to pay that off. However, once your loan is paid off, you’ll only see a reduction in your energy bill.
Conclusion
Solar energy is a valuable resource that can help power our homes and reduce our carbon footprint. However, it’s important to consider the costs and benefits of solar energy before investing in a solar energy system. Solar energy systems come at a significant cost and produce less energy in the winter months. However, they produce clean energy that can reduce your monthly energy bills and help to power your home during a grid power outage. We can observe that going solar is getting popular and being the trend nowadays. We’ve helped a lot of homeowners in several states to get solar panels and simplify the process for them, as we deal with the best companies for solar installation and solar financing.