Are Solar Panels Really Worth It
A payback period is the amount of time it takes to earn back your initial investment. Solar panels can help you save enough money on energy bills over time to offset the upfront costs. How much you save per month depends on the size of your solar system, your home’s energy consumption and other factors.
Calculating the payback period will be unique to your circumstances due to the variability of the upfront costs, as well as the difference in energy costs based on your location. But here are some guidelines to help you estimate when you will break even.
Estimate How Long It Will Take To Pay Off Your Solar Panels
First, multiply your solar panel cost by 0.26, which is the tax credit you receive for installing your system. If you spend $20,000 on it initially, your tax credit is $5,200. That takes your initial investment down to $14,800.
Now, let’s factor in energy savings. Divide your initial investment by the $1,500 you typically pay the electric company per year that’s how long it’ll take for your savings to equal the amount you spend. Using the example above, you’d divide your initial investment of $14,800 by $1,500: The result is a payback period of just under 10 years.
That might seem like a long time on the surface, but solar panels can easily last 25 years.
You can further expedite your payback period by selling renewable energy certificates, or RECs. These are measured in megawatt hours of electricity that come from a renewable source. Electric companies must purchase some electricity from renewable sources, meaning you could save more by selling energy generated by your solar panels.
Liens On Your Home Vs Liens On Your Solar Assets
A lien is a legal claim that a lender has on an asset which can be executed if a borrower defaults on payments or tries to sell the asset before its fully paid off. So just like a mortgage lender has a lien on your house and an auto lender has a lien on your car, solar lenders like Mosaic have a lien on your solar equipment . And just like that house or car, the lien on solar equipment, meaning the claim on the asset, remains in place until the loan is paid off.
When selling your home, there are two ways to deal with the solar lien: either the new homeowners need to first qualify for and then assume the loan and the lien along with it, or you need to simply pay off the balance of the loan, such as with proceeds from your home sale, which will trigger the release of the lien. Your solar panels likely increased your home sale price due to the added value of your solar system, and using that value to pay off the solar loan in escrow is usually the easiest option. This option also avoids the risk of the homebuyer failing to qualify for the solar loan assumption, which happens in some circumstances.
Thats the short version, and if that seems straightforward, youre right it is! So why is this a source of confusion for some mortgage lenders?
Due to the amount of questions we receive about this, Mosaic has enlisted the help ofGreg Field, an experienced Solar Home Realtor in Phoenix, AZ to explain why this might occur.
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More Ways To Effectively Grow Your Business
Are you now considering new ideas and methods to generate more solar installations? If you would like further reading about succeeding in the competitive world of solar power, visit our information center for more industry advice and expert tips.
Here at Solerus Energy, were in the business of helping solar contractors of all types and sizes. In addition to our selection of premium solar equipment from the worlds top manufacturers, we offer complete solar design, permitting, and administrative support to make your business more efficientand let you get on with what you do best.
We hope that your sales team spends less time knocking on doors and more time signing new customers.
Solerus is a trusted solar energy equipment supplier, empowering contractors to develop agile solutions for commercial and residential clients. We provide a range of best-in-class solar products that are backed by an industry-leading 25-year warranty, designed to provide you with unparalleled peace of mind.
To learn more about reducing solar customer acquisition costs and the equipment youll need to have happy customers at a price that youll love, feel free to contact one of our knowledgeable specialists today!
D Have A Separate Bank Account For Your Solar Panel Distribution Business
When starting a business from home, it is important to distinguish between the costs of the business and personal costs.
Distinguishing between personal finance and business finance allows individuals to be able to set up a budget for their costs, review their spending, and figure out whether they are making profits or losses from their home-owned business.
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Not Checking The Solar Panel Warranties
When selling a home with leased solar panels, its important to check the warranties for the solar panels. Sellers should be aware that they may be responsible for any damage or defects to the solar panels during the sale of the home.
Its also important to check whether or not the seller is obligated to transfer the lease on the solar panels to the new owner. If not, there could be additional costs associated with transferring or terminating the lease agreement.
How To Sell Solar Panels
In this post, we are going to talk about how one can have a successful solar business. This is specifically for our dealers and partners and others who want to make the most of the growth rate in the solar industry.
