While most of the population is first drawn to solar because of the environmental benefits that switching to solar has, the reason that people ultimately invest in solar is due to the significant financial savings. Residential solar panels not only help you reduce your carbon footprint, they help you save money on your utility bills, as well. Rebates and incentives like the federal solar tax credit can help you save even more and have made installing solar panels even easier.
How much you actually save depends on many factors, including your power usage, local electricity rates, and the size of your solar system. So when you see statistics on how much solar energy saves on average, those numbers aren’t taking all of these personal details into account. Installing a solar power system allows you to reduce or even eliminate your electricity bill. When you pay upfront for the installation of your solar panels, you are effectively paying today for the electricity you’ll use over the next 25 or even 30 years. Calculating your savings from investing in solar is as simple as subtracting the amount you pay for solar from what you would have paid for electricity otherwise.
It’s time to think about solar as a profitable financial investment. If you’re considering solar, it’s worth starting to think about installing solar as an investment. Solar shoppers on Austra Solar have observed tens of thousands of dollars in savings from investing in solar over the 25+ year lifespan of solar panel systems. Many solar panel systems pay for themselves in eight years or less, while home and business owners who install solar see a return on their investment in the double digits.
The estimated savings with the installation of a solar power system can be calculated using the following factors:
- Your location
- Your energy usage
- Current average price offered by solar companies in your area
When talking about solar savings, we are actually talking about avoided energy costs, or the amount of money you would have spent on your electric bill had you not installed solar panels on the roof of your home or business.
There are three key factors that influence how much you can save with solar:
- Your current electricity bills
- The cost of installing a solar power system
- How you pay for your solar panel system (i.e., upfront or through monthly instalments)
Factor 1: Your current electricity bills
The most important way that solar saves you money is by reducing or eliminating your monthly or quarterly electricity bill. Therefore, the amount you pay for electricity today heavily influences the level of savings you can obtain by going solar. One thing to think about is if you live somewhere with higher electricity rates compared to elsewhere in the country, your solar energy savings will be higher.
Factor 2: Cost of installing a new solar power system
The second part of the savings calculation is how much you’ll pay for solar. Importantly, federal, state and local incentives can all contribute to lowering the cost you pay for solar. From the Investment Tax Credit to solar renewable energy credit (SREC) programs, incentive and rebate plans can reduce the amount you pay for solar significantly.
There are many other factors that influence the price you pay, but no matter your scenario it’s important to compare multiple quotes for solar so you know you’re getting the right system at a fair price.
Factor 3: How you pay for solar
There are three primary ways to pay for your solar panel system: a cash (upfront) purchase, a solar loan, and a solar lease or PPA. Each of these options provides different pros and cons. Generally speaking, you’ll save more on your electricity if you pay for your system upfront than if you pay for it over time with a loan or lease/PPA.
Contact Austra solar today to get a free quote for a new solar system for your home and start saving!