Category: Buying Solar

So When Does Solar Pay Off?

So When Does Solar Pay Off?

We’ve already discussed maximizing the ROI on your grid-tied solar power system, but when does solar truly start to pay for itself?

At first glance, pricing your solar array and determining  cost-offsets, payback period, and overall ROI might seem like a complex formula, but we’re here to help simplify the process. After reading this article, you should have a clear understanding of how much to spend and when you should expect it to pay off.

To figure out when your solar power system will begin to pay for itself, there are a few things you must consider:

  • Gross cost of purchasing the solar panels and all equipment (racking, power center, inverter, battery bank, etc). This is the “up front” price.
  • Tax incentives and rebates which can save you money once you install a solar power system. These can save you a significant amount on the back-end, at state, local, and federal levels.
  • Your monthly wattage use. You should know this right away, using our solar power cost calculator online you can predict how much electricity you’ll need to produce with your solar array, based on the electronics you use in your home and your average power consumption per month. The higher your electricity bill, the shorter your overall payback time if you’re able to zero that bill out on a grid-tied solar system.
  • Average electricity generation is another important factor - it’s often beneficial not just to provide enough power to keep the lights on at home, but also providing over the amount you need. With grid-tied systems, over-production can be paid back to the utility company, which can yield credit paid to you. With off-grid systems that have a battery-backup, this can give your home extra power on-hand should an outage or mechanical failure occur, or provide some extra juice for unexpectedly high usage (say, having guests over).

These are the basic factors to consider when buying any solar power system, but now we’ll delve into the differences in payoff period between different types of solar. Grid-tied and off-grid systems both pay off in different ways and over a different time period, so understanding the specifics of your situation.

This helpful chart from Understand Solar visualizes all of this data into a helpful chart on a state-by-state basis. As you can see, ROI on a solar system is at its absolute peak in Hawaii due to the state's extreme cost for utilities. If you're planning a solar installation on your home, this chart can provide a very helpful at-a-glance analysis.

average solar ROI per state

As a rule of thumb - the higher the price of electricity in your area, the quicker your payoff period as you offset the cost of the monthly utility bill.

For more information on getting the best ROI for your solar array, Wholesale Solar has a dedicated information page to assist you. 

Grid-Tied Solar:

Most solar customers in residential areas choose grid-tied solar, for obvious reasons! With a return on investment of only 4-6 years, your grid-tied systems start paying for themselves in very short order. If you’re producing more electricity than you need and paying it back to the power company, you can pay back your investment even faster. Government incentives pay up to 30% back, so your barrier to entry is comparatively low, and you will start seeing the difference in your power bills almost immediately.

With grid-tied power systems, this short payoff period means a much greater boon for you long-term. Power companies’ prices are only getting higher, and since most panels and inverters have 10 to 25-year warranties, you’ll be living off essentially “free” electricity for the majority of that period.

Off-Grid System:

Off-Grid solar is a very different investment from grid-tied. Generally more expensive than their grid-tied counterparts, off-grid systems give you nearly double the investment, however, as they start paying off immediately - having no connection to the grid at all and providing 100% of the power for your home (with the slight downside that the system can’t be backed up by the local grid if it fails for some reason). This minor downside is of course compensated by having a battery bank to store excess power and keep the lights on even if something goes wrong with the main system.

Installing an off-grid array using a DIY solar power kit helps you save even more money - no need to pay for an electrician or professional installer when doing it yourself. You’ll still need to file for permitting your solar array, but beyond that it’s all up to you to purchase and install.

One of the main reasons off-grid solar yields such a high ROI is the cost of wiring. If you wanted to get grid-tied solar in an extremely rural area, the price to install wiring alone can cost upwards of $50,000 - an added expense you definitely don't want! By going off-grid, you save yourself a bit of time and a ton of money. 

The More You Know

So there you have it, the lowdown on getting the best return on your solar investement. Remember, the higher your utility costs without solar, the quicker your new array will pay for itself as it cancels those costs out once installed.

Our Core Values

Our Core Values

OUR CORE VALUES

Today we'd like to share a message about who we are as a company that Allie Coleman, CEO of Wholesale Solar, recently shared with us.

By ALLIE COLEMAN

Happy Summer, Folks!
 
Let's talk about something that we're so passionate about that we made it our #1 core value: creating the highest quality customer experience possible.
 
There are so many intricacies and pathways along your solar journey. From the very first quote through to your final purchase and install, it seems like a difficult process - too much for one person to DIY, even.
 