Everyone today wants to become a successful entrepreneur and is looking for profitable business ideas. The simple answer to know which business to start is to look for a business that is growing and the future prospects of the industry. Solar industry is one such industry given the huge demand for electricity in the future with the rising population in our country. With the increasing demand, there will be a rise in the electricity bills as well. People will install solar panels to avoid the issue of rising electricity bills. Hence, there is going to be a huge demand for solar system installations. India is planning to move to renewable energy sources like wind and solar which reduces the power cost to a minimum and are green in nature.
Here we will tell the five ways that will help prospective businessmen and women achieve their dream of accomplishing a successful solar business.
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New Site Fuels B2c And B2b Revenue Growth
As told to BigCommerce by Valerie Duong, Marketing Supervisor, renogy.com
Currently, we sell a large number of our solar products to installers and dealers. In addition, we work directly with large organizations such as schools who want to buy in bulk for their facilities.
We operate as both a business-to-business and a business-to-consumer company, but we are experiencing higher sales on the consumer side. In light of these results, we are pushing our consumer line even more by developing products for every use, from tailgating at football games to camping.
While simultaneously redesigning our website and migrating to BigCommerce required a lot of preparation by our internal team, the transition was seamless.
After thoroughly researching leading ecommerce platforms, we made the decision to switch to BigCommerce.
Since launching on BigCommerce, we’ve experienced a 40% increase in conversion rate, 30% increase in revenue, and 20% increase in site traffic. “
How To Sell Electricity Back To The Grid
Theres lots of advice out there about how to save on your electricity bills. Turn off the lights when you leave a room, for starters. But what about making money from the electricity company instead of sending a monthly check? Yes, its possible.
If youre thinking about generating some renewable energy on your property, you should know that those solar panels can earn you money. Heres how you can sell electricity back to the grid:
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Dont Assume That Solar Panels Automatically Add To Your Resale Value
Solar panels can make a home more attractive to a particular set of buyers and help get an offer sooner and perhaps at a higher percentage of the list price, says Dan Hamilton, a top-selling agent in Palm Desert, California. But typically the solar systems dont add a material amount of monetary value to the home.
The takeaway is when you sell a house with solar panels, make sure you price it right. The jurys still out whether solar energy adds to your homes value so dont assume you can offset the cost of the entire panels in your list price. Instead, focus on how they can boost your homes marketability and streamlining the process of transferring your system to buyers.
What my experience is, for a lot of our buyers, especially ones that are going to make this more than just a winter residence and a full-time residence here, is that having the solar can provide some predictability with energy costs, Hamilton said.
Thats in sunny California, where Hamilton says: Solar is a big deal. In locations with long winters and rainy seasons, homeowners have to be extra careful to do their homework on the long-term savings of solar and package it to buyers in a clear way.
Solar Energy Rollovers And Reimbursements
Its not enough to know if your state or utility company allows net metering. You also need some understanding of the fine print, since not all net metering programs are created equal.
First, find out if net metering credit be rolled over from month to month. Similarly, what happens to unused credits at the end of the year? Do they expire? Are they paid out at a lower rate than monthly surpluses?
Its also important to determine whether your utility company charge a monthly connection fee. More importantly, find out exactly how much utility will pay for the excess power you produce through net metering.
The majority of states pay retail rates for surplus electricity so the utility pays you the same rate it charges when it sells its electricity to you. About 10 states, however, pay consumers avoid costs rates, which are basically what it cost the power company to produce its electricityand these are lower than the retail rate.
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Can I Store My Solar Energy
A great idea but it costs a lot more. One downside of solar panels is that you can only use the energy generated immediately that is, when you are at home putting lights on and running appliances. With a battery system you can store electricity to use later or sell back to your supplier either way making savings. But battery systems cost at least £4,000, so it will mean even longer until you have paid off the initial outlay.
Selling Your House With A Solar Lease Or Ppa
- Buy out the remainder of the lease: By paying the rest of your lease, you can either have the panels removed from your roof, or keep them there and sell the system as part of the property.
- Transfer the lease to the new property owner: If the new owner is willing to take over the lease and meets the third-party owners criteria, you can transfer the agreement over to their name.
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Benefits Of Selling With Solar
Increasing the value of your home and helping it sell up to 20% faster, are two of the top benefits a solar energy system offers to home sellers, according to Solar.com.
