On average, domestic users of solar panels will require 20 years, (though some estimates report 8 to 10 years or even 15 years depending on various variables) to recoup the cost of purchasing and installing a complete solar panel system. in less developed countries where low quality solar panels may be used, the value of such an installation is less, with a payback duration of over 25 years on average. The major reason for this is the low efficiency of photovoltaic cells, which ranges between 15 and 20%. This, combined with the reducing cost of advanced photovoltaic cells, is driving up their demand. In the past, the prices of solar panels were quite prohibitive.
Recent advancements in material science research has resulted in introduction of photovoltaic cells with efficiency ratings of around 42% or more. They take shorter durations to pay for themselves, and provide more electricity compared to older panels. Optimizing other factors including placement of the solar panels plays a great deal in how much energy they produce. Solar panels are an increasingly popular method of utilizing green energy. This uptake is driven by rapid progress in material sciences. It results in increasingly effective solar panels which do not waste a lot of energy. A potential solar panel buyer would be interested in recouping this investment by almost completely relying on solar electricity, which offsets bills from the grid.
It is possible to achieve this by understanding the nature of solar panels and the realistic panel payback period you can expect. One can calculate this figure, but it depends on factors which need to be optimized to achieve a quicker payback period.
Solar panels can be an expensive purchase. When well-made solar panels are installed, they significantly reduce one’s electric bill by providing electricity that one does not have to pay for once the solar panels are installed. The savings made end up being equal to the cost of purchase and installation of the solar panels. At this point, the solar panels will have paid for themselves as the user will have technically recouped their investment. Several factors influence the time it takes to achieve this state.
Quality is Paramount
The increasing demand for going solar has spurred a concurrent increase in the manufacture of low-quality solar panels. It is also reducing the cost of solar installations. These have a lower power output compared to well-made solar panels and may have a larger footprint to boot. They are also likely to last a short time, commonly before one even recoups the cost of buying them.
To quickly recoup the cost of going solar and to reduce the electricity bill, the panels themselves as well as the accessories needed to use them (batteries, inverters, wiring and charge controllers) need to be of high quality. This does not necessarily mean expensive. It is also wise to perform an audit of what one expects out of the solar panels as this will guide them on what types to buy. An individual interested in powering their entire home using an investment in solar systems alone would require more panels than one who buys the panels for specific purposes, such as providing lighting during a power outage.
Determining the Solar Payback Period
How long does it take for solar panels to pay for themselves? This is determined by an interplay of factors. Carefully evaluating these factors will give an accurate idea of when purchase, installation and maintenance of the solar panels will break even because of reduced usage of power from the mains electricity utility grid. These include:
Average domestic power usage
It is important to determine how much electricity is consumed in a home during an average day or year. The national average domestic electricity use is 29kWh daily, or 10,500kWh per year. This is done by assessing when electronics such as electric kettles, kitchen appliances and entertainment appliances are used. The power consumed is a derivative of the wattage of each of these products, how long they are used for at a time and if they have any energy-saving features. How long does it take to determine this? A homeowner can take their time to calculate this figure or consult an electrician to do it. The latter is a faster method, and allows a homeowner to accurately determine their solar panel payback period. The final figure will determine the minimum utility output the solar panel installation should have if it is to be used for the entire home. It also determines the solar panel accessories needed. A good electrician would also be capable of determining short, medium and long term benefits of solar installation and the nature of the payback a customer can expect. This includes the expected monthly savings in light of the financial ramifications or costs of getting the system.
If one has decided to depend solely on solar power for domestic use, they can opt to replace some of their electronics with energy saving ones. These include TVs, microwave ovens and lightbulbs. This can help in reducing the payback period and increase savings per year. Today, it is also possible to affordably automate parts of the home to reduce electricity use. Examples include installing motion detectors and thermal camera systems which switch off lights once the last person leaves the room. Most electronics such as game consoles, microwave ovens and air conditioners can also be automated to switch off if not used for a set period. This conserves power and reduces unnecessary battery drainage (leading to a longer lasting solar battery). Solar system maintenance and running costs per year are minimized and will reduce the time taken for the solar system to pay for itself. Making these changes around the home is not expensive; there are innovative products online dedicated to reducing domestic energy consumption available at affordable rates. ·In this way, they reduce one’s financial burden. This also has an impact on solar energy payback period. Ultimately, the average electricity bill is reduced. In the long run, this could even benefit your credit rating.
