How Much Money Do Solar Panels Save on Energy Bills?

Homeowners have their choice of many solar kits they can buy to install solar panels on their rooftops to supplement their current systems. The panels create a charge that can be stored in a battery and used later to help cover the cost of many utilities. While solar panel systems can be expensive to buy and install, most can save owners money if they are used properly in the long term.

Solar panel installation
Solar panels can save around $50 per month.
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Solar Costs

Solar panel installation
The cost of solar panels varies.
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Solar panels range in cost based on the size of the system owners choose to install. A common rule is approximately $6 to $9 per watt of electricity that the solar panels produce. If you want to largely replace other electricity sources for a single family house, a full solar system can cost as much as $40,000. Most systems are smaller, however, and cost only a couple thousand dollars, not including installation.

Variables

Energy efficient house.
Electric costs vary from area to area.
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Solar savings can be difficult to judge because of the many variables at work in every solar panel setup. For instance, climate and weather can make the same solar panel create a completely different amount of electricity. Solar panel technology is increasing in efficiency, so a newer system will be able to convert more energy to electricity than older versions. Electricity costs also differ from area to area, changing the savings that owners earn.

Benefits

Tax Frustration
There are tax incentives for installing solar panels.
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Another important factor in solar panel savings are the associated benefits that homeowners can receive by installing the solar panels in their homes. There are federal tax benefits that help take care of some of the solar panel cost, in addition to temporary incentives and benefits that states may also offer. This means that homeowners may be able to save 50 percent or more of the upfront cost of the solar panels.

Savings

twenties and fifties
Savings average 50$ a month.
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While many factors affect solar panel savings, the average solar panel system that produces about 430 kWh per month can save around $50 per month in utilities. In December, these number fall to around $30 per month, while they can rise to $60 or more in summer months, especially in sunny climates.

Payoff Term

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Ideally the panels will pay for themselves in five years.
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The payoff term is how long owners need to use a solar panel system before it pays for itself and they start saving money directly on utility costs. A good general payoff term is five years, but highly efficient systems in sunny climates may have terms a year or two shorter, while systems in rainy climates may have terms as long as 10 years.