Solar savings are a big reason why homeowners love buying solar panels for their home. It’s clear that home solar panels are a good long-term investment when it comes to saving money. In fact, the International Energy Agency declared that solar power is “cheapest electricity in history.” Currently, there are many incentives that help homeowners like you go solar and save in the process. That means when you switch to solar, you’ll experience significant savings over the lifetime of your panels.
Here’s what we’ll cover in this page:
There are plenty of reasons to purchase solar panels. We are going to go through a few of the most important reasons people are switching to home solar energy: growth, decreased prices, savings and sustainability.
Solar panels have significantly grown in popularity in the last decade. In fact, solar has experienced an average annual growth rate of 42% in the U.S., according to SEIA.
And in 2020 alone, solar power experienced a 37% growth.
Solar has also dropped in price over the last decade, and according to SEIA, by more than 70% over the last decade, leading the industry to expand into new markets and deploy thousands of systems nationwide
One of the major reasons for the massive growth of solar in the last decade is over concern for our planet’s resources. Fossil fuel energy is running out and the climate is getting worse. Government environmental policies have adopted a 100% clean renewable energy by 2035 in which solar energy is a large part of meeting this goal.
One of the first questions first-time solar homeowners ask is, “How much do solar panels save?” For starters, solar power offers protection from high energy rates and steadily rising electricity costs. When you have your free consultation, a solar specialist will give you a specific solar savings estimate based on your ideal solar power system size, monthly energy usage, appliance electricity usage and the kilowatt-hours (kw or kWh) you’ll want to produce.
Between your excess power and property value, there are a number of areas where you will see the solar savings make an impact on your bottom line. Not only do solar panels save you money on your energy bills, but solar incentives like the solar federal tax credit, net metering programs and federal, local and utility rebates make the initial decision to go solar easy and affordable.
Let’s start off with a caveat: how much you can save with solar panels can only be accurately assessed by a Solar Specialist.
However, for a point of reference, we’re going to go through an average situation for a homeowner in the U.S.
In terms of savings on solar panels, you can estimate how much your savings will be by understanding how much in energy costs you currently are paying. In the U.S., the average electricity rate is 13.19 cents per kilowatt hour (kWh) (as of February 2021). (1) According to the EIA, the average yearly electricity consumption for homeowners is 10,649 kilowatt hours (kWh), or an average of about 877 kWh per month.
If you do the math, that adds up to around $1384 in electricity bills each year. This means if you have a solar system installed that covers the amount of electricity your home consumes and added a solar battery for energy storage, you could avoid paying for energy for the entire life of your solar energy system.
Multiple factors involved in determining a number of Solar Panels required at your Home.
We have discussed in detail: How Many Solar Panels Do I Need?
Now find how much sunshine your home at peak hours gets with a handy tool from Google called Project Sunroof.
To understand an estimate of how many watts per hour your home will need to produce each hour using solar panels, multiply your hourly usage by 1,000. For a standard home, it’s about 1,250 watts per hour.
Another factor determining how many solar panels your home needs is what your home energy goals are. For example, if your goal is to completely cover your home energy use with solar energy, you’ll need more solar panels as well as battery storage to hold the excess power for the night. If you’re looking to cover only a partial amount of your home energy use, you’ll be able to have a smaller system installed.
The other major factor in how many solar panels you’ll need has to do with the type of solar panels you choose. The quality of a solar panel, the materials used and the brand makes a huge difference on how much energy your panels produce.
First of all, you’ll need to know how much electricity your home uses. This is a big factor in determining how many solar panels you’ll need. The more solar panels, the more electricity they will be able to capture for your home use. You can determine this by looking through your past utility bills and finding your home’s hourly energy needs.
If you need help with these calculations, be sure to set up an appointment with a Solar Energy Specialist. Find the ‘kilowatt hours used’ number and get an estimate by dividing the number of days or hours within that time period. For example, if it shows a 30 day time period, divide it by 30 to get the daily usage and then by 24 to get your hourly kilowatt hour (kWh) usage.For reference, in 2019 the average homeowner consumed about 877 kWh per month. This is around 30 kWh per day and 1.2 kWh per hour.
You can find out how much energy you can expect your solar panels to produce by knowing about their efficiency. This is a measurement of what percentage of sunlight your panels can turn into energy. Most solar panels are between 14% and 20% efficient. For maximum savings on your home energy costs, it’s best to go with solar panels that have 20% efficiency and above. Each percentage makes a large difference in how much more energy your panels will likely produce.
The efficiency of the solar panels have a lot to do with how many solar panels you’ll need. To find this out, multiply the peak hours of daylight your home gets by the hourly average wattage your home gets. Next divide that number by the wattage on the solar panels to find an estimate of how many solar panels you’ll need.
For example, with 355W panels on an average home, you’ll need around 17 panels versus panels that are 250W in which you’ll need around 25 panels.
Another caveat: one reason it’s good to talk to a Solar Specialist is because this varies widely especially if you’re considering a battery in which you’ll be able to store excess energy for later use, like when the sun is not shining.
For your particular needs you’ll want to schedule an appointment with a Solar Specialist who can go through all the factors for your particular situation. You can start by doing the calculations we’ve already mentioned. But when it comes down to all the incentives available to you and figuring out your exact home energy goals, you’ll want to discuss it with a professional. Be sure to have previous energy bills available as well as your home energy goals.
Again, this answer varies widely depending on all the factors at play. The initial price minus incentives as well as if you financed them can heavily influence this. However, for a very typical situation in the U.S., the average payback period if you’ve financed a solar system is between 9 and 12 years. This means that all the solar energy your panels produce after this is completely free. And if you have a solar battery and a well planned out solar system installed, you can expect to see $0 electricity bills for a typical situation.
