Should You Consider Solar Power For Your Home? Read This Before Installing Residential Solar Panels

Michael and Jill Goodrich-Stuart live in their second solar-powered home. Their first one was a new build in an all-solar neighborhood, which meant the home’s price included its solar system. Six years later, they moved into another house a couple hours away. While Jill and Michael enjoyed their new home, they missed their solar panels and decided to install a new system.

“You pay a lot upfront, but we like saving on our bills each month. I also love the fact that we’re decreasing our carbon footprint,” Jill says. “I want my children and grandchildren to know we did what we could to help.”

More and more people are choosing solar for their home’s electricity needs. Like the Goodrich-Stuarts, some switch to renewable energy to help protect the environment. For others, the main goal is to achieve energy independence and avoid potential outages from an overburdened power grid. Many homeowners also hope to save money over time by reducing their energy bills and taking advantage of tax incentives.

Is Solar Power Right for Your Home?

While solar panels come with many benefits, they’re not a fit for every home. To decide whether solar power is a good decision for your home’s energy needs, consider the following factors.

How Long You Expect to Stay in Your Home

While solar panels can help you save money over time, they can be costly to install and maintain. Estimates vary on how long it takes to break even on the cost of residential solar panel installation. Some expect it to take between 10 and 20 years, while others estimate between five and 10 with an average of about nine years.

Relocating solar panels to a new home can be difficult and expensive, if not altogether impossible. If you don’t plan to stay in your current home for at least eight years, you may want to forgo installing solar panels. Of course, depending on your location and local market preferences, solar panels can increase your home’s value, though not usually by the full amount of their cost. 

Your Average Electricity Usage and Energy Costs

If your main reason for installing solar panels is to save money, make sure to calculate potential cost savings. Homeowners with high energy bills are more likely to benefit from installing solar panels. Gather your past energy bills to calculate your average monthly energy usage and cost. Your average monthly usage will help you determine the size and cost of the system you would need. (To determine how many solar panels you might need based on your energy usage, try using an online solar calculator.) Then you’ll be able to compare that cost to your average electric bill to determine potential savings and see how long it would take you to break even.

As you review your bills, you may find that your energy usage is low. This could be due to your home size, a small household, energy efficient lighting and appliances, efficient insulation or simply living in an area with low utility rates. Whatever the reason, according to Boston Solar, a residential solar contractor based in Massachusetts, if your energy costs less than $50 per month on average, then solar panels may not save you much money. That said, average residential energy bills below $50 are quite rare—all state averages are currently above $80 per month.

Your Eligibility for Rebates and Incentives

Find out if you’re eligible to receive a federal solar investment tax credit for installing a residential solar system. Depending on where you live, you may also qualify for a state incentive, so check the database of state renewable energy incentives.

You may also live in an area where utility companies compensate homeowners for surplus energy that flows back into the grid. This is called net metering. If your solar panels generate more energy than you need on sunny days, they’ll send the surplus to the grid, building up a bank of credits to use at night and on cloudy days. To learn more about net metering rates in your area, contact your local electric utility. 

Your Home’s Physical Characteristics 

Homes in sunny locations with little to no shade are typically good candidates for solar panels. Your roof also matters. Its layout, size and condition affect whether solar panels will work well for your energy needs. Consider these factors to determine whether your home is suitable for solar energy.

Geographic Location

If you reside in Arizona, or another of the sunniest states, you’re more likely to benefit from a home solar system than someone in the cloudy states of Washington or Vermont. 

Shade

If your home is shaded by large trees or other buildings, solar panels won’t capture and generate as much energy. On the plus side, your shady yard likely makes it easier and cheaper to keep your house cool in the warmest months of the year. 

Roof Condition

Is your roof strong enough to bear the weight of a solar system? If you need to replace your roof anytime soon due to damage or age, you may want to hold off on solar panels until after a new roof is installed. You may even be able to coordinate your roofing and solar contractors. 

Roof Size

The average American home needs between 15 and 19 solar panels to generate the right amount of electricity—and those panels take up space. To install 15 panels, you’d need about 264 square feet of roof space. But a small roof isn’t necessarily a deal breaker. You may be able to install additional panels on other structures such sheds, carports, gazebos or pergolas. You could also consider ground mounting panels in sunny spots of your yard, if it complies with local regulations.

Roof Orientation

The Department of Energy recommends installing solar panels on south-facing slopes for optimal energy production. If most of your roof faces a different direction, you may need to install more panels, which requires more space. 

