5 Frequently Asked Questions About Solar Power Systems
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5 Frequently Asked Questions About Solar Power Systems
If you’re looking to make a home improvement that increases your home’s value and saves you money overall, consider a solar energy system. Solar energy systems harvest clean solar energy through panels installed on or near your home. As a result, solar energy systems lower your monthly electric bills and your carbon footprint, while increasing the value of your home. If you’re thinking of going solar, here’s everything you need to know to get started.
Are There Funding Options for Solar Power?
Yes. Some states offer funding options for solar power. Although, they cost more than paying for it out of pocket or with a traditional loan. This option may or may not be suitable for your budget.
If you want to own your solar energy system and not lease it, use options such as power purchase agreements (PA) or solar loans to break the cost into more affordable monthly installments. In addition, new homeowners can add solar energy to their home’s purchase price through companies like Fannie Mae or the Federal Housing Administration.
Do I Need Permissions To Install Them?
Yes, you need permission before installing solar panels or solar energy systems — and you may need permission from more than one organization. Firstly, you’ll need permission from your local government, which you obtain by applying for a permit. Next, check with your Homeowner’s Association or similar neighborhood association. Many states like New York require The Department of Buildings to inspect solar installations if they need a permit. Most states also require your solar energy system to be installed by a licensed plumber or electrician. Some governments narrow this down further to certified solar installers only. You can, however, install panels yourself, just not the system.
If you choose to install your solar energy system without getting permission, you might be fined or forced to have the system removed. If you're looking to save money or future headaches, it's best to obtain the proper permits.
How Much Money Can I Save With Solar Panels?
On average, solar electric systems cost $20,000 to install. This figure includes hardware, panels, and labor. However, the price could fluctuate depending on where you need your panels located. The more inaccessible the spot, the higher the cost.
There are a few things that factor into how much you save with solar panels. They include:
- How much power you use
- If you own or lease your system (owning your system saves you more money)
- How much power your system generates
- The electricity rates set by your utility company
- How much excess energy gets sent back to the grid
To estimate how much your utility company charges for electricity, check the electricity rates in your area using the National Utility Rate Database.
Will I Receive Any Tax Breaks?
Solar energy makes you eligible for the Solar Investment Tax Credit, passed by Congress in December of 2020. This act provides a 26% tax credit for systems installed between 2020 and 2022 and 22% in 2023. But hurry, this tax break ends in 2024 — if Congress fails to renew it.
Certain states not only give you tax breaks for going solar, but they also help with the costs. N.C. Clean Energy Technology Center (DSIRE) put together a comprehensive database with everything you need to know about solar power tax breaks in your city and state. All you need to do is go to DSIRE and type in your zip code. Once you do, you’ll find a list of programs to match your solar needs and their contact details.
Note: If you lease your solar energy system instead of buying it, you will not be eligible for the tax credit.
Will Solar Panels Increase My Property’s Value?
Many additions add significant value to your home, one of which is the addition of solar panels. Solar panels are considered upgrades, much like an extension or an extra bathroom. According to Money, solar panels increase your home’s value by 4.1% on average no matter where you are in the United States. Enough people are investing in solar panels that we currently have enough energy to power 23.3 million homes!
If you’re wondering how much your home’s value would increase with a solar power system, the U.S. Department of Energy estimates $15,000 (if you install an average-sized solar power system).
There are many more perks to installing a solar energy system, but these are the most beneficial. First, to save as much as you can, find a way to pay for your system upfront and have your system installed by a licensed professional. This keeps you from adjusting the shoddy handiwork of an unlicensed contractor in the long run. Lastly, purchase your system during the spring or fall when prices are lower for installation. Having your system installed in a ‘wet’ season could prolong the installation process.
Are you thinking about installing a solar energy system for your home? Let us know in the comments!
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