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How to Decide if Solar Is Worth It

How to Decide if Solar Is Worth It - Solar Panels in the roof
Eric Donti
Eric Donti
May 19, 2023

The inflation over the last year has been unkind in a lot of ways. Food prices went through the roof, for example. If you were like most people, you probably experienced a bit of sticker shock with your electric bill. While there wasn’t much that people could do about things like food prices or gas prices, a lot of people were looking for ways they could trim those utility bills. There are always energy efficiency improvements that can offer incremental improvements. For big improvements, though, many homeowners started eying solar panel systems. The big question is how to decide if solar is worth it. If you’ve been on the fence, keep reading for factors that can help you decide if solar is right for you.

Your Location

House with solar panels

One of the selling points for solar is that it can work anywhere. That’s very true. Solar can work anywhere that you get sunlight. Of course, that doesn’t mean that solar is efficient or cost-effective everywhere. For example, let’s say that you live in Alaska. There are entire months out of the year when there is little to no sunlight. That makes solar all but useless for that part of the year.

Of course, there are other parts of the country that enjoy consistent sunlight. Homes in the Southwest, for example, get a lot of sunlight year-round. That makes a solar panel system much more efficient because it provides relatively consistent, ongoing power generation. If you live in a part of the country that gets a lot of steady sunlight, a solar panel system makes sense.

Your location also matters because electricity isn’t priced the same in all places. States like New York and California routinely see substantially higher electricity prices than other states. That makes a solar panel system particularly valuable in a place like California, as you get steady sunshine and you get a break from higher average electricity costs.


A lot of people worry about the upfront costs of solar. It’s true that a full solar panel system can run a bit on the pricey side. Of course, the true cost of a system depends on your home, which will be covered in more detail below. Even so, there are a number of incentives and programs designed to help you defray the costs of a solar installation.

The biggest incentive is the federal solar tax credit. In a nutshell, this program lets you reduce your federal taxes by 30 percent of the cost of your solar installation. Mind you, this is a credit, not a deduction. While you can use the credit to reduce the amount you owe to zero, you can’t use it to get a refund. That credit can make your solar installation a far less expensive proposition than simply buying one out of pocket.

Of course, it’s not just the federal government that’s interested in encouraging solar power. Many state governments are also eager to see homeowners invest in solar power as a way to slowly move away from fossil fuels and nuclear power plants. A number of states offer various rebates and incentives, such as cash rebates on equipment or property tax exclusions. Since solar installations often add to a home’s value, even temporary property tax exclusions can save you money while you reap the benefits of solar power.

You may even find local incentives from cities or utility companies, such as rebates or tax breaks. Of course, not all incentives are created equal. You need to take a close look at the incentives available in your location. If the incentives add up to serious enough savings for you, adding solar to your home becomes more practical.

Your Electricity Usage

Electric meter

Some homes are naturally more energy efficient than others. For example, modern homes often employ building strategies or materials specifically designed to boost the home’s energy efficiency. New homeowners often include energy efficiency improvements in their renovation plans. Beyond that, in-home electricity usage varies by lifestyle.

For example, a family of four with a lot of electronics like computers and gaming systems is going to use a lot of electricity. By contrast, someone living alone who doesn’t use a lot of electronics is probably going to see much lower electricity bills. If your electricity costs are substantially lower than those of your neighbors, for example, it can take you a lot longer to recoup the costs of a solar panel installation.

If your electricity usage is high or higher than your neighbors, solar can help you knock back that bill to something a bit more reasonable.

Your Home

When considering solar, you must also consider your home. Homes come in a lot of different shapes and sizes. Yet, a basic rule of thumb is that the bigger your home is, the more expensive it will be to run it. Even if you’re conscientious, keeping the lights on in a 5000 square foot home is going to run you a lot more annually than a 2000 square foot home with the same number of people in it.

That means the size of the solar panel system you need to, for example, fully replace what you get from the grid will be substantially bigger. As such, it will prove substantially more expensive. While you’ll still enjoy the same incentives as everyone else, your total costs for the system will still be higher. Of course, you will also see proportionally more savings when that system goes online and starts making electricity.

