Tapping Into the Sun at Home: Residential Solar Benefits, ROI, Installation, and Upkeep
Solar panels convert light from the sun into electricity. They are used to charge remote power systems, operate telecommunications equipment, and keep homes and businesses running. Although a solar array requires a substantial initial investment, solar panels are an energy-efficient upgrade that have many benefits, including major cost savings that can make the array worthwhile. At one time, these systems were an uncommon feature on homes and businesses. Today, they can be found on structures around the country, in all climates and regions.
Solar systems are popular due to their energy efficiency, money savings, high value to property buyers, and the tax rebates that make them more affordable. Homeowners and business owners interested in adding solar panels to their property have a lot of information to consider before moving forward, such as system cost, leasing versus buying, system longevity, and return on investment.
Standard solar array systems last 20 years or longer with proper maintenance. Therefore, it is critical for those interested in solar panels to learn as much as they can before making their final decisions.
Table of Contents
- The History of Solar
- Advantages of Solar
- Potential Drawbacks of Solar Power
- Planning a Solar Electric System
- What Are the Options for Using Solar?
- Solar Panel Cleaning and Maintenance
- Is Solar Worth the Investment?
The History of Solar
People have been using energy from the sun to improve quality of life for thousands of years. In the 3rd century BCE, Greeks and Romans used light reflected off burning mirrors to ignite torches during sacred ceremonies. Greek legend tells a story of a scientist named Archimedes who set fire to enemy ships by reflecting sunlight off bronze shields and focusing energy beams on the wooden structures.
Photoconductors were discovered in the 19th century, and by the late 1800s, materials that could generate electricity when exposed to sunlight were discovered. While these primitive solar cells were different from present technology, these discoveries paved the way for modern solar energy systems that power today’s homes and businesses.
The next leap in solar technology came in the early part of the 20th century when Einstein published a paper on the effects of light and how it carries energy. In the 1950s and 60s, scientists used solar energy to power certain systems on spacecrafts. Later, this same technology was converted into more everyday uses. The energy crisis of the 1970s forced scientists to explore new potential energy sources. Solar panels were installed on the roof of the White House, but at that time, solar was highly inefficient. Groups like energy providers began investing in solar research to determine if this type of energy could be improved.
It’s estimated that the first solar panels operated at 1% efficiency and produced electricity at a cost of approximately $300 per watt. Those statistics changed dramatically as scientists found ways to improve solar energy. Today, solar power can be generated at a cost of approximately $0.50 per watt. While this is much better than earlier versions of the technology, most solar panels operate between 15% and 18% efficiency. There is still room for improvement, and the technology continues to progress.
Advantages of Solar
There are so many advantages to solar power that for many homeowners and business owners, installation of a system is an obvious choice. In addition to energy efficiency and money savings for property owners, solar panel installation can be a display of a company's dedication to eco-friendly construction for those who want to attract clientele that prioritize eco-friendly businesses.
For homeowners, installing solar panels can raise property values and make the house overall more attractive to buyers seeking an energy-efficient house. Some homeowners also value solar panels because they want energy independence, which allows them to not have to rely on the services provided by standard utility companies.
Save or Eliminate Energy Costs
One of the first and foremost reasons that property owners choose to install solar panels in their home is because they're seeking energy savings. Solar power, generated by the sun, is in theory completely free — after the solar panels have been purchased and installed.
However, some property owners choose to lease their system rather than purchase it. In this case, energy savings depends on a variety of factors, including the structure's energy consumption, size of the solar energy system, whether the system is leased or purchased, direct hours of daily sunlight, size, and angle to the roof and local electricity rates.
Increase in Property Value
Return on investment is another common reason that property owners choose to install solar panels. Structures that are inherently energy efficient often sell for more money than structures that are older and less energy efficient. Solar panels are viewed as an upgrade, with a standard return on investment of about $15,000. However, ROI can vary based on factors like the age, cost of the system, size, and so on.
Tax Credits and Rebates
Investment Tax Credit (ITC) is the federal solar tax credit that allows both residential and commercial property owners to deduct 26% of the cost of their solar panel installation from their federal taxes in 2020. This federal tax credit was originally instituted in 2005, set to expire in 2007. It has been extended several times since, and is currently set to expire in 2021. While the tax credit may be extended again, there is no guarantee.
