What You Should Know Before Buying a Solar System for Your Home
Before buying a residential solar system, make sure that you understand the contract. Most solar systems are intended to remain on your home for 20 years or longer. Generally, residential solar systems come with long-term contracts, such as PPAs or leases. But, if you plan to move, you should find out how you can transfer your contract. Make sure you understand everything that the company tells you matches what’s in your contract.
Costs of solar panels
The average costs of installing solar panels for your home vary from three kW to 10 kW, depending on the size of the home, location, and energy consumption. The costs listed below include 30% of the solar investment tax credit, as well as any additional local, state, and utility incentives. The larger the system you select, the higher the initial cost. Then, you can add-on additional panels or modules to reduce the cost of the system over time.
If you’re interested in owning a solar panel system for your home, you have several financing options. Most states offer exemptions for certain solar equipment. You can also lease the solar panels and reap the financial benefits. But before you buy solar panels, you should know how much they cost. The costs can add up fast. Fortunately, you don’t have to pay the whole cost up front, and you can transfer the loan to a new tenant.
Efficiency of solar panels
There are many benefits of installing a solar panel system on your home. Depending on the state you live in, the efficiency of solar panels can drastically reduce or completely eliminate your electricity bill each month. The more sunlight you receive throughout the year, the more energy your solar panels can generate. To find out if your state benefits from solar energy, visit the EIA website. You can also check electricity rates by state by looking up the latest prices.
When you buy a solar system for your home, you will be able to take advantage of the net metering program. The utility company will credit your account with the amount of energy you produce. When you buy a system that has an annual production of 1,000 kWh, the solar panel system should be sized to offset your entire annual home electricity use. It is possible to overproduce by a lot, which means you will end up with large credits in one year. Net metering enables you to keep track of these credits over the years and will help you make a quick payback on your investment.
The federal government offers a tax credit for solar energy purchases on residential systems. The credit can total up to 26% of the net cost of your solar system, provided you have a current tax liability. The credit can be carried forward for up to five years. You can claim your tax credit only on the solar equipment you purchase – not on systems that you have already installed. However, it’s worth noting that the amount you claim for a solar tax credit depends on your individual tax liability.