How Much Does it Cost to Run a House on Solar Power?
The average house in the U.S. uses approximately nine hundred kilowatt hours (kWh) per month, or about eleven thousand kWh per year. By analyzing your electricity bill, you can estimate how much energy you can produce from solar panels. A three-kWh solar panel system can produce between three and six thousand kWh per year. A five-kWh system can produce between six and eight thousand kWh, and a ten-kWh system can produce anywhere from sixteen to twelve thousand kWh annually.
Cost of solar panels
The average cost of a residential solar panel system has fallen from over $45,000 in 2010 to around $17,000 today, and that does not include the 30% federal tax credit available through 2019. Once you factor in the personal savings you will get from the tax credit and the many benefits of owning your own solar system, the cost of solar panels is relatively inexpensive, although the panels themselves can be pricey. You should also make sure that your solar panels come with a strong manufacturer’s warranty.
The typical price of a solar panel is between $17,161 and $31,814 for a three-kilowatt-watt system, excluding labor and installation costs. The installation and labor costs will add another ten percent to the overall cost. These costs vary by location and are estimated to be between 15% and 30% of the total cost of the solar panel system. As an example, solar panels in California cost $2,347 per kilowatt-hour, while those in Arizona cost more than six times that.
Cost of inverter
If you want to run a house on solar power, you will need an inverter to convert the energy from your panels into usable electricity. There are several different types of inverters available, and their prices vary widely. A string inverter costs about $100, while a microinverter costs $1,000 or more. String inverters can be sized to fit multiple panels, but they will have to be connected to the inverter to be used. Microinverters are more expensive than string inverters and must be installed on every panel, so you can’t just double your solar panels and expect to save money.
When you are figuring out how much money you need to budget for the inverter, make sure to look at the overall cost of the installation. Many inverters will account for eight to nine percent of the total cost, which might be too high. However, your other construction costs may be much lower, so a higher percentage of the overall cost is still a good thing. In any case, you should carefully read the specifications of your inverter before committing to it.
Cost of labor
Labor costs vary depending on region and state. Some regions have higher sunlight hours than others, and solar panels tend to cost more in those areas. Monocrystalline panels are more expensive than polycrystalline ones, and monocrystalline panels are necessary if your house has limited roof space. Larger solar systems require more equipment and labor, but you can expect to save thousands of dollars in the long run. If you want to run your house on solar power, it’s important to compare local installers’ prices to national brand installers.
The cost of installing 10 solar panels ranges from $2,500 to $6,000 on average. This price does not include batteries, framing, or inverters. The wattage of each panel affects the overall cost. Higher-wattage panels tend to cost more, but they generate more energy. A typical solar panel can produce 250 to 600 watts. To determine how much solar panels cost, ask the solar installer how many you will need for your home.
Return on investment
The return on investment (ROI) of running a house on solar power depends on several factors, including average electricity costs, the amount of insolation in the area, and the cost of installing a PV system. As the ROI increases, the full value of solar energy becomes evident. A solar-electric system costs around $13,000 in Charleston, S.C., but government incentives cover up to 65 percent of the cost. Over a 20 to 25-year lifetime, an average solar-electric system will save about $45,000 in electricity bills.
Calculating the IRR of running a house on solar power is straightforward when using modern spreadsheet programs, such as Google Sheets or Excel. To get an accurate figure, divide the cost of the solar panel system by the total annual savings, such as the electric bills. Divide this number by the estimated ROI for solar-panel installation. You should subtract the cost of the system, as well as any upfront incentives, from the initial cost of the system. You should then get the net savings, which is the savings in electricity bills over the years.