The ITC only applies to property owners who own their solar system. However, other tax credits and rebates may apply on the state or local level.
Solar is Universal
Solar power is universal because even those living in low-light areas can take advantage of solar power. Those seeking solar panels do not have to be located in areas where the sun shines frequently. Solar energy systems can be installed and be effective in parts of the country where regular rainstorms are common.
When installing an effective solar energy system, the most important thing for people to remember is to ensure the system is properly positioned to absorb solar energy. Solar panels must be placed in high-light parts of the property, away from trees and objects in the landscape that could block the system from the sun.
Potential Drawbacks of Solar Power
In general, there are more advantages of solar power than disadvantages. However, it is important to understand that solar power is not the right option for every property or every owner. Before deciding if solar power is right for them, people should know the potential challenges associated with solar power, and have an understanding of their own goals associated with getting a solar power system.
Solar Panels Have High Upfront Costs
Solar power has always been expensive, although systems become more affordable over time. The current average price to install solar panels is about $19,000 before the federal tax credit.
Some people are able to manage this high up-front cost by leasing a system, although leasing has its own disadvantages. As already stated, ownership of the system is what qualifies the homeowner for the federal tax credit. Leasing locks the homeowner into a regular monthly payment, often for the life of the solar system.
Solar Panels Aren't Compatible With Every Rooftop
Most modern homes can accommodate solar panels. However, sometimes the material the rooftop is made from, and sometimes the structure of the house itself, is incompatible with solar panels. This is often true of older and historic homes. Historic Preservation Review Boards sometimes prevent the addition of solar panels if they are prominently displayed, while other review boards make concessions for these structural additions.
Solar panels can be installed on slate, clay, and wood rooftop shingles. However, the mounting method must be adapted for the type of roofing material the system is being installed on. Rooftops that are in poor condition may need to be repaired before solar panels can be installed. Weakened slate, for example, can be broken during the installation process.
Solar Panels Take Time to Reflect Their Savings
Because of the cost of solar panels and their installation, people who buy their system may wait about 7.5 years before they see a payback. Additionally, if someone chooses to install a solar system on their home and then moves before they start to see savings, they may not recover their money.
Finding and Comparing Solar Contractors Can Be Difficult
In some areas, solar contractors pop up frequently and disappear as quickly. Often, offers from contractors differ dramatically. Some contractors offer leased systems only, others may only sell, and still other contractors may have a mixture of packages for homeowners. Financing options make the process of choosing a contractor even more complicated, because payment terms may vary from one contractor to the next. These factors make comparing offers and systems challenging.
Some tips for finding a reputable contractor include:
- Know the licensing requirements in your state and ensure the solar contractor you choose meets those requirements.
- Meet with multiple contractors to compare bids.
- Get references from satisfied customers.
- Use online tools and resources to compare bids and make the process easier.
Planning a Solar Electric System
Before installing a solar electric system, it's important for people to plan properly, do their research, meet with contractors, and compare bids before committing to a system. They should know the questions they should be asking contractors, and familiarize themselves with the process so that they can be fully prepared in advance.
What Is the Home's Current Energy Usage and Needs?
During the evaluation process, solar contractors will need to know how much energy a home uses in an average month. Because energy usage may vary throughout the year, contractors may ask to see the owner's utility bills for the last year to see how energy usage fluctuates.
An energy audit can also be performed to assess a home's energy usage. An energy auditor will suggest changes that the owner can make to reduce how much energy their home or property uses. Changes made to a home's energy usage just before installing a solar panel system can change the solar system's needs. Solar contractors fit the system to the needs of the house, so homeowners should talk about any changes they're planning to make to their home that may reduce their home's energy usage. If someone is trying to save money on their system, they may choose to make changes to their home's energy efficiency before installing a solar system.
If possible, homeowners should plan to make these changes a full year before meeting with solar installation contractors. Making these changes early will ensure that the full effects of energy-reducing changes can be reflected in their utility bills, which in turn will give their solar panel installation contractor a tool that can help them gauge the best system for the home.
Does the Home Have the Potential for Solar?
