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Does a renewable energy system pay for itself?

Yes. The payback period – the length of time it takes for your savings from lower utility bills to equal the initial cost of the system – varies widely, based on the size and type of system you buy, the amount of energy you use or conserve, and how quickly your utility’s billing rate increases. Most projected payback periods for residential PV are in the 10-15 year range, based on 2015 prices, which is 10-15 years shorter than the warranty period. Once you get to the break-even point, you will pay nothing and nobody for the electricity your panels generate – and by then, utility rates will be higher than they are now. 

The projected payback periods for solar thermal, solar attic fans and other devices are generally shorter, but otherwise the same logic applies.

Here is another way to think about your investment in solar. Residential PV systems cost between $5,000 and $10,000 after the federal tax credit. That’s less than cost of a used car.  A car is a depreciating asset. Most of the value of a car is lost after 10 years, and meanwhile you are buying gas, insurance, license and repairs. Solar PV is an appreciating asset. Solar fuel costs nothing and solar systems require little or no maintenance. In addition, an investment in renewable energy will raise your home’s value, reduce peak loading on the grid, and support the local economy.  


Category: Financial Issues

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