Roof Warranty

Look into whether installing a solar power system will void your current roof warranty. If it will, you may want to ask solar installers whether they take responsibility for the warranty. 

Insurance Coverage

Homeowners may need to adjust their insurance coverage when they install solar panels, both to cover the panels and to protect against any liability exposures that may be associated with the panels. Contact your insurance company to ask what you might need to adjust and how much additional coverage will cost.

Keep in mind that unless you purchase and install battery storage (which can be costly) for your solar system, your home will sometimes need to pull energy from the grid. After all, the sun isn’t always shining. Fortunately, 41 states and four U.S. territories offer net metering which issues credits for surplus solar power that flows into the grid. If and when you need to draw power from the grid, your credits are automatically redeemed to reduce your electric bill.

How to Shop Wisely for Home Solar Systems

Once you’ve confirmed that your home is a good candidate for solar power, it’s time to start getting quotes. Comparing proposals from solar installers can be overwhelming, especially if you don’t know much about home solar systems. Below are some items to review and compare across quotes.

Types of Equipment for Residential Solar

First, it’s helpful to understand the components of home solar systems. Harnessing solar power for your home requires solar panels and inverters. The panels capture solar energy as DC electricity, and inverters that convert it to AC electricity which is used in your home. Solar panels are generally guaranteed to last about 20–25 years, while inverters are generally guaranteed for 10.

Things to Consider When Comparing Solar Panels

While there are differences across brands and types of solar panels, there are some easy ways to perform a quick comparison. Ask for a product specification sheet for each panel type in the proposals you receive and compare the following:

• Lifetime production. This is the expected percentage of power output after one year and after 25 years, including expected annual degradation. Some spec sheets will also include expected output after 10 years.
• Watts per panel. If you install higher-watt panels, you’ll typically need fewer panels overall.
• Panel efficiency. This is measured as a percentage of the total solar energy that gets converted into usable electricity from the sunshine on your panel. Residential solar panel efficiency can range from 13% to nearly 23%. The higher the efficiency the better.
• Low light performance. Compare how each panel behaves in low light situations. Panels with better “low irradiance performance” will generate more power at dawn and dusk and on overcast days. 
• Maximum ratings and temperature ratings. If you live in an area with extreme weather, confirm the panels will operate at various temperature extremes and won’t sustain damage under snow or hail. 
• Warranty. Look at the length of the warranties, the type and what they cover. Some only cover the actual product while others include warranties that cover performance and labor. Keep in mind that many warranties are only valid with installation by certified solar professionals.
• Brand. Research the brand of each solar panel. Look for brands with Tier-1 panels and a long, reliable reputation and positive business outlook. After all, a great warranty isn’t worth anything if the company goes out of business. 

Things to Consider When Comparing Inverters

Inverters can greatly affect your panels’ power output. Below are three common types of solar power inverters. As with panels, you also want to compare each brand’s warranties, product operating temperatures and efficiency ratings.

• Microinverters. These small inverters go on the back of each panel to capture their full output. This type of inverter is the most efficient, but it’s also the most expensive. Microinverters can be worth the cost if your panels face different angles, if you will have occasional shade on some of your panels, or if there’s a chance you could add more solar panels in the future.
• String inverter. Rather than many small inverters, this solution uses a single central inverter that caps the electricity production of each panel based on the lowest producing panel on your roof. While this means you lose potential output from higher performing panels, this type of inverter is less expensive than microinverters. If you’re not likely to see much variance between panels, a string inverter could be a good solution. This may be the case if all your panels face the same direction without any shading issues. Remember that if you add panels in the future, you may need to purchase an additional inverter. Also, if one panel gets damaged, it can lower your entire system’s output. Some people choose to add power optimizers to make their string inverter perform more similarly to microinverters. This adds to the inverter cost, but is still less expensive than microinverters. 
• Hybrid inverters. Hybrid inverters can convert electricity in both directions, from DC to AC and AC to DC. This means they allow panels to send their production either to the grid or to home-based battery storage. Hybrid inverters are the most expensive type and are typically used only by people who also purchase battery storage for their system (or plan to in the future).

What to Know About Battery Storage for Solar Power

Some homeowners choose to purchase batteries to store their surplus solar power for nighttime or cloudy day use. This option may appeal to people who live in areas that don’t offer net metering, or to those who simply prefer to be off grid. With enough battery storage, you can be fully energy independent and avoid power outages. Just make sure inform your local firehouse that your home has a PV system with a battery installed, which you can do directly or via proper product labeling. According to the U.S. Office of Energy Efficiency and Renewable Energy, online training is available for your local fire department through www.cleanenergytraining.org.