 Fortunately, we've gotten really, really good at delivering the best customer support and assistance! That's because everyone in our offices really cares about the people we work with and the product we're providing. What a great place to start!
 
Customer Experience = the collective result of a customer's every interaction from the very first visit on our website to the very last click! 

"There are so many intricacies and pathways along your solar journey. From the very first quote through to your final purchase and install, it seems like a difficult process - too much for one person to DIY, even."

What makes a great Customer Experience?

Building Trust:

We know that buying a solar system is a big deal! We strive to provide customers with as much information as they need in order to feel comfortable working with us and to create trust in their own abilities. We will be accountable for our actions and meet the expectations that we set: we do what we say we will, and always keep our word!

Simplicity:

We aim to make solar simple. We will work to make our website, communication, delivery, and products as user-friendly and seamless as possible. Great news! Our product and tech team plan on having Quick-Start guides for our systems complete this year!

Support:

We aim to empower our customers to DO IT YOURSELF...With us! We're actively creating educational content (articles, videos, checklists) to guide our customers through every step of their solar process from your first quote and permitting to the final install. We will pick up the phone and we facilitate providing the support they need!

Appreciation:

Without our customers, we can't create the kind of great change in the world we want to see. With this in mind, we're always looking for ways in which we can thank our customers and showcase their incredible handiwork!

How can we make a great Customer Experience every time
 
Simple. Quality assurance is all about mapping out the repeatable ideal pathway down which we will lead our customers. Our tool for this will be clearly defined and easily accessible processes for each step of the buying cycle. More and more clear direction around ALL processes is coming soon!
 
How do we measure the quality of the Customer Experience we're providing?  What can you do to make our service better?

Do you have ideas about improving our customer experience? We want to hear your voice! If so, take a moment to fill out our survey below.

Spread the word

The Simple Math Behind Saving Big On Solar

The Simple Math Behind Saving Big On Solar

Solar Payoff: It’s Simpler Than it Seems

Let’s face the facts: we all need electricity.  It’s a necessity that we pay for every month.  The idea here is to pay off your solar system with what you would normally spend on your utility bill.  Month after month and year after year you’re spending money on power with no end in site.  Why not spend that money on a solar system instead with the goal in mind to never pay for power ever again!

You’ve probably heard talking points like payoff period, ROI and many other money-saving terms when it comes to buying solar.  The payoff period is how long it takes to pay off the cost of your solar system with the money you would have spent on your utility bill.  The money you save on your utility bill over X amount of years will play a key role in figuring out your payoff period, so knowing how many years that will take could be the deciding factor for a lot of people looking to convert to solar. Once the payoff period has been reached, every cent saved afterwards is pure ROI – return on investment.

The Basic Formula

To figure out when your solar power system will begin to pay for itself, there are a few things you must consider:

  • Gross cost is the sum of your solar system and additional contractor work.  This includes components like Solar Panels, Racking, Charge Controller, Inverter, Battery Bank, etc. This is the “upfront” price.  (Note: Always talk with a Solar Technician before building your system.  They’ll be able to help you with designing a highly efficient solar system tailored for your location.)  Hiring someone to help with part of the install is totally fine and often recommended when it comes to hooking up some of the electrical components to your house.
  • Tax incentives and rebates can save you money once you have installed your solar power system. These will save you a significant amount on the back-end.  You can cash in on these incentives at the federal, state and local levels.  That’s an opportunity to 3X your savings.  Now, combine that with the HUGE discount you get with a DIY solar system, and watch your path to savings quickly accelerate!
    1. 30% of the cost of your Solar Electric System and installation can be deducted from your federal tax bill.
    2. Selected states have their own additional incentives.
    3. Regional or local districts can also have additional incentives.  Be sure to do a quick Google search to find out.
    4. The DSIRE database shows both state and local incentive programs. Utility providers will have info on their website if they offer an incentive. For example, Google: “PG&E solar incentives,” or whoever your utility company is.
  • Your monthly power usage can be found in your monthly utility power bill. Ideally, you’re going to want to enter that into our solar power cost calculator.   This should help you to figure out what kind of solar power system you’ll need to power your home.   If you don’t have your monthly power usage, you can select the option to use your average monthly utility cost.
  • Average electricity generation: Under Net Metering, power produced by a Grid-Tied PV system is sent into the household load panel, where it powers appliances. Any excess power feeds into the grid, turning the utility meter backwards and applying a credit towards your bill for every kWh generated.  The utility will take a look at your usage, typically once annually, to determine if you over-produced or under-produced. If you under-produced, they send a bill. If you over-produced they offer to roll over credit to next year or pay you for the credit. But they only pay a small amount for extra power — for example, if you buy power at $.12/kWh, they may only pay $.06/kWh.  With Off-Grid Systems the approach is different.  Off-Grid Systems are eliminating the dependence on the utility grid and going completely independent.  Basically, you become your own power plant.  Off-Grid Systems require a Battery Bank to store energy for night time use and when the sun isn’t as efficient. We also recommend a Backup Generator for recharging during long periods of overcast weather and as a backup power source. These are additional costs that you must consider when using an Off-Grid Solar System, and therefore a longer wait until it’s paid off.  Usually, the goal of an Off-Grid system isn’t directly tied to long-term payback.  Normally people go Off-Grid because there is no utility power source close enough to power their home and it’s much cheaper to use solar than to run cables from the grid.
  • Additional Cost:  Before you get your Solar System, you’re going to need to get a solar permit.  Getting a permit is often accompanied by some light weight fees that your local authorities will add on.  But, there’s good news.  We have a free Downloadable Solar Permitting Cheat Sheet that is a great asset for anyone trying to save time with getting their permit.  Time is money, so considered this a way to off-set any permitting fees.