Not all homes are a good fit for solar power. While it's true that this type of power can be used in nearly all regions of the country, if the property is located in the woods or surrounded by trees, then the constant shade may reduce the effectiveness of the solar system just enough that the cost is not worth the price.
Age and Condition of Roof
Roofing materials have a service life. Therefore, if a roof is old enough that it should be replaced soon, a solar panel installation contractor may suggest replacing the roof before installing solar panels. Additionally, the panels will need to be moved for repairs and re-roofing projects, which can increase the cost.
Homeowner associations and historic preservation societies often place restrictions on alterations to properties that may affect the appearance of the home. Those unfamiliar with their local HOA's restrictions on solar should read their contract or agreement before meeting with installation contractors.
Nearby Structures and Landscape Features that Shade the Roof
Landscaping features and large structures or objects that block the path of the sun can prevent solar panels from being effective. For large properties with areas of intense sunlight set away from the house, people may also install panels on the ground.
What Are the Options for Using Solar?
Solar is not a one-size-fits-all fixture. Community and shared solar, solar leases, power purchase agreements, and solarize programs are all options for homeowners and businesses to consider.
Leasing is one of the most common alternatives to purchasing a solar energy system. A solar lease is an agreement that exists between a solar contractor and a property owner. The contractor owns and maintains the solar system, and the property owner pays the contractor for the use of the system.
Solar leases are not a way to save money on energy, because the lease incurs a monthly cost, just like a utility bill. However, homeowners who are only interested in clean energy and who are not so interested in energy savings often turn to solar leases. Some homeowners prefer the lease rather than an outright purchase because system maintenance is included in the cost of most leases.
Leasing can complicate the home selling process because the home buyer must want the lease and be approved to take over the lease. Some home buyers would not be interested in leasing a solar system, while other home buyers may not be approved.
Power Purchase Agreement
A power purchase agreement (PPA) is an arrangement wherein a solar company installs an array on a property at no cost to the homeowner, and the homeowner purchases power from the array for less than the going rate for electricity from the power grid. The contractor maintains ownership of the solar array and performs all maintenance of the system.
While this type of arrangement is similar to leasing, it is not the same. For example, in a solar leasing situation, the property owner pays a fixed rate to rent the array from the solar leasing company. In a PPA, the property owner pays for energy itself, which can fluctuate based on the property owner's lifestyle, technology needs, number of people in the household, and so on.
A shared solar array is a single array that serves several homes or buildings. Shared solar is often considered for homeowners and property owners who want solar, but who are unable to install it on their home.
Sometimes, people turn to shared/community solar because purchasing a single system is unaffordable. Often, property owners turn to shared/community solar because they do not have an appropriate rooftop for an array. Shared or community solar may be a purchased or leased system; agreements are flexible based on the needs of the property owners.
Solarize programs are sometimes confused with shared and community solar, but there are significant differences. Whereas a community solar program consists of multiple property owners sharing one system, solarize programs allow homeowners or property owners in a community to enter into an agreement with one company to install solar panels on their rooftops, and as a result, get a bulk rate.
Solarize programs usually kick off with a campaign from the solar company. During the campaign, the company educates homeowners in the community about the benefits of solar power and how a solarize system can help them. At the end of the campaign, homeowners who are signed up get their solar array. The more homeowners who participate in the program, the deeper the discount.
Which Bids and Site Assessments Are Available from Solar Installers?
In recent years, solar contractors have become far more common, which can make selecting a proper contractor difficult. The North American Board of Certified Energy Practitioners certifies contractors. This certification gives property owners a way to measure the qualifications of the contractor they'd like to hire.
The NABCEP has established a code of ethics and standard of conduct to ensure that solar contractors engage in ethical and professional practices. Homeowners who hire contractors certified by the NABCEP can report violations and complaints to the board, which in turn can investigate claims and take disciplinary action if needed. The NABCEP has a search function on its website to enable homeowners to find board-certified contractors. Homeowners reviewing bids from contractors should be aware that all agreements with solar contractors are required to state the maximum generating capacity of the system being installed.
Are There Any Financial Incentives Available?
Small solar energy systems are eligible for a varying federal tax credit through December 31, 2021, but leases and power-purchase agreements are excluded. Other financial incentives vary by state.
