How to Get the Most Savings from Your Solar Investment

Renewable energy is a big investment, and learning how to make the most of your solar panels will ensure maximum savings and a faster return on your upfront costs. Although solar panels provide passive energy generation, they function best when you take actionable steps to boost performance. Reaping the highest possible savings requires a multifaceted approach, including strategic purchasing, long-term maintenance, and navigating the application process for various grants, credits, and rebates. 

Ready to learn how to save with solar? Join us for our top solar savings tips to help you recoup your costs as quickly as possible. 

Solar Savings Tips: The Importance of Maximizing Your Solar Investment

Solar panels offer substantial long-term savings that start accumulating as soon as your system is up and running. They don’t simply provide a single path to savings. Instead, a renewable energy system can put cash back in your pocket in many ways, including:

• Lower utility bills: Offsetting your energy consumption with clean solar energy can slash your monthly utility costs.
• Net metering programs: Sell excess energy back to your utility provider in exchange for credits on future expenses.
• Solar Renewable Energy Certificates (SRECs): Sell SRECs to corporations looking to offset their carbon emissions. 
• Federal tax credits: The federal Solar Tax Credit offers up to 30% off the costs of a solar panel system.
• State-sponsored incentives: Sales, use, and property tax exemptions may be available to further reduce initial costs. 
• Increased property value: Solar panels can boost property values by as much as 10% over comparable grid-dependent homes. 

Financing Options for Solar Installations

Just like buying a car, most people don’t pay cash for a solar panel installation. The financing method you choose can help you get the most from your solar panels. 

Exploring Different Financing Methods

Choosing to purchase or lease your solar array will impact your long-term savings. Here’s how these two options compare: 

Solar Loans

With a solar loan, you borrow the money to purchase your array, paying it off in monthly installments. This arrangement gives you all the benefits of ownership, including federal and state tax incentives and increased property values. You’ll begin saving on utility bills as soon as your system begins generating clean energy, leading to substantial long-term savings. Additionally, you’ll have complete control over your array, with the flexibility to add more panels and enhance your battery bank over time. 

The downside of purchasing a solar panel system is that you’ll incur higher upfront costs and may have to meet certain credit requirements to qualify for a loan. 

Solar Leases or Power Purchase Agreements

If you choose a lease or power purchase agreement (PPA), your solar company will install an array on your roof at no cost to you. Instead, you agree to pay the company a fixed rate for the energy your system generates. 

By locking in lower rates, you can save on monthly utility bills and support the environment at the same time. However, you won’t be able to claim tax incentives that make purchasing solar alluring to many. You may also encounter complications when selling your home, as potential buyers might hesitate to enter into an existing lease agreement for a system they’re unfamiliar with. 

How Financing Impacts Overall Savings

While solar leases and PPAs don’t require significant upfront costs, lessees will continue paying monthly fees throughout the duration of the lease agreement. Over time, these payments can eat into the savings homeowners could enjoy by purchasing their array outright. When you buy a solar panel system, you can expect it to pay for itself in less than 10 years. In fact, many homeowners who purchase see a return of 125% within five to seven years, and up to 500% after 20 years. Once you’ve recouped the costs of your initial investment, you’ll enjoy years of enhanced savings. 

Government Incentives and Rebates for Solar Energy

One of our top solar savings tips is to make the most of all available financial incentives when installing an array on your property. Federal and state-sponsored financial incentives can provide substantial discounts and rebates on renewable energy systems. Keep in mind that these refunds typically only apply to purchased systems, not leased arrays. The federal Investment Tax Credit is a popular program offering rebates of up to 30% off the initial costs of qualifying solar energy systems. These rates will continue through 2032, dropping to 26% in 2033 and 22% in 2034, so you won’t want to delay your investment. 

Depending on your location, you may qualify for various state-sponsored incentives, including property tax exemptions, clean energy grants, and other rebates to make renewable energy more accessible. 

An experienced solar installation specialist can help you navigate the world of solar rebates. A local expert will have in-depth knowledge of the programs available in your area, eligibility requirements, and the documentation needed to qualify. 

Optimal System Sizing for Efficiency

Installing a system that’s just the right size will ensure you get the most from your solar panels, balancing energy efficiency and cost-effectiveness to maximize savings. 

Tailoring Your Solar System to Your Energy Needs 

Your average household energy consumption will help determine the size of your solar panel array. Review your utility bills from the last year to establish a baseline for your annual electricity needs, and then design your solar panel array accordingly. 

It’s easy to assume bigger is better, but that isn’t always true with renewable energy systems. Installing an array that far exceeds your energy needs will result in unnecessarily high upfront costs without substantial benefits. In fact, producing too much power may be wasteful if net metering policies limit the amount of energy you can send back to the grid or you don’t have adequate battery storage to reserve excess power. 

Of course, a system that’s too small may not meet your energy demands, leading to diminished savings and continued reliance on the grid. 

