Though prices of panels vary from place to place, studies show that the cost of buying and installing them is nearly 90 % lower than it was in 2010.
A lower price tag may be enough to attract some people. And the greater incentive comes from the fact that there’s a way to make money from them.
So if you’re interested, read on to learn how this can be done.
Do I save money?
Going to a solar power system is a major step towards a greener approach. One of the main advantages of installing solar panels is the reduction in the electric bill. So, yes you do save, but just how much you save is greatly influenced by where you live. The number of hours of direct sunlight, the angle of your roof, and the size of the panel all play an influential role in determining your savings. But the local electricity rate has the most impact. Before you can calculate your savings, you need to understand your expenditure.
Understanding the numbers
Every homeowner knows how important it is to manage the budget. Understanding how much energy and where it’s being used is the first step to comprehend how much you can save with a PV (photovoltaic or solar) system. Several factors affect your residential energy consumption. These include: the size, type, and age of your home, the number of people, the appliances you own, and how well your house is insulated.
On average, a typical household utilizes approximately 10,000 kilowatt-hours (kWh) of electricity in a year. Multiply that by the local electric rate to calculate the total cost for supply.
The local supply and delivery electric rate varies from place to place. For example, the average regulated price of electricity in Toronto in 2018 was 13.24 cents per kWh and in Vancouver, it was 11.42 cents per kWh. That’s just supply costs.
So the annual utility bill for costs would be around $1,324 and $1,142 respectively. Again is just for supply. Then there is the additional cost of delivery of the natural gas usually and electricity.
So those delivery costs can go for 10.5 cents per kWh.
Unfortunately, calculating the utility bill isn’t quite that straightforward. Since the price of electricity continuously fluctuates you can only calculate an estimated annual expense this way. Remember there are additional costs related to administration, transmission, and distribution that contribute to the final amount.
So is it worth it?
Knowing how you spend annually will help you decide what to do next. Most people understand that solar energy is not going to solve all of their energy needs. However, it will greatly reduce the amount of energy you need to buy. A typical residential solar panel array can produce 5kW, which can cover up to 75% of an average household’s electric needs. The remaining required power can be acquired through the grid.
Everyone knows that solar panels help to save on the utility bill. Because of the considerable up-front investment required in installing a solar power system, the ultimate question for almost all consumers is: “How long will it take to pay back the cost of installation?” On average, it may take between 7 to 11 years. But the payback period depends on your consumption and the price of electricity you purchase from the grid.
Will I still get an electric bill?
People often believe that once you invest in a PV system, you won’t receive a utility bill. Recall this, when your panels do not completely fulfill your electric needs, you use power from the grid. This usually occurs at night when the sun isn’t powering the panels or during winter when there are fewer hours of daylight.
The right way to invest in a solar power system
By understanding your yearly energy consumption, you will be able to determine your electric needs. This way you can specify the size of the solar power system that you should install. Employ the services of a professional solar installation company to calculate how many panels you will need.
Since positioning and installation are both tricky aspects of the trade, select a reputable company that has years of experience, preferably one that utilizes the Scoop site. By implementing the right skills and technology, you can expect only the best from them.
What are the benefits?
Many of you probably grew up in households with parents constantly reminding you to turn off the light. Before, this was a simple and effective way to lower the electric bill. But today, it’s a way to make money.
With the use of a solar power system, any electricity that you don’t consume is immediately set off to the grid. For this reason, those who reside in places with a considerable amount of sunshine find it beneficial to invest in solar farms. But for a regular homeowner, net metering is a method to make a profit of a PV system. If you are expecting to get a check from the electric company, this is not the way it works.
What is net metering?
Throughout the year, your PV system creates a varying amount of electricity, sometimes more than you need and not enough at others. These peaks and valleys in energy production influence your utility bill.
When the solar power system generates more electricity than you need, the excess is fed into your electric utility’s grid, and your meter actually runs in reverse. Your utility bill shows a credit based on the net number of kilowatt-hours you contributed to the grid.
On the other hand, whenever you’re experiencing a power deficit, you can draw the difference from the utility company. So whenever you use energy from the grid, you won’t have to pay extra as long as it’s the same amount or less than what you provided to the grid. This is known as net metering.
Can I really make money from solar panels?
When you receive your monthly electric bill, the usage and metering credits will be indicated. In fact, you may not have to pay anything. In general, most homes can build up significant credit during the summer. That’s when excess electricity is produced. But during the colder months, the cycle is reversed. As consumption exceeds production, the credit is eventually depleted during winter. This ebb and flow of solar energy are why houses remain connected to the grid. It ensures that your shortages are met while any excess you have is utilized efficiently.
Keep in mind that the rate you receive for credits is slightly less than the retail price of the electricity you generally pay. Even if you have a generous contribution, the utility provider is not likely to pay cash for the credits. However, most will allow you to donate them to someone else.
So the next time you’re thinking about a Christmas or birthday present, maybe you should gift them some of your electric credits!
About Michelle Joe:
Michelle Joe is a blogger by choice. She loves to discover the world around her.
She likes to share her discoveries, experiences, and express herself through her blogs. You can find her on twitter: @michellejoe524