How do you equate an accurate payback timeline so that you can mark on your calendar the day you don’t have to pay for power anymore? Simple! We’ll show you:

Easy Math, Big Savings

Now that we have all the components, we can begin to see how long it will take pay off your solar system investment. let’s run an example:

A typical equation might look something like this: 12,900-4,370 = 7,530 / 1,440 = 5.3 years till solar system is paid and you’ll never pay for power again.

Based on 1,000 kWh per month usage, package #1890914, price of $.12/kWh for power.

Costs

  • Exp: DIY Solar System $11,000
  • Exp: Electrician costs: $1500
  • Exp: Permit Costs $300

Total Expenses: $12,900


Savings

  • Save: 30% Federal tax rebate $3870 (12,900 x 0.30)
  • Save: State and Local Level incentives $1500 (estimated additional state & local incentives)

Total Upfront Savings: $5,370

Annual Utility Savings $1440/yr ($.12 x 1,000 x 12)


Total Expenses (minus) Total Upfront Savings (divided) Yearly Savings = Payoff Period In Years

or based on our example: 12,900-5,370 = 7,530 / 1,440 = 5.3 years

If you’ve ever considered solar, you should grab our free Downloadable Solar Permitting Cheat Sheet.  It can save you hours of time when you’re ready to invest in solar.

Solar Permitting Step-By-Step 1: Interconnection

Solar Permitting Step-By-Step 1: Interconnection

Permitting for your planned solar array installation may seem like a daunting prospect, but we’re here to help take hours off the process by streamlining it for you. You may have already signed up to receive our free Permitting Checklist, and even read our Step-By-Step guide online.

You may have already priced your planned solar power system by using our online solar power calculator, or called one of our sales people or technicians for some early advice. Before you even set foot on your roof comes the real work – getting your system installation approved by your city or county authorities.

Begin by determining your AHJ (Authority Having Jurisdiction) – this will either be your City or County Building Department. This will be the authority to whom most of your paperwork will go. Once you’ve determined whether your home falls within county or city jurisdiction (usually based on whether your home is in an urban or rural area), you will be able to determine their requirements for hooking up solar power.

If you’ve got your DIY solar kit picked out, you will need to show your utility company what you plan to use – they need to confirm whether or not the equipment is UL 1741-certified (meaning it’s approved for tying into the power grid).

When you consider interconnecting solar power to your home, you should expect to cover some preliminary facts, including:

  • Location of utility meter, electrical panel(s), proposed PV array and other landmarks
  • the number of solar panels and inverters, including manufacturer and model being installed
  • the capacity rating for your planned power inverter and PV panels

When planning out your solar array at this step, it’s also a good idea to check your state’s Rebates and Tax Incentives, which can help lower the cost drastically and make going solar that much more affordable.

With the above steps done, you’re ready to move on to the next: Contacting Your Local Permitting Office. 

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SolarWorld Americas Sheds Some Light On Company Status

SolarWorld Americas Sheds Some Light On Company Status

Some of our readers may have heard that SolarWorld was facing some financial trouble in May 2017. While that is true, and some difficult decisions had to be made by the company at an international level, rest assured, SolarWorld is still with us in the form of SolarWorld Americas.

