SmartSolar.org works closely with property owners who want to ensure they can save money with solar power. That often means determining how much money they will save on their electricity bill. The average monthly electric bills with solar are typically very low, sometimes nonexistent. That could mean you have more money in your budget for other needs. Yet, that doesn’t mean you’ll never have an electricity bill again. If you are considering solar panel installation, you have to understand the realistic expectations of cost savings that solar brings.
How Much Will You Still Pay in Electric Costs?
Investing in solar panels allows property owners to no longer rely on the electric grid to power their homes. Rather, they will have their electricity needs met by solar power. That means once you purchase and install a solar panel system, these panels will collect solar energy and then convert it into usable energy for your home. With this system, you no longer have to rely on electricity from your utility grid.
Does that mean that installing solar panels eliminates any other energy costs? No, it does not. Your electricity bills will plummet to very low levels, but your solar company will still explain why you need to be connected to the grid and what to expect overall. Let’s break down what you can expect.
How much will your electric bill be if you install a solar power system on your own?
This will range widely. Most people will still pay a monthly electric bill that is 10-20% of what they paid before installing solar panels. The key is to know how well your home will do on solar and whether or not you are planning to finance your purchase of a solar panel system.
Other factors to consider when installing solar power on your own
How much you plan for your electricity bills depends on many factors, including the following:
- Where your home is located. Is there direct sunlight enough hours a day to meet your complete needs?
- The efficiency of solar energy systems. Quality systems are more efficient, making them capable of capturing and using more of the sun's rays than others do.
- Your local electric rate: When you install solar panels, you may not need to pull as much electricity from the grid, but depending on what your electricity cost is now, this may or may not lead to savings.
- Your energy consumption. How much electricity do you use each day, month, and year? You’ll need a system capable of meeting and beating your needs to keep up with your demand.
- How much will energy costs rise? Some speculate that energy costs will rise in the U.S. substantially in the coming years. If that happens, you could expect to save significantly by going solar.
As you think about how much solar panels save you money by lowering your electricity bill, remember that how much you pay for solar systems is also essential.
How Much Are Monthly Payments for a Solar System?
Solar panel costs can often be financed. That means you may have a monthly bill of several hundred dollars or more, depending on the loan terms you establish. The monthly cost for solar system installation and materials depends on many factors, including the size of the system you selected, the solar company, the actual solar panel costs at that current time, and the solar battery storage solution you put into place.
You can likely keep costs in line with your goals. For example, with the federal solar tax credit, you'll save significant money on solar panel costs. That means you don't have to finance as much, making it more affordable overall.
Don’t Forget Battery Storage
When considering the solar panel cost, do not look just at the panels themselves but also at the need to have a battery storage system in place to store excess power so you can use it later. Most often, storage systems are a part of the overall system, but not always.
One crucial factor to remember is that with a battery storage system, your home can remain powered by solar energy even when the sun goes down. That way, you can avoid having utility bills. Instead of relying on the energy grid when the sun is off, the solar battery storage system kicks in to meet your needs. That can also be important on rainy and cloudy days.
How Do Solar Panels Affect Electric Bills?
If you are still determining what to expect in your area from your electric bill with solar panels, give your electricity company a call. Ask them about the availability of a net metering credit on your electric or power bill. You also want to be sure that any net metering credits you get help to reduce your actual costs.
Most property owners should see their average electricity bill fall significantly. Once you pay off the solar panels and loan, you may also see even more savings. Over time, most solar panel systems will reduce your costs significantly, and eventually, the system can pay for itself. Here’s What else you can expect when you install solar panels:
Loan or Out-of-Pocket
You’ll pay for solar panels and the rest of the solar panel system either outright or with a loan. Once the solar system is installed, it begins collecting solar energy that can be converted into electricity.
Monthly Costs Will Fall
As that happens, your electric bill will fall. You may pay a fraction of what you are paying now for your energy needs.
You Might Still Have An Electricity Bill
There may be times when the solar panels do not produce enough power to meet your needs, requiring you to turn to the utility grill. That increases your electricity costs.
Improve Efficiency of Your Panels
You may be able to further reduce energy bills by improving the efficiency of the solar panels you install. If they can better meet your ongoing needs, that means lower electricity costs overall.
Save Money with Net Metering
That is, if you have excess electricity generated by your solar panels, you can sell that back to the utility company in many cases. In doing so, you may see a lower bill with solar or even one that’s no longer existent.
Frequently Asked Questions
We get a lot of questions about solar energy here at SmartSolar.org. Here are a few of the more common questions.
How Much Electricity Do You Save with Solar?
Considering the solar panel cost, you need to determine how much power you need from the solar panels and the type of solar system you plan to install. The amount of energy produced by the solar panel system ultimately determines how much you will save.
The average solar panels save homeowners thousands of dollars in energy costs over their lifetime. With the average system producing between 350 and 850 kWh of energy usage for your home, you can expect to meet most of your needs. The average U.S. home needs about 900 kWh of energy each month. That means 90% or more of your electric bill can be wiped away when you move to this type of renewable energy.
What About Excess Electricity?
Net metering is a way for you to generate solar energy from a renewable energy source for your personal needs and then sell the excess electricity generated back to the utility company, according to SEIA.org. Though regulations differ in most areas, there is no doubt that a net metering program can be one way to defray the installation costs further and give you even lower monthly electricity bills – or eliminate them completely.
Is Solar Cheaper Than Electric Bill?
Depending on where you live and the overall type of system you install, you will save
money with solar. Energy.gov shares that the amount of money you save and whether solar is more affordable than paying for electricity is also dependent on how much power you are able to generate and whether or not you lease or buy solar panels.
The cost of solar panel systems can be an initial investment that's rather high, and over their lifetime, solar is likely to save you money on energy costs. While most people will save money, some may not if they have an ineffective system or if they do not have enough direct sunlight available to benefit their home enough.
Are You Ready to Learn More About Solar Panels?
The solar panels cost you pay is dependent on what your local area can offer. To get a better idea of how much solar panels save you, contact SmartSolar.org today. Take our SmartSolar.org quiz to get more information about how well solar can work in your space. With a solar energy system, you could have more monthly money in your budget.