The average cost of acquiring the system: the costs of acquiring these systems and installing them determines the payback amount per year, as well as financial savings. Industry experts advice on installing newer, energy-dense solar panels which convert a high percentage of sunlight into electricity. It may cost more to buy them, but one would end up with more electricity and subsequently a shorter payback period. The long term financial ramifications of this are also positive. It may then not be necessary to buy many solar panels, reducing the project total price. The adjuncts such as batteries, wiring and charge controllers need to follow this general principle. The final price may be slightly higher than installing standard solar panels, but the former are more capable of paying off faster in the long run since they make more electricity per square foot. Energy dense solar panels offset a high amount of electricity in a smaller footprint, which can save money and space.
The United States and other western governments seeking to reduce carbon emissions in as few years as possible encourage the use of green energy. They do this by providing one with a tax credit, cash rebates and other incentives. In the United States, one can claim a tax credit equivalent of 26% of the installation rate if they install the solar panels before 2023. This is a federal incentive, and individual states also provide incentives in the form of cashbacks, further state tax credits and some rebates depending on the state. A tax credit or other key rebate can be used to make installation of a solar unit cheaper. This significantly reduces the net electricity rates. The rebates and incentives go a long way in cutting down the cost of new generation photovoltaic cells.
The duration it would take for solar panels to pay for themselves is thus reduced significantly, and the average cost of installing solar units can be cut by more than half. One therefore need not necessarily worry about the financial ramifications or making the investment or ruining their credit to get a solar panel since they would save from the get-go.
Prior to investing in such a system, potential clients are advised to go through the state and federal laws in this domain to find out what benefits they stand to gain either instantly or over the years to come. Ignorance of these benefits may make one not take advantage of them. They may then bear the burden of a cost that they originally would not have to. Current government incentives such as tax breaks are time-sensitive, and may not be available in slightly over 10 years. It would be wise for one to think about installing solar units now rather than later. The pay back is significantly higher when the incentives are in place. Installing solar units much later results in a remarkably lower pay back.
Increasing electricity rates
The demand for electricity is set to go up. Currently, the monthly price of electricity and fossil fuels is ever increasing. Humanity is depending on electricity for automation, electric vehicles, automated homes and many other functions which gasoline engines and generators may not be able to fulfil. The rising demand for electricity and its sparse supply is a major problem for policy makers, most of whom do not see easy ways to reduce the electricity generation rate per person. When the monthly price of electricity spikes and an individual depends on a solar energy system that they had put in place several years back, they are likely to recoup the cost of the investment even sooner than expected, and will save more. When this is combined with the rebates and taxes mentioned above, it is not unrealistic to see some people recouping this cost in under 5 years and making more savings than initially thought. As explained, the fastest way to recoup the investment capital is by insisting on more advanced solar panels and associated accessories. This quickly and significantly reduces one’s electric bill.
Solar panel degradation and maintenance
Solar energy units take maintenance to keep them running smoothly. This can increase running costs per year and erode established savings if not done well. It also increases the duration you will need to break even. A solution to this is installing advanced (but tried and tested) solar utility systems. Current systems have a lifespan of over two decades and will require little maintenance per year apart from occasionally removing debris from the solar panel surface. Professional solar utility placement ensures that one will get the maximum output from the size of solar panels chosen, reduced degradation of the battery pack and an increased lifespan of other system accessories such as the charge controller and other electronics. To be safe, one can install the system with a long guarantee duration, so that they can get added value to the utility. They can also get professionals to inspect the system.. This will minimize degradation of all the solar panel system components and maintain the highest output possible from the solar panel. The user will have successfully gotten a reduced electricity rate and will also get more value for the amount of money spent.
Solar panel placement
Solar panels should be oriented so as to get as much power out of them as possible. Their size should also ensure that they produce the amount of power needed by the homeowner. Solar rays should hit the surface of the solar panel in a perpendicular manner most of the time to produce maximum power. The entire surface should also be exposed irrespective of its size at all times. Some solar panels are installed with motorized swivel mechanisms which follow the sun’s position and therefore are always producing energy at optimum capacity. The solar panel will not only meet or exceed your needs, but also quickly reduce the time taken for them to pay off.
This is a basic idea of how one can estimate the duration of recouping the costs of installing a solar/renewable energy system, and the factors that can affect this duration. In summary, how long does it take for solar panels to pay for themselves? Many variables exist in solar panel use, and these have the capacity to influence this. As long as you consult a professional in the field, they should be able to advice you on technicalities such as what size to get without making it necessary to compromise elsewhere. Your cost of electricity will ultimately reduce, and you will save a lot.