SolarWorld Americas, based in Portland, Oregon, strived to pick up the slack from its German home company and continue the tradition of providing the highest quality crystalline-silicon photovoltaic panels and solar power systems on the market, retaining a standard of excellence even in the face of stiff competition from overseas manufacturers.

The 42-year-old solar company aims to improve its services immediately with the introduction of dual-warranty protection. A little extra peace of mind at no added cost, the Dual Warranty plan goes into effect immediately in the event the original warranty can no longer be supported (due to expiration, invalidation, etc.). This provides an extra layer of protection guaranteed on your expensive solar equipment, so you can worry less and enjoy the summer weather more.

This new package, dubbed SolarWorld Assurance, offers these protections with zero premiums, zero deductibles, and transferable policy ownership – you, the customer control the policy with no strings attached. In the wake of the parent company’s insolvency, this shows SolarWorld Americas sending a clear message: quality matters, the customer is king, and they intend to keep American-made solar coming for a long while yet.

Dual Warranty SolarWorld With Wholesale Solar

This shows SolarWorld Americas sending a clear message: quality matters, the customer is king, and they intend to keep American-made solar coming for a long while yet.

So what does this have to do with Wholesale Solar? Well, SolarWorld’s Dual Warranty is 3rd-Party backed and guaranteed, meaning we get to offer it when we sell you solar power systems featuring SolarWorld products – such as our 4th of July Free Shipping offer! We always help our customers ensure their warranty info is filed with the manufacturer and guaranteed to be honored, so this new SolarWorld Assurance policy provides a new level of customer confidence, offering peace of mind at the perfect price: free.

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Free Energy or Fire Hazard? Shedding Light on Fire Codes With Solar

Free Energy or Fire Hazard? Shedding Light on Fire Codes With Solar

There’s no question that solar power is good for the planet; however, there’s a reason that solar arrays have to go through extensive permitting, reviews, and inspections before being installed on the roof of your home: if done incorrectly, they cause series problems for firefighters.

Recent concerns raised by firefighters have shown that, in emergency situations, the added weight of solar panels on rooftops, as well as the potential for electrocution, poses significant risks to firefighters attempting to extinguish fires in residential areas. Firefighters must have access to a building’s roof – they frequently cut holes in the roof to vent smoke and heat, and with solar panels blocking their way, the firefighting operation can run into trouble.

Of course, there are precautions in place when it comes to solar hookups — all permitted solar arrays must have shut-off switches clearly marked, and city and county fire codes ensure there is ample space for emergency workers to work in just such an occasion. But not all cities and counties are the same — LA, for example, has some of the strictest fire codes in the nation regarding solar array installation.

However, some locations, such as Manchester, New Hampshire, where a fire occurred this January, still uses old fire codes from 2009, which have yet to adopt safety precautions and requirements for PV panels. Although firefighters in that situation had not encountered problems with solar arrays until then, they’re determined to adjust their tactics in the future as solar power becomes more prevalent.

Of course, any new technology has its fair share of teething problems. When electric cars were first introduced, firefighters and rescue responders encountered a very similar problem. Electric and hybrid vehicles use a much higher voltage battery to power them, and in the event of a traffic accident, rescue workers can’t simply disconnect the battery like with a standard vehicle. They risked electrocution at first, but new legislations came about that made their job safer, with clearly marked breakers and kill-switches so they can shut off EV batteries quickly and perform their duties. Solar power is no different – as more and more people switch to clean, renewable energy sources, legislation will catch up to them, making the choice to go solar even easier, as it remains safe and reliable.

Of greater concern in recent weeks has been Tesla’s Solar Roof Tiles. While an innovative concept, Elon Musk has taken great pride in showing just how durable these tiles are, able to withstand hailstones shot at them at 100 mph. That kind of durability is impressive….but what if there’s a fire? That would be significantly harder for firefighters to cut through in an emergency – under normal conditions, firefighters have around ten minutes to cut into the roof and relieve smoke and heat pressures on the house before it collapses. If they’re slowed by ultra-tough roof tiles, they may run out of time, and, since Tesla’s solar roof tiles look almost identical to conventional roofing, and the homeowners may not be able to inform the rescue workers in question, they may pose a real danger.

Don’t let all of this scare you away from solar, though! As one of the leaders in our industry, we pride ourselves on providing safe, effective renewable energy sources with our DIY kits. Our skilled technicians help you every step of the way – from the initial permitting process (which includes checking your city or county fire codes!) to the completed installation and inspection, to ensure that your solar installation is compliant with local regulations, safe for your home and family, and brings you the peace of mind that comes with a job well done. 

