When we talk about solar panels, we often think about environmental friendliness. Its benefits and savings. But can you really save money with solar panels? We will deal with situations such as purchases, Solar Panel Lease, and Solar Power Purchase Agreement (PPA).
Can You Save Money On Your Electricity Bills By Buying Solar Panels?
It would seem that everything is simple here. You need to calculate how much is necessary to spend on electricity from utilities per month or year and compare it with how much it will be necessary to spend on energy with solar panels – ideally, nothing. But! There are several criteria at once that allow us to assess the economic feasibility of switching to electricity:
- Region of residence – how many hours of sunshine per day, week, and month in your region;
- How much do you pay for electricity now – tariffs in different cities are different and may even differ significantly;
- How much energy you consume – depending on where the system will be installed – home, farm, or business.
Here are some examples from the data that were presented in 2022. In Arizona, the tariff is $0.13 per kWh. At the same time, the cost of the solar system, together with the installation, is $10,672. Now take California, where the electricity tariff is $0.28, and the solar plant costs $12,751 to install. But the savings over 25 years will be $73,985. Do you really save money with solar panels? Of course, yes, it’s obvious. Over time, the cost of batteries will decrease due to new technologies. This will lead to even greater savings.
Now you know how much solar panels save. But what if you cannot buy panels? You can rent them.
Can You Save Money On Electricity Bills By Renting Solar Panels?
Renting solar panels, in fact, is no different from renting, for example, a car. Panels are installed on your roof, but they do not belong to you. The question arises, how much do solar panels save? This will largely depend on the amount of energy you need. But the advantages of renting are obvious:
- There is no need to spend money on buying panels and installing them;
- All responsibility for the maintenance of the panels lies with the owner company;
- You can purchase your panels at a bargain price at the end of the rental period.
So how much money can I save with solar panels? It’s impossible to say for sure at once. You need to sit down and calculate what electricity bills come in every month and what rent the owner company causes. The difference between these amounts will be your savings. But it is also worth considering that the landlord will raise the cost every year, as it is his right, and from inflation, electronics prices, and the increase can be within 1-5% of the amount.
Do you save money with solar panels through an equipment lease? Then be prepared for the fact that the value of the property does not increase. If, for example, you decide to sell your house, then with installed panels and complete autonomy from external power grids, you can count on an amount much higher than without them.
If you have a lease signed and you want to sell the house, then the buyer may ask you how you save money with solar panels. Give specific examples. You may be interested in the future owner because houses with their own batteries are much more expensive. And if your batteries are rented, new homeowners can simply renew your contract.
Is It Possible To Save Money On Electricity Bills With A Solar Energy Purchase Agreement?
Do not confuse a solar energy purchase agreement (PPA) and panel rental. The only thing they have in common is that the panels installed will not belong to you. If, in the case of renting, you pay only a fixed rent for rent and, of course, an additional bill from utilities in case of energy overruns, then with PPA, you pay the same electricity bills as usual, but at a more favorable rate. And the bill comes not from the utility but from the company that owns the batteries.
But how much savings does it give? We can give an example of abstract amounts so that you can understand if solar panels save money. For example, your tariff from a utility company is $0.15 per kWh. Your household consumes 1,000 kWh per month, which means you pay $150 in bills.
Another example is that you have panels on your roof that do not belong to you. The company that owns them sells you electricity for $0.1 per kWh.
Therefore, the monthly savings with solar panels is $50. Over twenty years, you can save $12,000.
At the same time, you do not spend money on installing the system and its maintenance.
At the same time, you do not spend money on installing the system and its maintenance. However, if the panels do not physically belong to you, then you cannot count on benefits from the state.
Some companies, at the conclusion of the PPA, offer to save money with solar panels all year round. That is, to cover the shortage of solar energy in winter due to its overproduction in the summer months. Such a condition is prescribed in the contract, and it is possible only if, during a period of high solar energy, the panels generate more electricity than the household uses.
Use Of Solar Energy In Communities
This practice is spreading more and more in different states. A community of owners of housing, office, and household facilities is being created. They want to use solar energy, but they can’t for a number of reasons – roof structure or building layout, shading, etc., does not allow it. In this case, such a community initiates the installation of a station on its own territory or outside its territory under an agreement and feeds its houses with this energy.
Similar shared solar station systems are being developed for apartment buildings in cities and towns. How electricity is distributed, in this case, how many loans each member of the community receives for its use, is decided individually.
It is impossible to say how much money you save with solar panels. Each case must be calculated separately. A farm, in terms of buying or renting panels and PPA, can receive different benefits. Will I save money with solar panels? Definitely yes. But it’s hard to say what exactly will be more convenient and profitable for you. It is better to entrust the calculation of each option to professionals and also consider all the advantages and disadvantages of each possibility described above.