If you think solar is too expensive, you’re not alone. Most people still think of solar as a luxury item.
But the truth is, the cost of solar has plummeted in recent years. It’s now become so affordable that it’s growing the most among the middle-class.
This price drop has happened so fast, it’s no wonder so many people still aren’t aware of this change. But more Americans are catching on every day. We just passed 1 million solar installations in the U.S., and the next two years should get us to 2 million.
There’s never been a better time to go solar.
How much you’ll pay for solar
If you’re considering going solar, one of your first questions will probably be, What will it cost?
There’s no one answer to this question. The price depends on your location, the size of your system, and many other factors.
But we can give you some basic guidelines.
The way to assess a solar system’s cost is to determine the price per watt. These days, most systems range from $3.50 to $4.80 per watt. So if you’re quoted anything in that range, you can rest assured you’re in the right ballpark.
How do you figure out the price per watt? It’s simple! Whether you lease or purchase your system, you want to look at the cash price.
This is similar to what you’d do if you were leasing a car. First you determine the best cash price, and then you find a good deal on your lease based on that.
For solar, you take the cash price and divide it by the number of watts. A 2.5 kW (kilowatt) system is 2500 watts, a 5 kW system is 5000 watts, and so on.
So, let’s say you’re quoted a cash price of $20,000. (You want to look at the price before incentives, keeping in mind that the incentives will be the same no matter which solar company you go with.) If your quote is for a 5 kW system, the average system size in the U.S., that means it’s 5000 watts. So at $20,000, the price comes to $4 per watt. Right in the ballpark!
Can you get free solar?
You may have heard about “free solar” deals. A solar company representative will knock on your door and tell you they’ll put solar panels on your roof at no cost to you.
We all know there’s no such thing as a free lunch. But the good news is, you can get solar panels on your roof at no upfront cost, and start saving money right away. You do this by financing your solar with a lease, PPA, or loan. Check out our post on solar financing options for more details on these ways to go solar.
With leases, PPAs, and some solar loans, you can start saving on your electric bill on Day 1 — with no money down. This can be a great way to go solar if you don’t have the extra cash to buy your system outright. But it’s not exactly free.
How much you’ll save with solar
Just as with the cost of your system, how much you’ll save depends on a number of factors. The main ones are your electricity usage and the cost of electricity in your area. If you live in a place with high electricity prices, like California or Hawaii, you’re likely to save more with solar. Maybe you live in a hot climate and have to run your air conditioner a lot in the summer. You’ll probably save more than someone in a temperate area.
Your savings will also be affected by the financing option you choose. Over time, you’ll save the most if you pay cash for your system — just as you would if you paid cash for your house instead of taking out a mortgage. But if you opt for a solar lease or loan, you can start saving immediately on your electric bill.
A good rule of thumb is that if your monthly electricity bill is over $100, you’re likely to get good savings with solar. This number is coming down all the time, though — and like we said, your savings depend on more than one factor. If your bill is lower, it’s still worth looking into solar to see if it will work for you.
Is solar worth it for you?
We’d love it if we could give a simple answer to this question! Each family’s situation is unique, so there’s no answer that fits all.
We can tell you this: solar makes sense financially now for more people than ever.
To get a good estimate of what you can save with solar, contact a MyDomino energy savings concierge. Your concierge will run the numbers and help you determine if solar makes sense for you and your family.