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5 Costly Mistakes to Avoid When Mounting Your Solar Panels

5 Costly Mistakes to Avoid When Mounting Your Solar Panels

Your solar power system is only as good as the racking it’s mounted on. You want to get the most durable, effective, flexible racking for your panels, while also keeping in mind several important factors that can make or break your project. So before you start installing, make sure you’ve considered the following important aspects of racking, and save yourself time, money, and peace of mind:

Price: Determining the size of your solar project, as well as the expected cost of it, is an essential part of the process. Take into account that you’re not just buying solar panels, but also racking, power inverters, charge controllers, battery banks and even generators depending on the size of your project and whether you choose grid-tied solar, off-grid solar, or another format. 

Use the Wholesale Solar cost calculator, check to see what incentives your state offers for switching to solar power, and determine how much you’re willing to spend to get the most out of your planned solar power system before you start installation. Keep in mind that the cost of your solar power system is only one aspect of the project. Many states also require permits, surveys, soil samples, and even minor engineering in order to accommodate a solar installation, which can add unforeseen expenses that you will need to budget for and plan around.

Ground Mount of Roof Mount?: Setting up your solar panels on sturdy racking such as an IronRidge XR10, XR100, or XR1000 mount ensures that your solar power system is secure and protected against high winds or inclement weather.

Choosing the right racking usually comes down to a combination of cost and available space.  Roof-mount racking is generally more affordable, and uses the available space on your roof, while ground-mounted systems can be quite expensive with extensive preparation work required before installation – including obtaining soil samples, digging, and pouring cement upon which to mount your planned racking.

Efficiency: With any solar power system you want to get the most efficient setup you can and maximize your return on investment. This means more than simply getting high-efficiency panels, however – in fact high-efficiency panels are often costly, and not necessarily better for residential customers (“efficiency” in this regard normally means more power produced with a very small panel size, useful for NASA satellites in orbit or other expensive projects). However, high-efficiency systems are often desirable if working with a limited amount of space, where getting the most out of the room available is essential. 

An efficient solar power system here is one that makes the most use out of available hours of sunlight, taking into account the angle at which they’re mounted and the amount of roof or ground mount space is available to you. Making sure your panels are mounted so that they don’t get covered by shade, wind-blown debris, or other factors is also essential  – even a small amount of shade, leaf litter or pine needles can reduce a solar panel’s output by 50%, so plan out your installation accordingly and get the most out of your investment!

Orienting your solar panels correctly can help get the most out of your investment as well. True “solar-south” orientation is the most desirable, allowing for the most coverage during the day and therefore the most sunlight collected by your panels. If your roof does not face solar-south, however, east and westward-facing panels can still be productive.

The Right Setup for Your Roof: Roof types can make all the difference when setting up a DIY solar power system. The type of roofing material can make mounting and racking more or less difficult, and determining what works for your particular situation is an important step – one that’s best to tackle ahead of time before you start spending!

  • Metal roofing is especially easy for mounting solar panels, strong and durable like the panels themselves. Usually found on industrial buildings, this roofing type accepts roof mount racks easily, with little extra work needed. Metal roof clamps either drill into the roof to fasten securely, or clamp onto the metal seams with no drilling necessary. 
  • Shingle or Slate roofs need to be drilled into in order to mount your racking system. Due to the fragile nature of this material, precautions need to be taken regarding flashing and sealing your drill-sites against the elements, to ensure your roof doesn’t leak after installation. Shingle or slate roofs need to be in good repair before you mount solar panels – we recommend a roof with a projected useful lifespan of 10+ years. 
  • Tile roofing is slightly more difficult, as we know from April’s Install of the Month, as you need to fit specialized tile hooks or brackets to your mounting in order to support the racks. Some roofers recommend replacing tile altogether, as tiles often break during the installation process.

Choose the Right Racking: Planning out your solar array to be the most efficient and cost effective setup is important. In order to do this, mounting your panels on the right racking, keeping in mind the importance of location, angle, and the scale of your overall project, is vital.

To this end, we put together a cheat sheet of different racking types and brands, to help guide you in getting an idea of what’s right for your project. Our technicians are available via phone to assist you, as well.


Learn more about each racking brand: IronRidge XR and SGA, DynoRaxx, MT Solar, General Specialties, Tamarack Solar.

