Breakeven On Current Solar Panels

Dividing 14 200 by 1 734 gives a solar payback period of about 5 8 years even if electric rates don t go up between now and then.

Breakeven on current solar panels.

The typical solar payback period in the u s. If your cost of installing solar is 20 000 and your system is going to save you 2 500 a year on foregone energy bills your solar panel payback or break even point will be 8 years 20 000 2 500 8. As of sep 2020 the average cost of solar panels in ohio is 2 5 per watt making a typical 6000 watt 6 kw solar system 11 118 after claiming the 26 federal solar tax credit now available. Currently the break even cost of pv in the united states varies by more than a factor of 10 from less than 1 watt to over 10 watt despite a much smaller variation in solar resource.

Solar panels are typically under warranty for 25 years so that s the standard figure used for the lifetime of a system although it s often much longer. Therefore those 10 200 kwh will save them an estimated 2 450 in one year. The solar energy our friend s panels make earns them an average of 24 cents per kwh. Is just above 8 years.

You ll break even after 8 years and start generating a return on your investment. If your break even point is reached within 5 years and you expect to save at least 2 000 a year for electricity assuming you purchased the system with cash then you benefit from around 20 years of no electricity bills about 40 000. The average efficiency of solar panels falls between the 17 to 19 percent efficiency range. This is lower than the average price of residential solar power systems across the united states which is currently 2 60 per watt.

On average upfront costs are 11 000 with savings of 1 400 per year on foregone energy bills. In 2019 it takes 30 off the cost of a home solar system. In the united states the most important incentive for solar is the federal residential energy tax credit. The tax break reduces.

An average sized residential solar system about 400 square feet of solar panels costs 18 000 according to the solar energy industries association an industry group. This year most homeowners are paying between 2 87 and 3 85 per watt to install solar and the average gross cost of solar panels before tax credits is 16 800 says energysage s data. This credit drops to 26 in 2020 and 2021 22 in 2022 and then will drop to zero after that unless renewed again by congress. The highest efficiency solar panels on the market today can reach almost 23 percent efficiency.

How is the solar panel payback period calculated. If a solar panel has 20 percent efficiency that means it s capable of converting 20 percent of the sunshine hitting it into electricity.