Adding smart solar to your home isn’t just about getting clean, renewable, independent energy; it’s actually cheaper than paying the electric bill. In fact, as rates climb, most customers see monthly savings grow rapidly when compared to their public utility.
There are also government incentives like the Federal ITC, state programs, and many local rebates that exist to encourage homeowners to switch to solar. Read about some of them here.
A typical homeowner in the United States uses over 1,200 kWh of power per month, and pays roughly 13.86¢ per kWh, for a bill of $166.32. In many states, including California, prices are much higher; with an average of 19.17¢ per kWh and bills in excess of $230. And that’s just today, rates across the country go up by between 1% and 4% each year, so you’ll be paying more for the same energy tomorrow.
Payments for a solar install almost always represent a DECREASE in monthly cost, never go up, and add value to your home - essentially paying you back for the power you use!
This is a rate structure made mandatory in California in 2019, and it charges a peak rate during the time when people use the most electricity, the daytime. Under these plans, costs can balloon to over 43¢ per kWh, leading to astronomical bills for a power utility with a less-than-perfect record for reliability.
Solar rates never vary because you own your power production, and they won’t go up over time. You’ll save compared to electric bill today and save even more tomorrow!
Even without battery storage at your home, you never waste the power you produce with a solar system. Any excess you produce can be put back into the electric grid. That’s right, your electric meter will run backwards! So, if you’re at work during the day and your home is sitting idle, the power you’re producing is sold back to your electric utility.
That night, when you turn on your lights, the power you draw from the utility is free, you’re simply taking back what you loaned them!
With a battery backup, you can store power for your own use and be sure to have enough to last even the longest of late-night parties…
A self-powered home is one that runs off solar and Powerwall, which gives you the ability to own your energy and reduce your reliance on the grid. With Powerwall you can use more of your solar by storing the excess solar energy and using it at night, doubling the usefulness of your solar panels.
Time of Use (TOU) Rates
Utility rates are higher during certain hours.
Time of use (TOU) rates refer to utility rates that are higher during certain hours when peak usage occurs due to overall higher demand. These rates are put in place to associate with the larger power demand and increased strain on the grid. What does that mean for you? In the end, a larger electric bill when you use power during peak rate hours. TOU rates are much harder to calculate because the rates fluctuate throughout the day, rather than a flat rate multiplied by the amount of electricity you use in each month. This can make it tricky to estimate what your bill is going to be in a given month, but in general your rates will be going up in the evening every day.
An example of this comes from PG&E’s website.
Peak rates are from 4pm-9pm every day.
Off-peak rates are outside of 4pm-9pm every day.
A graphic depicting general TOU rates from PG&E’s website.
This means you will be paying more for electricity between the hours of 4pm and 9pm. If you do not own solar and you want to save money on your utility bill, you should reduce power usage during these hours. However, if you are an owner of solar panels, most of the time you need not worry about peak hours at all because you power your own house. Your solar rates won’t fluctuate because you are your own source of energy. This is yet another reason why going solar equals huge savings.
Net Metering 2.0 (NEM 2.0) is a California update to the original net metering structure. It was implemented in 2019, to succeed NEM 1.0. The reason 2.0 came along stems from the rules of the first net metering structure. Net metering is the process of utility companies awarding credits to solar panel owners from excess power generated by their panels. Those credits are then used when households use more electricity than they are producing (like during the nighttime hours), so you end up spending even less on electricity. NEM 1.0 instituted a cap of 5% total solar energy demand for net metering to be available. That cap was rapidly approaching in 2016, and so NEM 2.0 was put in place. The original concept of ‘selling’ your power back to the grid and only paying for the ‘net’ of your power usage was preserved, but a few other things changed:
TOU plans are now mandatory - The time of use plan is now required. The solar industry has since adapted to this change, as most solar panels are placed in such a way that will generate more power during peak hours - shaving off some of the costs associated with TOU.
Interconnection Fee - Owners of solar panels under 1MW (1,000kWh) now must pay a one-time fee between $75-$150. The vast majority of residential solar systems are under 1MW.
Non-Bypassable Charges (NBC) - Small charges added to total electricity rates, usually only 2-3 cents per kWh. These charges are not added to the credit for excess electricity ‘sold’ back to the grid, meaning you will earn a small amount less back than you pay for electricity under net metering. While this is a drawback, it is only a small amount of your total electric bill.
Going solar can save you a ton of money from TOU rates. Check out our interactive solar calculator to see how much you can save by switching to solar.
Net Metering
Get credited by your utility company for excess power you generate.
Net metering is available to residents in certain states that allow it. It is the most common incentive that utility companies offer, and results in even greater savings for owners of solar panels. Net metering works with utility companies giving you credits for excess solar electricity that you produce, and sending it back into the grid - you essentially ‘loan’ the utility company your electricity when you produce too much. Those credits are then used up when you are using more power than you produce, and they give back what you loaned them. This ensures optimal efficiency by always using the solar power you generate, leaving none to go to waste.
During the spring and summer months, you will usually end up producing more power than you use due to greater numbers of sunny days and more intense sunlight. But during the winter months, you end up using more power than is being produced. Net metering effectively smooths over this disparity with the credit system - ensuring greater efficiency for your solar system. This also comes into play with the day/night cycle. During the daytime you are producing more power from sunlight than you use, and during the night you are using more power then you produce. Your excess daytime credits are simply applied to the nighttime hours when there is no sun to power your panels.
Massachusetts
Minnesota
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Montana
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New Hampshire
New Jersey
New Mexico
North Carolina
North Dakota
Ohio
Oklahoma
Alaska
American Samoa
Arkansas
California
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Connecticut
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Guam
Iowa
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Oregon
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Puerto Rico
Rhode Island
South Carolina
U.S. Virgin Islands
Vermont
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Washington
Washington, D.C.
West Virginia
Wisconsin
Wyoming
If you don’t live in one of the places listed above - don’t worry. Other states like Arizona, Georgia, Hawaii, Louisiana, Mississippi, and Utah have some form of mandatory compensation in place, while other states like Illinois, Indiana, Kentucky, Michigan, and New York are transitioning from net metering to another form of compensation.
It reduces strain on your local power grid, especially during peak hours and periods.
Your excess power generated can power nearby homes, increasing grid efficiency.
It allows consumers to reduce energy waste as a whole, as excess power is being distributed evenly.
With little effort, homeowners will use fewer natural resources and contribute to protecting the environment.
With Net Metering in place, homeowners can save tens of thousands of dollars on electricity over the lifetime of their solar panels. Since you are only paying for the ‘net’ amount of electricity you use each month, your power efficiency goes through the roof. Learn more about the different types of ways solar can save you money on our savings page.
Solar equals savings.
Check out our interactive solar savings calculator to see how much you can save.
Our goal is to save you money, free you from the dependence on unreliable utility companies, and help you contribute to a more sustainable future. Every home is unique, as are the needs of each consumer, but the math almost always works in your favor when it comes to switching to solar.
A full consultation using our 3D-imaging of your home will provide a more precise calculation of how much you can save, but below you can estimate just how much a solar system can save you…
*Savings are for illustrative purposes only. Actual savings may vary.