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Buyer Beware – With Tesla’s New Solar Roofing Tiles, The Devil is in the Details

Buyer Beware – With Tesla’s New Solar Roofing Tiles, The Devil is in the Details

Tesla, one of the leading innovators in the solar power marketplace, recently announced pricing details for its revolutionary solar roof tiles – a system that, until now, seemed like a pipe dream. For many would-be solar customers, it still is.

“We paid our $500 down and were to get an assessment from an installer within a week.  Installation was to have been completed by the end of April.  Never happened.  Never even were contacted…We have tried to get some of the solar electric installers locally to become certified Tesla installers, but they are leery of the Tesla track record of promising but not coming up with the product.” – Susan Q, former Tesla customer. She converted to Wholesale Solar and purchased a 4.43 kW Grid-Tied Solar System from us shortly thereafter.

If you are dead-set on a solar power system, Tesla’s solar roof tiles may seem like a dream come true  – offering a similar aesthetic to shingle or Spanish tile roofing, but with the added benefit of photovoltaic cells rather than normal solar panel arrays. Much of this technology is untested, however, without the proven history of reliability and durability that current solar panels are known for. Rather than mounting on a racking system, solar roof tiles replace the entire roof – which is fine if you’re building a home from the ground up, but may seem unnecessary to many homeowners, when their home has a perfectly good roof already. These concerns are just the beginning, however, there are a few factors to consider which may influence your decision:

Price

While their pricing is noted as being competitive with other roofing styles such as shingle or tile, coming in a $21.85 per square foot, the cost of installing a complete Tesla solar roof tile system is still more than many homeowners can afford. An average roofing job will cost around $73,500 after solar tax incentives and rebates, according to consumer reports – comparable to a shingle or tile roof, and will save a family over $2000 a year on power costs.

While such an installation will pay for itself over time, the up front cost is still a huge investment compared to the $5000-30,000 you’ll spend on a DIY complete solar power system. Whether you go off-grid completely or grid-tied to zero out your utility bill, you get the same return on investment and guaranteed reliability with proven equipment and technology, all for a fraction of the price.

Solar panels vs Tesla solar roof tiles cost comparison
Our friends at Spice Solar calculated the cost of a 2,500 sq. ft. roof in California and compared Tesla’s solar roof tiles against ordinary solar panels. The price difference is shocking.

Tesla also promises an unlimited warranty on their solar roof tiles, a big bonus to be sure – but the promise of a warranty is only as good as the product it’s backing, and with potentially years of waiting before Tesla installs solar roof tiles on a customer’s home, those promises of a warranty might be just so much hot air. For comparison, our solar panels have a guaranteed 25-year power warranty, and are a product that’s ready right now, when you need it. Our pre-wired power centers also come with a 5 year warranty of their own, and other products from various manufacturers we carry are supported with warranties of anywhere from one to 30 years. At Wholesale Solar, we keep our promises, and back them up with tangible results.

Time

Depending on the size of your solar installation project, setting up your DIY system can take up to a few days to set up – hard work, but well worth it in the end! You should always take into account the planning, permitting, and other essential stages ahead of time to save yourself some trouble once that work begins.

Tesla’s solar roof tiles, however, take over a week to have installed by a professional roofer – often at an added expense, and is not something you can do on your own. This is a major downside for many people, and the inconvenience of having roofers in and around your home and property can dissuade many people from installation.

Complexity

Solar roof tiles are a complex system – with individual cells grouped together and multiple points tied to wiring, power control, and even “dummy” units – cells that look the same, but aren’t actually solar cells, to comply with fire code regulations. This creates a very difficult, specialized installation only a few contractors are capable of – in fact, Tesla has their own installation personnel who they use for the job. Maintenance costs can also run high, as this installation is so beyond the standard that it will require specialized experts to service or repair.

For comparison, a complete DIY solar kit from Wholesale Solar is custom-tuned to your individual needs, and prepared before shipment to be almost “plug and play” – no difficult rewiring, no specialized electricians or contractors required, and that’s part of what makes them special. It’s a solar power system that you can install on your own, and our technicians are on-call to help should you have questions.

“Turns out they can’t find anyone in our area who wants to be a certified installer.  They won’t sell to owners who want to install their own, even if overseen by an electrician…We have tried to get some of the solar electric installers locally to become certified Tesla installers, but they are leery of the Tesla track record of promising but not coming up with the product.”

– Susan Q continues to elaborate on her difficulties with the system in question. She intended to DIY with parts ordered from a number of sources, solar panels from a different manufacturer, and a Tesla PowerWall to accommodate her inverter and battery storage needs. Not only did Tesla never deliver the PowerWall, but the planned installation process was hampered by Tesla’s certification requirements and bureaucracy.