To find out what the solar incentives are in each state, people may contact their state's department or agency of energy, or look up their incentives online. While some sources may publish a national compilation of incentives state by state, the best way to get the most accurate information is to contact a state's energy authority.
How Will People Work With Their Solar Panel Installer?
The installer will determine how many panels are required, where the panels should be installed, how the system should be oriented, what the tilt should be, how efficiently the system will convert energy, and what other electricity sources should remain available to power the home.
It is the homeowner's or business owner's job to review the contract, ensure the contractor is properly licensed and certified, and confirm that the cost of the system will fit their budget. It is also the homeowner's or business owner's job to produce all the information the contractor needs to verify that the solar array being installed will be adequate for the home's needs.
Solar Panel Cleaning and Maintenance
Once the installation process is complete, it's important for people to consider solar panel cleaning and maintenance. Cleaning a solar array may only be necessary in areas with heavy particulates in the air, and rain can sometimes be enough to naturally and safely do the work. People leasing a solar system should read their agreement with their contractor to find out whether their contractor will handle the maintenance.
How to Clean Solar Panels DIY
People who want to clean their own panels should only do so if it can be done safely. There are many contractors who will clean panels for a reasonable cost, and it is safer to hire someone who has experience and the proper safety equipment.
Before cleaning their panels, people should read the warranty or instructions that came with the panels to determine whether the panels require any special equipment or cleaning product. Next, people should consider sending a few pictures of the solar array to the contractor who installed them to determine whether a cleaning is even necessary. Most panels don't need to be cleaned very often.
Those who decide to go forward with the cleaning process should not scratch or damage the glass in any way, as this will reduce the panel's energy production. Unless otherwise directed by the instructions from the solar panel manufacturer, dish soap, warm water, and a soft sponge should be used to clean dirt from the panels. Isopropyl alcohol can help with any oils or sticky debris.
Solar Panel Cleaning Service
Cleaning services that specialize in solar array cleaning are equipped with the safety equipment and skills to clean and maintain rooftop units. Sometimes, installers can do this for an extra fee; if they cannot, people can contact one of these specialized companies to clean their array for them.
Consider If the Lease Includes Maintenance
Maintenance and cleaning may be an add-on option for leased solar panels. Some companies even include this service, while others only cover damages to the array.
Determine How Often the Solar Array Needs Cleaning
Solar panels don't need to be cleaned as often as one might think. A contractor can inform someone how often their panels should be cleaned.
Solar panels should not be cleaned because some standard dirt or grit has accumulated there. They should only be cleaned under extraordinary circumstances (the panels have become exceptionally dirty for whatever reason), and the contractor believes cleaning is necessary to maintain functioning.
Maintenance Over Cleanliness
Solar panels have few moving parts, so most systems need little maintenance over the course of many decades. Unless the panels are installed incorrectly, they're unlikely to need much repair. Sometimes, arrays can be damaged by hail, falling trees, and other debris carried on strong winds. Unless the system is hit by a fast-moving, devastating storm, it may be difficult to tell when something is damaged or broken. Electricity bills should be monitored, because the most obvious indication of a problem may be a sudden failure to produce energy.
The good news is that most of the time, solar arrays are often covered under good warranties. In fact, this is something else to look for when shopping for a solar array: a good warranty. Many warranties will cover the first 10 to 25 years, including the one part that's most likely to break: the inverter. If something does go wrong, people should contact their installer as soon as possible to get more information about how to proceed.
Is Solar Worth the Investment?
With a positive impact on the environment, a good return on investment when it comes time to sell a home, and savings on energy bills throughout the year, solar offers many rewards to property owners who invest in them. However, solar doesn't always make sense for everyone.
Once someone understands how solar works, what it takes to get a system installed in their home, and what the payment options are, they'll be able to decide for themselves whether solar is a good option. They should take time to explore the benefits and the challenges of solar, and of course, find the right contractor for the job. Working with a reputable and knowledgeable professional can help make the experience of installing solar in a home or business worthwhile.
If you are a landowner, you may be interested in making money from a commercial solar farm. Learn how you can view your property's solar worth for free here or read more about how solar farms can be a lucrative economic opportunity for landowners.