Tools and Resources for System Sizing 

A professional solar analyst can be your greatest resource when planning and designing your solar array. They will assess your energy needs and offer a detailed cost/benefit analysis to help you understand your savings potential. However, you can also use online tools like the National Renewable Energy Laboratory’s PVWatts Calculator to estimate your potential energy output with systems of various sizes. 

Energy-Saving Habits for Solar Homeowners

Our solar savings tips don’t end with installation. Let’s explore how a few simple tweaks to your routine can help you save more with solar. 

Implementing Energy-Efficient Practices 

The more efficient your home, the less energy is required to meet your needs, helping you get the most from your solar panels and further reducing your reliance on the grid. Energy-efficient habits may include: 

• Switching to LED lightbulbs.
• Unplugging electronics in standby mode.
• Using smart power strips.
• Adjusting your thermostat by a few degrees.
• Running full loads of dishes and laundry.
• Upgrading to ENERGY STAR® appliances. 

Best Practices for Energy Usage with Solar Panels 

Strategic energy use can also help you achieve the best possible return on your investment. Consider scheduling appliances to run during the day when your solar panels are at peak productivity. You may stagger the use of large appliances, such as your dishwasher, washing machine, and dryer, to prevent sudden spikes in demand. Pre-cooling or pre-heating your home during high sunlight hours can also help you minimize energy sourced from the grid during peak use-rate times. 

Monitoring Your Energy Production

Achieving optimal performance isn’t a one-time event. Instead, it’s an ongoing process requiring continuous monitoring and regular adjustments. 

The Importance of Regular Performance Checks

Routine performance checks are a key component of energy optimization. Most modern solar panel arrays include built-in monitoring software, enabling you to see your system’s performance in real-time, analyze trends, and identify and address potential problems before they escalate. In addition to the native software offered by your solar installation company, inverters and batteries may include their own proprietary programs for highly detailed insights into their performance. 

Identifying Issues Early to Maximize Savings

Ongoing monitoring can alert you to abnormalities in energy production, signaling encroaching shade, dirt and debris, or more serious issues, such as electrical malfunctions and problems with your inverter. Here’s a step-by-step guide to troubleshooting drops in output:

1. Regularly review data: Energy capacity fluctuates throughout the year, but understanding baseline performance will help you recognize production problems.
2. Inspect panels for obstructions: Look for new shade, dirt, and pollen, and inspect for signs of damage and animal activity. 
3. Check inverter status: See the inverter or monitoring software for error messages and warning lights indicating a problem. 
4. Consult with your solar specialist: If issues don’t improve, reach out to your installation team for a comprehensive inspection. 

Considering Battery Storage for Added Savings

A list of solar savings tips would be incomplete without a discussion of backup battery storage. 

Benefits of Solar Battery Storage

Integrating battery storage is the ultimate way to get the most from solar panels. By storing surplus power for later use, you gain greater access to the electricity your array is already producing. This practice further offsets your reliance on the grid, meeting more of your needs with clean, renewable energy. Your array will first send electricity to the appliances and devices in your home, and what’s left over will be stored in your solar battery for use after sundown, during storms, and in the event of power outages. 

Integrating Battery Storage with Your Solar System

The best way to incorporate a solar battery into your array is to include it during the initial installation. Designing a system that includes storage ensures that your panels, inverter, and battery are compatible. However, battery backup may not be in the budget right away. Adding a battery or battery bank may be possible after a thorough calibration process. If your system isn’t equipped to accommodate backup storage, investing in a hybrid inverter could unlock enhanced savings opportunities. 

Staying Informed About Local Utility Rates

Just like the sunlight shining down on your home, utility rates continuously fluctuate, but monitoring resource availability will help you make informed decisions to maximize savings. 

Understanding Utility Rate Fluctuations 

Utility rates are on the rise, thanks to political instability, aging infrastructure, and volatility within fossil fuel markets. While average prices are increasing, rates also fluctuate throughout the day, the season, and the year. As these rates rise, your solar energy payoff increases, making that clean power even more valuable. You can generally expect higher costs in the early evening when many people leave work and residential energy demands spike. Check your utility company to learn how and when they integrate peak-use rates. Then, use this information to schedule high-energy tasks like laundry. 

Resources for Monitoring Utility Rates 

Your utility company probably has accessible guidelines about daily peak-use rates, but long-term trends may not be as clear. You can browse data from over 3,700 US-based utility companies using the Utility Rate Database from OpenEI. As rates continue to increase, you may find that additional battery storage helps you get the most from your solar panels. 

Learn How to Save with Solar Energy World

Solar savings tips go beyond turning off the lights when you leave a room – although that’s certainly part of the equation! Maximizing your savings requires a holistic approach to energy management, starting with the design process and ending with ongoing monitoring and maintenance. 

Ready to take your savings, efficiency, and energy independence to the next level? The experts at Solar Energy World are here to help. Get started today with a free solar estimate!