Now more than ever, electricity is at the center of human activity â€“Â from heat and light to security, social life and entertainment. But nothing is free in this world. From our monthly power bill to the effects of our energy dependency on global politics and the environment, we are increasingly aware of the cost of our high-powered lifestyle. But how can we be part of the solution while saving our money and our planet at the same time? Questions like this are driving more people to consider solar power for their homes.Â Here are four solar incentives for homeowners:
There are a few different ways to harness the sunâ€™s energy for electricity. Chances are youâ€™re most familiar with photovoltaic solar panels, which convert sunlight into energy at the atomic level. The average American home consumes around 11,000-kilowatt hours (kWh) annually. By installing a solar array of 25-30 panels, you can easily generate this much power â€“Â if not more. In some circumstances, itâ€™s even possible to sell your excess solar power back to the grid. More on that in a moment.
Although the International Renewable Energy Agency reports that the cost of solar panels has dropped by more than 80 percent since 2008, the initial expense of going solar can be daunting. Depending on your householdâ€™s power needs, it could cost $25,000 or more for installation and setup. You can either buy the panels yourself or find a solar company that will install and rent the system to you. Despite the cost of the rental, youâ€™ll still have a noticeably lower power bill.
In other cases, the excess power you generate can help pay off the installation â€“ albeit very slowly. You may also opt to pool resources with your neighbors and form a solar community. This decentralized power generation reduces the need for big power plants and helps distribute energy more evenly, thus reducing power outages and total energy costs.
The Federal government has encouraged the growth of solar providers and introduced tax incentives to help offset the cost of going green. The following incentives can help take the bite out of this investment in your energy future.
Federal Tax Credit
The Solar Investment Tax Credit (SITC) allows homeowners to claim up to 30 percent of their solar installation costs on their taxes. If youâ€™re setting up a $30,000 system, thatâ€™s a $9,000 incentive. However, itâ€™s a limited-time offer as the SITC is set to expire at the end of 2016.
State and Local Governments
It offers their own tax incentives and rebates. For example, in several states, the value of the solar equipment is exempt from property tax assessments. Many cities will help with the cost of installation through rebates for local solar companies, which helps get your neighborhood on track toward self-sufficiency while stimulating the local economy.
Loans and Grants
It’s available throughout the country. Check websites like http://programs.dsireusa.org to see which energy-saving options youâ€™re eligible for in your state, county and city to help cut down on the amount youâ€™ll need to pay out of pocket.
Remember when we mentioned selling electricity back to the grid? This is accomplished through a system called net metering. A billing mechanism that credits solar energy system owners for the excess electricity they distribute back to the grid, net metering allows you to donate the solar power you donâ€™t use in exchange for a credit on your power bill. In almost every state, there are laws that regulate net metering or its equivalent.
Because solar panels donâ€™t have moving parts and are pretty durable, your solar array can last up to 25 years without significant maintenance â€“ although the panels gradually produce less power over time. Still, a solar energy system represents a solid investment in your householdâ€™s energy security, and both the price and technology are sure to get better over time. For renewable energy, itâ€™s a brand new day.