Solar is Ready Now

Tesla will begin installing solar roof tiles in the state of California starting this June. However, preorders and installation scheduling are often quite high, and it can take months or even years before the company’s production schedule ramps up enough to get to your project.

Solar power systems are available today, ready to ship to your door and install immediately. This means you can switch to clean, sustainable, renewable energy for your home without having to wait, just call and order, no hassle.

Solar Roof Tiles may be a major player in the future, but there are still more affordable, immediate ways to transition to solar power for your home or business, and we here at Wholesale Solar can help. Our reviews speak for themselves, and we have a long record of satisfied customers and successful DIY installations across the country. Check out our online solar calculator to determine the cost of your project, call for a quote, and start making a difference with solar power today!

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Buying vs Leasing

Buying vs Leasing

solar-system-buy-or-lease

Solar Power: A Short History of Buying vs Leasing

As a company who sells directly to homeowners, we believe solar panels are an asset to your home that can increase its value, save you money, and increase your energy independence. If that’s the case, why are there companies who choose to lease you systems? Well, we hope this post sheds some light on the history of solar panel leasing…

The rebates begin: Federal, state, and local

Since 2006, there has been a federal tax rebate that underwrites some of the costs of a solar purchase and installation. The government didn’t have a lot of luck with the original limit of $2,000, so the plan was changed to cover 30% of the total cost of the solar purchase and installation with no upper limit.

Soon, state governments got involved, offering state-sponsored rebates, subsidies, and grants. Eventually local administrations joined in as well and local utilities agreed to buy excess energy that was fed back into the grid, often at twice the going rate that they were charging for electricity. Why? Because by using a certain percentage of renewable energy, they were granted carbon credits which they could use to offset the pollution they were creating elsewhere.

The recession: How to make money in a down market

The recent recession from 2008 to 2014 put a pretty big dent in the US economy. As a result, many of us learned a rather costly and humbling lesson not to overextend ourselves financially.

To make matters worse, bank loans dried up. The stock market had poor returns; savings accounts were paying negligible interest. Investors needed some sort of profitable vehicle for their cash, and they found solar energy.

(Excuse the slight drama)

“Great!” thought the investors, “We’ll rent solar panels to people, giving them a 10-15% savings over what the local utility would charge for the same amount of electricity. They’ll pay just to get away from what their utility charges, and feel self-satisfied that they are green. But since we own the panels, we’ll get all the rebates and subsidies, plus any income derived from selling excess power back to the grid. We’ll have the household revenue stream, plus what the utility pays us. And since power will rise in cost, we’ll put in a clause increasing the cost 3%/year even though we’ve done nothing to improve the service!”

“That’s true,” said another, “solar panels are maintenance-free, so they cost us nothing more, but we’ll rake in the monthly fees. And just to be sure we keep making a profit, all lease contracts for solar power shall be at least 15 years, and our renters can only pass leases on to a subsequent purchaser of the house if that purchaser has a 640+ FICO score, so our investment is always protected.

“And,” said another investor, “if they terminate the lease early, we can impose large financial penalties. Best of all, at the end of the lease, they still don’t own the solar panels. They can renew the lease or they can buy the solar panels at almost the original price. We’ll make a fortune!”

While everybody else in the post-market crash was looking for returns of 1-2 percent and considering themselves lucky if they found 2.25%, the companies leasing panels were looking at 8% returns on their investment, 400-800% better than other investors.

The road to recovery: The post-recession solar market

Now that the economic recovery is well underway, interest rates are at an all-time low, and lending money is once again available, there’s no reason to let solar rental companies continue to making huge profits at your expense.

The federal subsidy we mentioned earlier was supposed to expire in 2016, but it has been renewed until the year 2019 with no changes (30% of total installed cost). Then it will gradually decrease in amount every year (down to 22% by 2021) and finally expire at the end of 2021.

Now would be a great time to take advantage of the credit before it’s gone. Even though the cost-per-watt of panels is decreasing every year due to increased production and economies of scale, the other costs of solar (additional hardware, installation, permitting, etc.) are not decreasing as quickly. The federal tax credit covers ALL of the above, not just the panel costs, but 30% of the total installed cost, including labor and permitting. If you wait too long, you won’t be able to recoup those other costs (which can be quite significant).