You must also keep in mind the orientation of your home. Solar panel systems work best on homes with good southern exposure. That southern exposure maximizes the amount of sunlight that the panels see over the course of the day. If your home has a good southern exposure, that’s a big checkmark in the yes column for how to decide if solar is worth it. If your home doesn’t have good southern exposure, other buildings block a lot of the light from that direction, or there are natural obstructions that can dramatically reduce the efficiency of a solar panel system.

Another factor you must consider about your home is your roof. A solar panel system means putting a substantial amount of extra weight onto your roof. Of course, the amount of weight will vary based on how much power you want the system to produce. Yet, your roof may not have the strength to support all that weight in its current condition. Many homeowners find they must reinforce their roofs before they can actually install a solar panel system.

Don’t forget about the shingles, either. While a solar installer can put a system over whatever you have on your roof, that system won’t extend the life of your shingles. If you have basic three-tab shingles on your home, you only get 15 to 20 years of useful life out of those. If you’re rolling up on needing to replace those, you may well want to replace your roofing before you get solar panels.

After all, you don’t want to put up a solar panel system to have to disassemble it in two years for a roof replacement. All so you can have an installer reassemble and reconnect the solar panels after the roofing replacement. The catch is that this is an extra expense that many homeowners don’t consider when they look into getting solar panels.

Property Value

Property value going up

As a general rule, a solar panel system will increase the overall value of your property. In areas like the southwest, you typically see a bigger boost to property values because solar panel systems offer more year-round benefits. While that may not mean much immediately, it’s worth considering if you’re thinking that you’ll sell the house down the road.

After all, not every house is a forever home. Some people know that they’ll only own a given property for so long before they sell it off. The thing you want to figure out is whether you’ll stay in the house for long enough that the boost in property value will be enough to offset your initial costs for the solar panel system.

Unfortunately, there is no easy equation you can use to determine if that’s the case. Local property values and the number of years you’ll stay in a house are too difficult to predict accurately. However, you can use best guesses to come up with a general estimate of how much the system will add to your property value. Then, you can use estimates to figure out how long you’ll have to stay in the house to get to a break-even point on the system.

If you know you’ll sell in a couple of years; the investment probably doesn’t make sense. If you think you’ll stick with your current home for another 7 to 10 years, the investment may break even for you at the time of sale. Plus, you got years of savings from the system in the process.

The Environment

Not every reason for installing a solar panel system is tied strictly to your budget. For many homeowners, the state of the environment is also a serious concern. Solar panels offer a way to make a real contribution to reducing manmade climate change. Minimally, a solar panel system reduces your total carbon footprint. Depending on the size and efficiency of the system, it may get that footprint down near zero.

Beyond that, though, solar power production directly reduces the amount of fossil fuels used in electricity production. After all, the more electricity that residential solar panel systems feed into the grid during the day, the less coal or other fossil fuels must burn to provide electricity. That reduction helps to limit the amount of greenhouse gases that end up in the atmosphere.

Granted, these environmental benefits are largely intangible on a month-to-month basis. Instead, some homeowners consider solar an investment they make in the future of the planet. Many others find that a bit too abstract and think of it as an investment in their children’s future. After all, today’s kids will have to live in the environment this generation leaves behind.

Deciding If Solar Is Worth It

An answer to the question of how to decide if solar is worth it must take a lot into account. For example, there is your location. Do you live somewhere where you get a decent amount of sunlight year-round? Then there are the available incentives. While federal incentives apply everywhere, can you expect any incentives from your state, local city, or utility company? You must also consider your home. How big of a system do you need to replace grid electricity? Do you have good Southern exposure? What kind of shape is your roof in? You should give some thought to whether you can break even on the investment if or when you sell the property. For some, there are also the more intangible environmental benefits of installing solar. You must consider all of these factors and decide if solar makes sense for your home. If you’re ready to seriously consider solar, though, head over here to get your no-cost consultation.