Solar energy is erupting with price drops and tax credits

For now, solar energy itself is still free. Gathering and converting that energy into electricity creates the cost, and traditionally it’s an expensive upfront investment that took many years to recoup. Pair that with the ease of paying for power incrementally sourced from the grid and most consumers stick with what they know: electricity generated by burning coal.

That’s changing. Power from utility companies is rising -- 5% over the last 38 years. Using that baseline, maintaining the style of living we’re accustomed to will require increasingly more cash for energy. Investing in a set of photovoltaic cells is one way to step outside those price hikes, and recouping costs from an installation like that can happen in as little as 8 years. But how much does a solar installation cost up front?

It varies widely depending on the home, but in Santa Barbara where the sun shines almost every day homeowners are spending $15,000 to $20,000 on average after rebates, according to Noozhawk. Sound pricey still? The U.S. government agrees. Homes that achieve 50% energy savings over the pre-established 2004 International Energy Conservation Code are eligible for a $2,000 tax credit. Additionally California offers rebates based on other performance factors.

Say a homeowner received $3,000 in tax credits and invested $12,000 outright to install photovoltaic cells. To break even on cost in 8 years, the homeowner would need to be paying about $125 per month in electricity currently. That’s also in a region with lots of sunlight and houses requiring that much electricity.

Notably, homeowners also have to keep the aesthetic of their houses in mind. City ordinances require a certain “cleanliness” in some communities, which can become troublesome if the solar panels are installed in a manner considered “unattractive”. Normally solar companies assist with that piece. We can’t have renewable energy getting in the way of aesthetics after all.