As an example, if you were to purchase a typical four-kilowatt solar system today like our 4.2kW Solar Sky Astronergy package, you would save at least $2100 from the federal tax credit alone. If you waited until the FTC to expire, even if panels dropped 50% in price by 2021, you would still not recoup that much money. Only the FTC can save you so much on the overall cost of a system (remember: panels are only a percentage of the overall system costs!), and you only keep the FTC if you buy, not lease, a system.

Would 4 kilowatts be enough to run your home? That’s just the average in California. If you can afford it, you can choose a bigger system. Then, even if you’re not home all day, your solar system continues to create power and, in states that permit it, excess power is returned to the electrical grid and “net metered” (meaning you actually get credited for any excess power you produce).

Then when you are home at night, you can draw that power back from the grid (sometimes for lower than daytime rates). If your production vs consumption balances out by the end of the month, your power usage bill is almost zero (there might still be a small flat fee that utilities charge just to connect your house to the power lines). If you put in more than you took, you get a check or an account credit.

And even if you undersize your system, producing less than you use, or if you choose to start with a smaller system with the option to scale up later (like our Enphase micro-inverter systems), you would still be able to take advantage of the FTC and at least partially offset your utility bill.

But if you don’t own your system at all and only rent it, the leasing companies keeps the federal tax credit AND the excess production that you would’ve gotten paid for.

In summary: To rent or lease?

There are number of factors to consider, such as if you have a good southern exposure, how much insolation (usable energy from the sun) you receive, what your current financial picture looks like, whether you have a very old roof on your house that you would want to replace before you install solar panels that are going to last up to 40 years. Ground-mounted installations are another option.

Reasons to buy:

  • If you buy it, you own it.
  • There is a fixed, predictable period of time over which it will pay for itself (3-6 years, depending on the install), after which it is pure profit.
  • It increases the value of your home;
  • You get to keep all of the subsidies, grants, and tax credits;
  • You get paid for extra power production if your utility allows net metering.
  • In most cases you can claim the interest on your loan to purchase the system as a deduction on your taxes, something you cannot do with the solar lease program;
  • Systems are very reliable; they hardly ever need maintenance aside from a scheduled inverter replacement a decade or two later. Inverters come with a warranty of 12 years (upgradeable to 25).

 

Reasons not to rent:

  • The “zero-down” claims are not entirely true. You may not be giving them cash money, but by signing that power purchase agreement (PPA) or lease, you are giving them your 30% federal tax credit and any eligible state or local incentives. You’re giving them the thousands upon thousands of dollars that should rightfully be in your pocket or your bank account.
  • When all the adding up is finally done, you’ll discover that you paid the leasing company more than twice as much as it would have cost you to purchase the system yourself and finance it. With the available incentives it should cost less than $2 per watt (all-in) to install your solar system if you DIY it (like many of our customers do; see our Customer Installs of the Month)

 

What if I can’t afford to buy a solar system outright? Can I finance it?

Some of our customers have enough in savings to purchase a system in cash, which is what we usually recommend (debt can be dangerous!). However, for those who want to take advantage of the Federal Tax Rebate before it sunsets in 2021, there are other options to help with affordability, such as:

 

The Takeaway

Renting solar panels is a great idea… for the leasing company. It is not a consumer-friendly business model.

In our recovering economy, PPAs and solar leases no longer make sense. Those two methods actually represent the most expensive ways for consumers to use solar energy. They were designed for investors to take advantage of a market in recession, not to help homeowners install solar.

Even more insidious is the escalator payment scheme, which allows leasing companies to increase your payment rate by 3% per year for 20 years. By year 20 you’re paying more than 175% of what you paid in year one.

By contrast, buying your panels outright saves you more and more money every year you own it. Even if you have to finance it, with a low enough interest rate there is still a good potential for positive payback.

Wholesale Solar is a 100% employee-owned company, and we want to do what’s right for you, our customer. Our 4.9 star Google reviews rating proves this. Give us a call at 1-800-472-1142 or use our online form to request a quote. We’d love to hear from you!

Google Sunroof: Automatic solar rooftop analysis

Google Sunroof: Automatic solar rooftop analysis

On August 17th, Google announced Project Sunroof, a tool that lets homeowners easily visualize their rooftop solar availability and potential savings.

It is currently only available in limited areas (near San Francisco, Boston, and Fresno), but a nationwide rollout is on the horizon.

Project Sunroof’s Automatic Rooftop Solar Analysis

Google Project Sunroof
Given an address, Google Sunroof will visually display rooftop solar availability and shading.

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