A study published through the Office of Energy Efficiency and Renewable Energy suggests that, in 2015, buyers were willing to pay $15,000 more for homes with solar panel systems than for comparable homes without.
There is no reason to believe those numbers will go down anytime soon, as companies and households nationwide show increased interest in sustainability.
Faster sales and higher offers from prospective buyerswhats not to love?
Well, these benefits only apply to solar panel owners. If you lease your system or have financed panels, you may run into a few snags with mortgage lenders and potential buyers.
Writing An Effective Business Plan And Strategy For Selling Solar Panels
After deciding that the solar panel business is the right fit for you and becoming an authorized solar panel distributor, you should write your businesss most effective business strategy.
An effective business strategy is one of the drivers of ensuring that a business will succeed. Since the solar panel business is booming at the moment, these entrepreneurs should take the leap and take advantage of the opportunity to get started.
Writing a good business strategy means acknowledging how to operate a business effectively.
A business owner can do this by acknowledging the weaknesses with a SWOT analysis, knowing the competitive advantages over other businesses, figuring out which companies they can outsource for solar installer services, and many other things that go into selling solar panels from home.
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What About Refinancing Your Solar Home
Refinancing the mortgage on your solar-powered home when theres a solar loan in place may take an extra step or two, but with the right preparation, you can ensure the refinance goes smoothly. Understanding your UCC-1 Filing and solar loan agreement is a critical step, and having this knowledge on hand will hopefully save you and your lender a lot of unnecessary concern.
When refinancing your mortgage, there are two ways to deal with the solar lien: either contact us and we will confirm to any mortgage lender that our lien is limited to the Solar Equipment and does not extend to any part of the Residence, or you need to simply pay off the balance of the loan, such as with proceeds from your refinance, which will trigger the release of the lien. Your solar panels likely increased your home value due to the added value of your solar system, and using that value to pay off the solar loan in escrow is usually the easiest option.
Alternatively, upon request, we may agree to lift our county fixture filing, if any, on the Solar Equipment for a limited period for a cost of $250 or more depending on costs incurred and whether we will be able to refile upon closing of the mortgage refinancing.
Want to learn more about going solar with a loan through Mosaic?, or,interested in growing your business by offering access to simple, affordable financing options for solar as well as batteries.
The Benefits Of A Solar System
Before buying or selling a solar-equipped property, you should understand the benefits and downsides of a particular solar system.
This way, you can be upfront with either your buyer or seller.
Although every system comes with a different payback period, most homeowners with solar panels eventually pay less for their energy than they otherwise would.
Solar panels can also increase the appeal of a home to potential buyers.
Did you know that homes with solar sell 20% faster than those without?
Hard to complain about that!
Financed Through A Solar Loan
If you financed your solar installation, check with the lender to see if transferring ownership is allowed. In most cases, it is okay as long as the new owners have a plan for continued monthly payments or can pay off what remains of the debt from purchase. If you choose this option, its a good idea to include the loan details in the home-selling paperwork to make the process smoother.
In some cases, you can sell the solar panels to a new owner for a lump sum or allow them to take over your payments as a solar buyout. It is worth exploring during escrow since it may save you money, and the buyer will have no qualms about continuing their service with an existing installer.
The benefit of this option is that there would be no monthly payment obligation in the future but as stated before, it may require a cash sale for between $1.00 and $1.50 per watt of the systems capacity.
Solar Panels And Home Value
It makes intuitive sense that the ability to generate your own electricity and the resulting energy bill savings would add value to a home, but what does the data say? A 2015 study, sponsored by the Department of Energy and conducted by the Lawrence Berkeley National Laboratory, looked at data from the sale of over 22,000 homes across eight states between 2002 and 2013. Of those homes, roughly 4,000 had solar panels.
The research confirmed what many had long thought to be true: home buyers are willing to pay more for houses with solar panels. On average, home buyers were willing to pay an additional $15,000 for a home featuring a 3.6 kW solar system . This was true across the eight states studied, their unique housing and solar markets, and different home types.
These findings were confirmed again by a report from Zillow that looked at sale prices and listings from March 2018 to February 2019. Zillow found that homes with solar panels installed sold for an average of 4.1% more than non-solar homes.
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