15 Solar Panel Financial Benefits
In the last few years solar energy has become one of the most cost-effective sources of energy and there are many solar panel financial benefits you should know of if you are thinking about going green.
It is a limitless and renewable energy source that has been used as an ecological way to produce energy for our daily uses.
The source of solar energy is the rays, generated by the sun.
Solar energy can be used when the electromagnetic radiation of the sun’s rays is absorbed by a solar panel.
Solar panels have solar cells that react with sun rays to generate electricity, which is used to power our home and other places.
Solar energy is sustainable, renewable, and plentiful.
Many Americans are switching to solar because the cost of using solar to produce electricity going down each year, Now, there are more than a million solar installations in the country.
Solar energy is becoming one of the most popular alternative energy in the U.S.A due to the incredible benefits that come with delivering clean solar energy.
Many of us think that the installation of solar power is expensive or not affordable.
And we also think that only the wealthy can afford such luxury.
But many people don’t realize the amount of money you save on that wise investment of solar energy.
Most of us don’t necessarily have the cash on hand to pay out of pocket either, but there are several energy-friendly banks, they offer great deals on loans for investment that does good for our planet.
House owners who install solar panels on the x§rooftop can benefit by saving thousands of dollars on their electricity bills, increasing the value of their houses, and stabilizing their energy costs while combating global climate change.
In short, the financial benefits of the solar power range from immediate reductions in out-of-pocket costs, to long-term programs designed to provide a steady income for decades.
What Are the Benefits of Solar Electricity at Commercial and Residential Levels?
1. Electricity Savings
With a solar power system, you avoid frequent rate hikes associated with fossil fuels.
An average residential system in New Jersey will produce approximately 8,400 kWh every year.
At an average utility rate of $0.16 per kWh, you’ll save $1,344 in the first year if you purchase the system.
And that doesn’t count the income that could be generated by SREC’s on top of that!
Your local utility rates are probably higher than you’d like. Unfortunately, saving money by turning off the lights and easing back the AC may only go so far.
Saving money on your energy bills is great, but energy efficiency is not the only financial benefit that you will enjoy by installing solar panels on your roof. Solar energy also provides homeowners with long-term stability and reliability concerning residential electricity prices.
The sun provides us with an infinite amount of energy that can be harnessed to power our homes.
As a result, homeowners that install panels can stabilize their energy costs while those relying on the traditional sources of electricity will continue to be subject to volatile and unpredictable energy prices.
The cost of electricity which has been increasing every year for electric and gas-powered homes and industries can be saved by installing solar panels.
Check with your solar panel provider to see if solar energy would be a good solution to energy bills for your area, home, or business before investing.
When you decide to install a home solar system and a battery, you can better control your average electricity costs over a year.
Households with the highest electricity rates from their local utilities are the ones who stand to save the most when they convert to power from the sun.
Whether a solar system is paid for entirely upfront, financed over time, or a hybrid of each, the long-term cost is significantly less than the typical electrical bill. This is especially true in areas where the utility company charges a high kW/hour rate.
Additionally, once any financed portion is paid in full, then you essentially get power for free with no monthly payments.
2. Increased Home Value
Multiple studies have found that installing a solar energy system on a home can increase the value of the home.
Lawrence Berkeley National Laboratory found homebuyers are willing to pay a premium of $15,000 for homes with an average-sized solar power system.
Combined with the 30 percent tax credit, the affordable cost of electricity, and the fact that panels can provide a return on investment equaling roughly half the cost of an average installation, solar practically pays for itself, which is why installed solar systems increase property value.
A solar panel system is viewed as an upgrade, such as a renovated kitchen or a finished basement that will increase your home’s value.
Although market factors like electricity rates and system size may impact the size of the premium, solar homes can sell for more than homes without PV.
While the market penetration of residential solar energy systems is still very small, it is most certainly growing…and at a very quick pace.
Home buyers increasingly look for properties that have solar systems because of the many benefits previously listed. Depending on the area that you live in, you can receive up to $20,000 in property value for every $1,000 reduced in operating costs annually.
Adding solar power to your home increases your home’s resale value by an average of $5.50-$6.40 per watt. For example, if your home has a 3.8KW system you’re adding $20,900 to your home’s value.
Whatever your reasons for considering solar for your home or business, you can be assured that there are some significant financial incentives for a system that has energy efficiency, reliability, and sustainability compared to the standard electrical grid.
For more information regarding these benefits or any other questions about solar
It is well-known how important solar energy is to the effort in reducing our carbon footprint in America and becoming a more energy-independent nation.
As a result, the US government has created many financial incentives for individuals and families considering a solar energy system for their homes in America.
Some of the solar incentives that you may qualify for include:
- Solar Investment Tax Credit (ITC)
- Solar Renewable Energy Credits (SRECs)
- Federal Solar Tax Credit
- State & Local Rebates
In some areas, as much as 90% of the cost of a residential solar power system can be offset with these rebates and tax credits.
4. Solar Works Everywhere
The solar resource of the United States is enormous.
Just one hour of the noontime summer sun is equal to the annual U.S. electricity demand.
Most states in the United States have good-to-excellent solar resources.
Even places with relatively low solar resources, such as the Pacific Northwest and Alaska, can experience cost savings and have similar solar resources to countries that have widely developed solar PV, like Germany.