Most consumers, however, do not opt to buy batteries for their residential solar system. Not only can solar batteries increase your fire risk, as evident by several related product recalls, but people also often skip a battery due to the cost (and the fact that storage isn’t a necessity). While residential batteries are often eligible for the full federal tax credit, the typical cost ranges from $7,000 and $15,000 fully installed—and that’s on top of the rest of your equipment and installation.

How to Vet Installers

Do your research when deciding which solar installers you’d like to ask for a quote. Look at their websites, their Better Business Bureau ratings and online review sites. Look at how long they’ve been in business, whether they’re certified by the North American Board of Certified Energy Practitioners (NABCEP), and if they have positive ratings for their equipment, planning, installation and customer service. 

Once you narrow down a short list, meet with each installer so they can see your home and plan a proposal. During your meetings, ask each contractor about the number of systems they’ve installed, what types of equipment they use and why, which areas of the country they’ve serviced, what warranties they offer, financing options available, and whether they have experience working with your local utility company.

Finally, pay attention to whether they make a detailed review of your roof and your average energy usage before planning a system for your home. 

Questions to Ask Residential Solar Installers

There’s a lot to cover when vetting and selecting the right installer for your home solar system, but it’s effort well-spent. Experienced solar companies can help ensure that you use quality materials and that they’re properly installed to perform at maximum efficiency, reduce potential fire hazards associated with improper installation, and offer guidance on system maintenance. We’ve put together a list of questions to help you cover every topic. 

Questions About Their Experience and Knowledge

• How many years have you been in business? What about in my area?
• How many systems has your company installed?
• How much experience do you have working with my local utility company?
• Are you NABCEP-certified, licensed, bonded and insured (ask for the license number)?
• Will I need to change my insurance coverage?
• What incentives and rebates are available to me?
• Can you provide customer references?
• If I install solar panels, how will that affect future roof repairs?
• Do you recommend battery storage? Why or why not?
• What happens if I sell my home?

Questions About the Equipment They Use

• What types of equipment and which brands/products will you install and why?
• What type of inverter do you recommend for my home and why?
• Will you provide a monitoring app for my use? If not, do the inverters you use come with one?

Questions About Their Process and Service

• How do you design the system and forecast estimated output?
• Do you use subcontractors for any part of the installation? If so, are they licensed and insured, and how do you vet them?
• Who paperwork is required for local permitting, HOA approval and utility connections? Are any related fees already included in my quote?
• How do you confirm that my roof is structurally sound for the long term?
• Do I have the right to cancel and when do I lose that right?
• Can you provide a project timeline from signing the contract to a powered-on system?
• Will an electrician be onsite during installation?
• Do you actively monitor my system’s performance after installation?
• What is the process for reporting any issues post-installation?
• Who can I contact with questions both during and after installation?

Questions About Warranties

• What do your warranties cover and what is excluded?
• What are the equipment warranties?
• Will my system come with a performance guarantee?
• Will installing this system void my roof warranty? If so, do you take over responsibility and what does that include?

Questions About Financing

• What financing options do you offer?
• What is the payment schedule?
• Will my monthly payments change if I take the tax incentive as part of my tax return?

What Every Home Solar Quote Should Include

You’ll have more confidence when a solar installer’s proposal includes all the key details—and it’ll be easier to compare with other quotes. Here’s what a complete proposal should include:

• An itemized list of equipment, including: solar panel make and model, inverter(s) model, racking and a monitoring system (plus any extra charges or fees for upgrades or installation challenges)
• Explanation of installation warranty, including system defects and labor (this should also apply to any work that is subcontracted)
• Total system size in kilowatts (kW)
• Diagram of the proposed system layout on your roof
• Expected efficiency and energy production in kilowatt-hours (kWh) per year, including whether they offer a performance guarantee and what happens if the system doesn’t perform to expectations
• Total cost, including information on which rebates and incentives you qualify for, show both as an upfront payment and a monthly cost if financed
• Projected savings per year based on estimated annual utility price increases
• Information on all warranties (equipment and workmanship)

When comparing installers’ quotes and processes, the key features to weigh include:

• Equipment used by each installer
• Warranties offered
• Financing options and terms
• Project timelines and management responsibility, including whether you’ll keep the same point of contact throughout the process
• Reputation for customer service and their communication and responsiveness thus far

If you’ve shopped for residential solar energy, we’d love to hear about your experience and what you learned. Share your insights in the comments below!