Although the environmental benefits of solar energy are excellent, most people tend to
determine whether or not solar energy is right for them based on how much money it’s going to
cost them.
While costs have dropped significantly over the past few years, people still need to be able
calculate their return on investment to determine whether or not the money is worth spending.
To give you a better idea of what you’re looking at for your investment, we’ve put together this
guide to ROI on solar energy.
Calculate Your Tax Credit
Too many people still don’t know that there are massive tax credits available to those who
decide to install solar energy in their homes. There are massive tax credits at the federal level,
but there are also different credits available from state to state. To be able to calculate your ROI
effectively, you first need to know exactly what tax credits are available to you. It’s also
important to remember that the potential tax credits are going to be decreasing in value in future
years.
Know Your Net-Metering Policy
In addition to knowing the tax benefits available to you, it’s also important that you know the net-
metering policy in the state in which you live. The net metering policy determines how much
credit you get back for producing extra energy. When your system produces extra energy to put
back into the grid, you’re often eligible to receive credit for that energy.
Know Your Current Utilities
Although it should go without saying, many people don’t actually know what they’re currently
paying for regular electricity. To be able to calculate your ROI on solar energy, you first need to
know exactly how much money you spend per month and year on traditional electricity (and how
those rates are going to change in the future). The more expensive the utilities are in your area,
the more money you’re going to be able to save on solar energy.
Know The Best System For You
Although most solar energy systems are installed on the roofs on homes, not all homes are able
to accomodate a system on the roof. It’s important for you to know both where your system will
be installed and which type of solar system will be best for you. If you don’t need the most
expensive type, you know that you’ll be able to put that money back in your pocket.
Choose The Right Installer
The rise of solar energy has also brought along many poorly run companies looking to make a
quick buck. When calculating your potential ROI, know that choosing a poorly run company
could end up throwing off your numbers down the road if you have to replace expensive parts or
if your system doesn’t end up functioning the way that it should.
If you follow these five simple tips, you’re going to end up with a more efficient solar energy
system that saves you a lot of money, and you’re also going to be able to calculate your
potential ROI much more efficiently.
If you have any questions or thoughts, feel free to leave them in the comments section below!
