When a person takes on a financial liability, like car or house payments, they look forward to seeing the notification “paid in full”. There’s a deep level of satisfaction knowing that you’ll never have to send more money for that thing every again! The same is true with purchasing a photovoltaic system, but there’s something more. Many solar panel owners expect a payment for any unused power they generate, to help cover the solar investment even sooner.
With or without excess energy payments, it doesn’t take long to pay off a solar panel system in California. With a house, it usually takes about 20 or 30 years. With cars, it takes a little less time – the average new-car loan in 2020 had a duration of 6 years. With solar panel systems, however, the variance is a little wider. Average solar panel installations in California take anywhere from 2 to 8 years to pay off. Why the difference?
Factors in Calculating Solar Panel Value
At Solaron, our agents go through a veritable sea of programs, loan offers, incentives and options to get you the best deal on your photovoltaic system. Even so, there are plenty of factors to consider when helping you choose the best photovoltaic system.
Energy Habits – a household with two people will not use as much electricity as one with six people (especially if that larger household includes a few teenagers). Also, how many items in your home are energy efficient, using less power? Does your stove or clothes dryer use gas or electric sources? The more energy you use, the more panels you might need, and that could increase the time it takes to pay off the system.
Home Size – a large roomy house is going to take more electricity to maintain its internal temperature than a small, cozy cottage. Less panels on a larger home might be quicker to pay off, but the system provides less in utility savings. Conversely, a large system with a smaller home might keep you off the electrical grid, but its your service provider and the market that ultimately decides how much you can earn in electricity buybacks.
Energy Storage – using a battery backup is an optional component for your photovoltaic system. It stores electricity in case you need it during a power outage or late at night, when the panels cannot convert sunlight to electricity. Adding this component might increase the time it takes to pay off the system, but having the peace of mind that you’ll limit the moments you are without energy is worth it.
Net Metering – this is a key factor for many people in paying off their systems. Net metering refers to payments from your utility company to your account. Your unused, un-stored electricity is sent into California’s power grid. Your utility company is responsible for metering the amount and either paying you or giving you credit for the electricity you’ve provided. That extra money for the unused power or lower electric bills helps to pay off the system quicker.
There are other factors that might come into play, depending on your circumstances. That’s why it’s so beneficial to get a free solar analysis from Solaron. We take a look at your energy consumption, your home configuration, your potential for net metering, and many other options, like government programs or incentives to help with the cost. Please give us a call or schedule your free solar analysis online to find out how long it would take for your solar panels to be “paid in full.”