Originally published on Cost of Solar.
It wasn’t that long ago that the dream of affordable home solar electricity was really just more for the upper class, and for the ultra-technical and early adopters. But over the last couple of decades, and in the last few years in particular, not only has the cost of solar panels dropped and their efficiencies have improved significantly, but new financing options, such as solar leasing, and solar incentives, have been boosting home solar more into the mainstream.
However, for the average person, solar power is still something that other people do – people that have more money than they do – and their guess as to what the costs of going solar is probably going to be way off base, so we still have a long way to go in getting the word out that solar is actually the affordable option, when viewed over the long run.
Perhaps one reason that solar is seen as more expensive than other home energy alternatives is that we’ve become accustomed to paying monthly bills for electricity, which can vary wildly depending on our electricity habits, and we see it as just another expense that we have to pay, year after year. When looked at monthly, perhaps those bills don’t seem like that much money, when compared to what we think the cost of going solar is.
But if we added up all of our monthly electricity bills for 20 years, and compared that expense (which can never be recaptured) with a similar financial investment in a home solar system that could not only pay itself back in short order, but could continue to produce energy for decades, it might shift how we think about solar power. Installing a home solar PV array may not be for everyone, in every situation, but for more and more of us, home solar is not only a clean energy choice but also an affordable energy choice.
A recently released report from the NC Clean Energy Technology Center, titled Going Solar in America, suggests that in almost every single one of America’s 50 largest cities, a typically-sized solar PV system offers a better return than the stock market, and for 42 of them, the cost of solar is already less than from their local utility.
“Right now, buying an average-sized, fully-financed solar PV system costs less than electricity from their local utility for 93% of single-family homeowners in America’s 50 largest cities, and in most places, is a better investment than many of the stocks that are in their 401(k).
Nevertheless, most people are unaware that solar is this affordable for people of all walks of life. We hope that this report will help to close this critical information gap and reduce soft costs.” – Jim Kennerly, project manager for Going Solar in America
For some people, going solar may be less of an affordable energy option and more of an investment option, and that will probably continue to be more so in the coming years. It’s already a viable option in 20 of the top 50 US cities, where if you can pay cash up front for a home solar PV system, then over the 25 year lifespan of that, you’ll have gotten a better return than investing your money in the stock market.
According to the report, these are currently the top 10 cities that offer the best financial value for solar energy:
1. New York, NY
2. Boston, MA
3. Albuquerque, NM
4. San Jose, CA
5. Las Vegas, NV
6. Washington, DC
7. Los Angeles, CA
8. San Diego, CA
9. Oakland, CA
10. San Francisco, CA
The report ranked the cities based on three metrics: (1) the average savings in first-year monthly bills, (2) the “overall present-day value of a long-term investment in solar” as compared to a stock investment with an average return, and (3) the levelized cost of energy generated by a rooftop solar system.
Various factors can influence the cost of solar in specific areas and cities, and solar incentives and/or net metering regulations will vary by the state or county, but in many of the most populated regions in the US, investing in solar is already a smart move.
Reprinted with permission.