The ads are out there, as are the offers to have solar panels installed "at no out of pocket cost. One company or all advertising under that one name, I don’t know. Has anyone taken that offer recently, and if so, what is your opinion of he product and service? TIA
RayB
Depends where you live and if it is practical for you (at your location) AND the electric company rates.
A friend did not do the “free” one because it was not available some years ago. As part of a city/neighborhood project, 10-20+ households all had it done on their individual houses maybe 4-5 yrs ago. They each paid for their individual house and got a discounted bulk rate. Payback was maybe 14 yrs then. Now it has dropped to 12 yrs (from new, as electric rates have gone up). The group likely has about 8 yr more years until the benefits pay back the original cost to each of them. Then it is a substantial cash payback every year thereafter (lower electric bills, some summer months can be about $0). This makes a plug-in car (all electric or hybrid) more financially appealing. The car charging panel needs to be added by an electrician, but the ongoing cost of power is somewhat offset by the power generated by the solar panels.
I’ll be following here, but you should definitely ask the same on ‘Building/Maintaining a Home’ https://discussion.fool.com/building-maintaining-a-home-100167.a…
The ads are out there, as are the offers to have solar panels installed "at no out of pocket cost. One company or all advertising under that one name, I don’t know. Has anyone taken that offer recently, and if so, what is your opinion of he product and service?
It is almost certain that what those companies advertising will offer you, you will be better off buying a system - even if you have to do a loan from your local credit union to do it.
Most likely they are offering a “power purchase plan” or a “solar lease” - which is always a worse option than buying the system outright - especially if there is any chance that you might sell the property during the 20 year contract.
There are a lot of variables that enter into how beneficial it is to install a solar system - your location, your power company rates, cost to install the system, whether you have “net metering” and if so, how that’s calculated.
But most likely you’ll get some small benefit if you go with the guys advertising. (And they’ll get much more benefit)
And if you do more research and buy a system from someone else, who isn’t spending a bunch on advertising, you’ll get a much larger benefit.
I’ll second the advice that on the “Building/Maintaining a home” board this would not be off-topic.
Calculating the payback period for solar panels is difficult because of the many factors involved (some of which are unknown and unknowable) so I tell people that they’re better off not bothering and instead use some rules of thumb.
Take the retail value of the panels, then subtract out any credits, rebates, etc. to get your actual “out of pocket” cost. Data show that solar panels increase the sale price of a home by about 4% or $6,000/KWH. Calculate it both ways and compare to the out of pocket cost. If both are higher, then congrats – your system added enough value to your home to offset its cost and all the money you save each month is a great bonus. If it’s lower, estimate your monthly savings and see how long it takes to make up the difference.
Data show that solar panels increase the sale price of a home by about 4% or $6,000/KWH.
I wish.
$6000 / KWH would mean my system which produced 12151KWH last year added $72M to my home’s value.
Even if you meant $6k/ KW, it’d mean it added $54K. That’s more than I paid for the materials. (heck - that’s more than I would have paid to have someone install it)
12151kwh at $0.10/kwh means ~$1200 per year lower utility cost for me.
Calculating the payback period for solar panels is difficult because of the many factors involved (some of which are unknown and unknowable)
There’s factors that are unknown and unknowable - but that doesn’t mean that you can’t make an estimate that’s good enough to make a decision.
It doesn’t have to be perfect - just good enough. If something unusual happens that significantly changes the payback (like the power company lowers rates by 80% because aliens just gave us technology that provides nearly free power) - well those kind of risks are just something you just accept.
My estimates when I was doing the research for my system came out pretty close. They weren’t perfect. And if the utility changed rates they could have been farther off. But they were good enough that I was well within 20% of my estimates. And I think most people can do an estimate that will be within 20% - which is probably good enough.
Data show that solar panels increase the sale price of a home by about 4% or $6,000/KWH.
I wish.
I read it as $6000 per KW of label capacity of the array. Still seems like a rather arbitrary number to me. And a bit large.
I think you can get a 6 KW system installed for something like $20k net of the current tax credit, which works out to less than $4,000 per KW. No way does that add more than the cost of the system to the home. Perhaps there is a bit of value to having a system already installed and the hassles of selecting a vendor and going through the installation process. But I really doubt that particular value is half the cost of the system. I’d put it at no more than 10% of the system cost. The hassle of installation isn’t that bad, certainly not when compared to any kind of remodel or room addition. And the hassle of selecting a vendor is as hard as you choose to make it. Many will do just fine getting three quotes and blindly going with the middle bid.
Personally, I discount any idea of it adding value to a house. Solar components themselves are useless. The only measure of their value is how much electricity they can produce over their lifetime. A system near the end of it’s life is close to worthless, and may even have a negative value if you consider the cost to remove it. A system just a year or two old is probably worth roughly its installation cost.
But the real worth is in the electricity the system is expected to produce over it’s remaining lifetime, less the expected repairs and maintenance over that lifetime.
–Peter
I think you can get a 6 KW system installed for something like $20k net of the current tax credit
6kw system should be $18K or less - before tax credits.
So $13.3k after adding in federal credit. Less if you have a local credit.
A system near the end of it’s life is close to worthless, and may even have a negative value if you consider the cost to remove it.
What is the “end of it’s life” for a solar system though?
Some people use a 20 or 30 year life.
At 20 years the panels should be producing ~90% of what it produced in year 1.
The inverter may need to be replaced (or may be needing it’s second replacement soon)
If it’s still doing 90% of it’s production, is it really “end of it’s life”?
I don’t think so.
So even at year 20 or year 30, I don’t think it’d be a negative value.
OTOH, a solar lease or power purchase agreement - that’s a negative impact on the house resale value right away and continues to be a negative until the contract is bought out.
But the real worth is in the electricity the system is expected to produce over it’s remaining lifetime, less the expected repairs and maintenance over that lifetime.
I agree.
What is the “end of it’s life” for a solar system though?
Some people use a 20 or 30 year life.
At 20 years the panels should be producing ~90% of what it produced in year 1.
The inverter may need to be replaced (or may be needing it’s second replacement soon)
If it’s still doing 90% of it’s production, is it really “end of it’s life”?
I don’t think so.
So even at year 20 or year 30, I don’t think it’d be a negative value.
Somewhere between year 20 to year 30, the house will likely need new shingles. The solar panels will need to be removed. At that point, you’re not going to reinstall the old panels. For me, they would have a negative value.
PSU