Is Solar Energy Actually Cost Effective?

Is Solar Energy Actually Cost Effective?

Is Solar Energy Actually Cost Effective?

There are many advantages of solar energy, one of which being the obvious positive environmental impact it makes to use renewable resources for everyday energy. But beyond that, it begs the question: Is solar energy actually cost effective?

Since 2000, solar has grown an average of 49% annually. In 2020, there are more than 90,000 solar installations from residential, commercial and utility locations, which has been helped by the falling cost of installation - more than 70% in the last decade.

But the overall cost of solar panels depends on individual factors. The system’s size, component type, labor, and local permitting costs are determined by your home and location, and tax deductions and local incentives may be available to lower the bottom-line price.

The Cost of Installation

Installing solar panels directly on your home or business’s rooftop can initially cost $15,000-$25,000 or more, depending on the size of the home or building and how many panels are needed.

While this seems like a hefty investment up front, using solar energy is a long-term investment. On average, the payback period for residential solar is 6-9 years, but using a solar panel system can ultimately save you thousands of dollars on your electric bill 20 or more years down the road.

Incentive Opportunities

Initially, you can save a large sum of money by taking advantage of government tax deductions available for installing a renewable energy source. In 2020, that federal tax deduction is at a rate of 26%, meaning that $6,500 of your $25,000 solar investment may be credited to your annual taxes. This deduction will drop to 22% in 2021.

Additionally, Santee Cooper offers a rebate program for installed rooftop systems, and other state incentives may be available to reduce the cost of getting started with solar energy on your property.

Estimating Solar Panel Efficiency

The first thing to find out before beginning your research into using solar energy as an alternative power source is the average power consumption in your home or business. Your usage can be found on your monthly energy bill, or a Santee Cooper Energy Advisor can help you. Your usage determines how much solar energy will need to be produced to effectively power your home or business, as well as what type of system makes the most sense for that production.

When you know what makes sense for your home or business, you can shop around for the best panels and contractors to install them. We have a vetted list of Trade Allies that meet Santee Cooper’s standards and requirements and also have the most updated information on program information. We recommend getting multiple quotes and opinions before making the purchase.

Options Without Installation

If your home or business isn’t deemed suitable for producing solar energy, or if you’re in a house, apartment or building that you don’t own and have the authority to install panels, there are community solar opportunities available.

Santee Cooper’s Solar Share program is about pooling resources to produce solar power on local solar farms to give more people the opportunity to benefit from using solar energy. Anyone who leases, moves, or just isn’t able to install rooftop panels can have affordable, clean power by purchasing a share of energy created from these community solar farms.

Consider What You’ve Learned

Ultimately, if you live in an area with sufficient access to sunlight and can afford the installation, or if you would like the opportunity to use community solar resources to offset some of that power generation, it makes sense to use solar panels as a cost-effective and environmentally friendly solution to generate power. Especially in the long run, the falling cost of using renewable energy sources will add up to big returns on your electricity bill and your outdoor environment.

Santee Cooper can always help you evaluate which solar panel option and how much solar energy is right for your home. Learn more at santeecoopersolar.com or reach out directly to solar@santeecooper.com for more information.

Author Santee Cooper

Santee Cooper

Santee Cooper is South Carolina's largest power provider, the largest Green Power generator and the ultimate source of electricity for 2 million people across the state. Through its low-cost, reliable and environmentally responsible electricity and water services, and through innovative partnerships and initiatives that attract and retain industry and jobs, Santee Cooper powers South Carolina. To learn more, visit www.santeecooper.com and follow #PoweringSC on social media.

Sign Up to hear from Santee Cooper