When evaluating whether residential PV solar panels are worth the cost, there are 10 main factors you should consider as part of your cost-benefit analysis. Let’s dive right into it.
- Rapidly rising electricity costs
- Federal tax credits and local incentives
- Solar resource – global solar irradiance
- Ample solar exposure
- Net Metering rules
- You will need a new roof soon or you have a metal roof
- Home value appreciation
- High-efficiency solar panels vs. polycrystalline
- Energy storage for power access during blackouts
- Solar payback period
When Solar Panels May Not Be Worth the Cost:
- Limited sun exposure
- Middle-aged roof
- You might be moving soon
- Cannot afford a battery pack and no backup power generator in an area with frequent blackouts
- Stagnating or declining local real estate values
1. Rapidly rising electricity costs
Let’s face it, domestic electricity costs are rising rapidly across the nation, especially in Los Angeles, California where residential electricity rates have increased by over 10% from June 2020 to June 2021. Across California, prices have risen by 7% in the same time period.
There is no reason to expect that the rapid increase in electricity and home energy costs will be curtailed any time soon. In fact, with the rapid adoption of sustainability and ESG policies such as moving away from coal and fossil fuels, domestic energy costs are likely to continue to rise over the next decade, especially in states with limited natural resources.
A growing adoption of electric (BEV) and plug-in hybrid electric (PHEV) vehicles also puts an increasing demand on the electric grid and existing infrastructure. Expanding and upgrading the existing infrastructure to support rapidly rising number of BEVs and PHEVs on the road will likely continue driving up electricity rates over the next 5-10 years. – These dynamics are projected to accelerate as states like Washington, Oregon, California, and others incentivize or mandate policies that foster adoption of electric vehicles by 2030 and/or beyond.
If you are concerned about the rising electricity rates in your home state, then investing in a PV solar power system will help offset the effects of rising energy rates while also reducing or even eliminating your current electric utility bills.