5. The Preservation of the Environment
Each kilowatt-hour (kWh) of solar that is generated will substantially reduce greenhouse gas emissions like CO2, as well as other dangerous pollutants such as sulfur oxides, nitrogen oxides, and particulate matter. Solar also reduces water consumption and withdrawal.
6. Say Goodbye to More Time-of-Use (TOU) rates
For states with TOU rates, going solar with a home battery allows you to run your appliances when you want, not when electric companies tell you to. Since TOU rates are charged during peak hours, after work, and during dinner, they can lead to a higher electricity bill. That’s utility surge pricing. If you can use energy in the morning or during the day, you’ll probably pay less.
We often need to power up our homes when it’s convenient for us. With solar and a home battery, you are in control.
Excess energy is stored in your home battery and you can use it when you need it the most.
7. Net Energy Metering (NEM) Works for You
Net Energy Metering allows customers who generate their electricity from solar panels to sell the excess electricity generated back to the grid.
However, not all states have NEM policies, and these policies vary by state. A reputable solar company can explain the NEM in your location.
8. Federal and State Incentives
Currently, you can deduct 30% of the cost of your purchased home solar system from your federal income taxes. Many state and local governments offer property and sales tax exemptions, too. Cash rebates can also help you reduce your costs by about 10% to 20%. Find out more about federal and state incentives.
9. Helps Others in Times of Need
We need the energy to live our daily lives, but we also need the energy to help those less fortunate. People all over the world are using solar energy to push through power outages caused by storms and other natural disasters that can lead to loss of life and property.
Events like floods, wildfires, hurricanes, rising sea levels, and hunger-related environmental damage have caused devastation around the world.
The costs associated with climate change are growing and include rising health care costs, destruction of property, increased food prices, and more.
Wide-scale adoption of solar and other renewable energy must continue so we can address the negative societal and economic impacts of dirty fossil fuels.
10. Solar Energy Means Healthier Air
We all need clean air for survival. But ground-level ozone and other pollutants from cars, power plants, industrial boilers, refineries, and chemical plants can kill. The damage extends to crops, trees, and other vegetation, and the toll on human life is significant.
Pollution is so bad in some parts of the world that people are instructed to stay indoors. The Environmental Defense Fund states that pollution is responsible for the deaths of 6.4 million people per year.
In contrast, solar energy supports a planet that is clean and green. By eliminating harmful toxic emissions from fossil fuels, solar lets us breathe easier and provide healthy air for future generations.
11. Creates Jobs and Supports Families
When your community is gainfully employed, everybody benefits. The U.S. solar workforce increased 168% in the past seven years. In 2010, the industry hired 93,000 people.
In 2018, the number of solar jobs increased to over 242,000, and further growth is expected. The best thing? These solar jobs cannot be outsourced so they are a significant contributor to our economy.
12. The Price of Sunlight is Zero
The sun is a renewable resource. Unlike fossil fuels, sunlight is never going away. You can count on it every day.
Coal and natural gas are not free, and they are expensive and dirty. Their price is volatile too and has increased systematically over the past decade. But there is no fuel cost for sunlight.
With Sunrun’s residential solar, you will know your annual energy expenses for at least the next two decades.
13. Reduction of Greenhouse Gases
The Environmental Protection Agency (EPA) reported that new motor vehicles contribute significantly to greenhouse gases, which endanger our public health and welfare.
The good news is that an electric vehicle can be powered by your residential solar system. You can use clean power from the sun to fuel your car and run your home.
The switch from fossil fuels to solar energy contributes to healthy communities and a healthy planet.
14. Reduces Carbon Footprint
The majority of residential electricity in America is currently being sourced from fossil fuels, such as coal and natural gas. These fossil fuels are very harmful to the environment when burned to generate electricity and are widely considered to be the leading cause of global climate change.
By installing solar energy systems on the roof of your home you can help to combat greenhouse gases while reducing America’s dependence on fossil fuels.
The average residential solar PV system reduces about 100,000 lbs. of carbon dioxide over 20 years.
15. Strengthens the Local Economy
Solar panels don’t just give personal savings, but community savings as well. People waste money by using traditional sources of energy, but it is a renewable and inexhaustible source of energy.
Solar farms are an example of panels being used to harness energy on a wide scale, which can help agriculture efforts. It also opens new jobs for installers, designers, and manufacturers and allows for people other than large electric and gas companies to succeed in the business of energy.
Solar energy saves two types of green, the environment, and your money. Although the initial investment can be high, the long-term savings for your wallet and the environment easily trump initial fees and you can soon realize all the financial benefits of solar energy systems.
The longevity of panels, tax deductions, and general savings make solar panels the best alternative to traditional energy.
What Are Renewable Energy Credits (SRECS OR AECS)?
For every 1,000 kWh of power your system produces, you will earn a Renewable Energy Credit often referred to as an SREC or an AEC.
These credits are accumulated over time and can be sold on a state market according to a fluctuating value based on supply and demand. In other words, you can receive extra income by selling these credits, and this is an added financial incentive to consider.
Apart from financial benefits of solar for households and industries, there are many other reasons why we should all strive to go green and switch to alternative energy sourses.
In this article, we have covered some of those reasons and explained them in detail.
If you have any questions or comments, please let us know in the section below.