With the 30% federal tax credit for home solar installations ending Dec. 31, many people have been left wondering whether installing solar panels on their homes is still worth it, even if they can't meet the deadline.
The short answer, according to an energy expert, is yes. Although 30% off the cost of a solar installation does represent tremendous savings — and helps homeowners pay off the cost of home solar sooner — the math is still strongly in most homeowners' favor, even without the tax credit.
This is especially true given the skyrocketing price of electricity recently throughout the U.S.
"We're entering this era where electricity prices are almost certainly going to rise across the country," said Michael Thomas, founder of Cleanview, which tracks clean-energy trends, per EnergySage. "They've already risen as much as 30% in a year in a state like Maine recently, and we're looking at electricity price increases of 10%, 15%, 20% across most states this year."
Paying off the initial investment of a solar installation might take a bit longer without access to the 30% federal tax credit. According to EnergySage, that time span, on average, is expected to increase from seven to 10 years.
However, when considering rising electricity costs, as well as the fact that solar panels come with a 25-year warranty and can often last as long as 30 years, the math still comes out strongly in favor of home solar. Even if it takes 10 years to pay off the upfront costs of home solar, that still means 15 to 20 years of essentially free electricity.
"In some cases, you might be surprised if you see electricity rates are going to rise 10% every year for the next five years and then calculate how much you might save with solar," explained Thomas, according to EnergySage. "It might look really good."
With or without federal tax credits, EnergySage simplifies home solar installation with free, easy-to-use online tools. For example, its powerful mapping tool allows you to see the average price of a solar installation in your area as well as what rebates and other incentives are available in your state, saving customers up to $10,000. EnergySage also lets you easily compare quotes from pre-screened local installers.
Save $10,000 on solar panels without even sharing your phone number Want to go solar but not sure who to trust? EnergySage has your back with free and transparent quotes from fully vetted providers that can help you save as much as $10k on installation. To get started, just answer a few questions about your home — no phone number required. Within a day or two, EnergySage will email you the best local options for your needs, and their expert advisers can help you compare quotes and pick a winner. |
To push the cost savings and environmental benefits of home solar even further, you can combine solar panels with energy-efficient electric appliances such as an induction cooktop or heat pump. Heat pumps, in particular, can save you as much as $400 per year on HVAC costs. To learn more about heat pumps and to figure out which affordable option is right for you, check out Mitsubishi's free website.
If you are interested in home solar but the upfront costs don't fit your budget, Palmetto can help with its innovative LightReach solar panel leasing program. For no money down, LightReach lets you lock in low energy rates while also getting all the same environmental benefits of solar panel ownership.
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In the city 🏙️ In short, while the 30% solar tax credit offered homeowners tremendous savings, missing the Dec. 31 deadline does not mean that you should give up on installing home solar. With electricity prices expected to continue to increase significantly in the coming years, solar can still be a great deal for you and your family.
Additionally, many states are stepping up their efforts to make solar installations easier and more affordable.
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"This year, Texas and Florida passed bills to make it much easier to install solar panels, and that's good from both the consumer experience — you don't have to wait as long, you don't have to do as much paperwork — but most critically, it's going to drive down these so-called soft costs of solar," said Thomas, per EnergySage.
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