Report: Solar power now the ‘cheapest electricity in history’

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Solar power is now “the cheapest electricity in history,” according to a recently-released International Energy Agency (IEA) report. Sunshine is, and always has been, free–but harnessing it to power your home hasn’t always been cost-efficient. That’s no longer the case.

Thanks to both major improvements in solar technology in recent years, as well as to state and federal efforts to combat climate change, renewable energy is more affordable than ever. On top of that, solar installers are now facing high competition from rising consumer demand, meaning even lower prices for consumers.

At the end of the day, home and business-owners are seeing faster payback and greater savings from solar than ever before.

Understanding the Solar Return on Investment (ROI)

So what drives a positive return on a solar investment? In many ways, solar power is a financial product – one that is capable of generating annual returns ranging anywhere from 10 percent to more than 30 percent. Another way to think about a solar investment is by looking at how long it will take for a solar panel system to pay for itself. Based on solar panel systems installed through EnergySage.com, the country’s largest marketplace for consumers to receive and compare solar quotes from multiple pre-screened companies, solar typically pays for itself in just 5 to 8 years, before providing free electricity for the remainder of the system’s 25+ year lifespan.

There are a few key factors that influence the financial benefits of solar, including:

• Electricity rates: Electricity costs more in some parts of the country than in others. The higher your electricity rate, and the more you pay for electricity each month, the more you can save with solar.

• Financial incentives: At the moment, there are significant incentives for Aurora residents to go solar, including the federal solar tax credit. Higher incentives mean lower upfront costs and a shorter payback period for solar.

• Price: While prices for solar vary across the country, the best way to ensure you’re paying a fair price for the right system is to compare multiple solar quotes. Lower costs mean a shorter payback period.

• Property value increase: Zillow recently estimated that homes with solar panels sell for 4.1% more. Solar panel system ownership tends to increase your property resale value.

Solar payback period = solar panel ROI

Taking all of the above factors into consideration, Aurora residents can get an idea for what a solar payback period might be, which is the best way to put a number on your solar panel ROI.

Using a service such as EnergySage, which helps homeowners compare products and quotes across multiple local (and pre-vetted) installers is generally a great way to get started. And since solar companies are competing for business when consumers compare quotes, EnergySage consumers get (on average) 20% lower prices than outside of the marketplace.

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