Still, the biggest obstacle for most families remains price: A typical-size solar project in the Washington area runs about $15,000. But you’ll get your money’s worth. A 26 percent federal tax credit and various state and utility incentives will help pay for a chunk of upfront costs and, over time, you’ll cover the rest by avoiding expensive electricity bills.
Because governments and utilities in D.C., Maryland and Virginia offer very different levels of incentives, how quickly you’ll recover your upfront costs depends on where you live.
D.C. residents will see the fastest payback period. Because its generous Solar Renewable Energy Certificate (SREC) program pays out high rates for electricity produced by solar projects, most homeowners with roofs that get a lot of sun will break even within just three years.
In Maryland, where the incentives aren’t quite as generous, breakeven would occur within about eight years.
In Virginia, because direct-dollar incentives remain small, the payback wouldn’t happen for about 12 years.
After that, because systems provide free electricity for years, most area residents over 20 years will come out ahead on their energy bills by $10,000 to $46,000, depending on where they live.
You can finance a solar project purchase and avoid the big upfront spend. Installers offer loans, or you can obtain a home equity line of credit. But that adds thousands of dollars in interest charges to your total cost. In some areas — especially in the District — there are also generous grants and low-interest loan programs available to low-income families.
Alternatively, D.C. and Maryland homeowners can sign on with a company that supplies equipment via a lease in exchange for paying it a flat monthly fee — typically $40 to $100 — and letting it collect the tax credit and incentives. (Solar leasing isn’t yet available in Virginia.)
At Checkbook.org, we discuss the pros and cons of leasing; in general, we don’t think these arrangements represent good deals. (Washington Post readers can access Checkbook’s full solar energy report, and all of Checkbook’s ratings of local service providers and related consumer advice, until April 1 via Checkbook.org/WashingtonPost/Solar).
Of course, many homeowners want to minimize their homes’ impact on the environment, regardless of any cost-benefit calculation. If you are in this group, solar for sure is for you.
No matter your motivations, you’ll have to make several decisions, and those decisions will affect how much you’ll spend upfront now, how much you’ll spend over the life of the system and whether you’re eligible for tax breaks and other incentives.
Start by making sure your abode and its roof are good fits for solar. Homes with roofs that have unobstructed southern exposures are the best sites. Because solar panels last for 25 years or more, and because your shingles will need equal longevity, ask a good roofer if you should replace shingles where you plan to install panels. If your roof is newer and still covered by a manufacturer’s warranty, ask your roofing contractor for written acknowledgment that the installation of solar panels will not invalidate the warranty.
Because Checkbook’s undercover shoppers found some installers recommended systems that were too large — and more costly — than needed, get your own estimate of the system size you need. Gather your electric bills for the past 12 months and tally how much power you used and what you paid for it. Then use various calculators offered by three handy websites to estimate what you need: the PVWatts Calculator from the U.S. Department of Energy (pvwatts.nrel.gov); Google’s Project Sunroof (sunroof.withgoogle.com); and the Solar-Estimate (solar-estimate.org).
If you’re planning to buy an electric vehicle in the next few years, add about 2.5kW of capacity per car to your system size.
Next, collect proposals from solar companies to supply and install your desired system. Checkbook’s undercover shoppers collected prices for two homes with typical projects and found big company-to-company price differences for each. For one home, prices ranged from $12,240 to $22,464 for a 4.8 kW system; for the other, prices ranged from $14,280 to $23,408 for a 5.6 kW system.
The lesson? Collecting several prices to identify reasonably priced installers can mean saving $10,000 or more.
⋅ Thoroughly vet solar contractors you consider. Skeptically review any marketing materials — some companies promise overly optimistic scenarios. Carefully read the contract and ask the company to clarify anything you don’t understand. Check for certification (to get Maryland’s rebate, you must use an installer certified by the North American Board of Certified Energy Practitioners (NABCEP). In the District, to get the rebate for low-income homeowners you must use an “authorized” company.
⋅ Ask how long the company has been installing solar energy systems. Has it completed at least 100 projects? Does it have experience getting permits approved in your jurisdiction and approvals to connect systems to your electricity utility? You don’t want your home to be a guinea pig for an inexperienced installer.
⋅ Make sure any installer you consider has an electrical contractor’s license, then verify it with the licensing authority. Also ask for proof that companies and any subcontractors carry liability and workers’ compensation insurance.
⋅ Find out how long it will take to get things done and when you’ll have to pay. As with most home improvement jobs these days, solar projects often take a while to complete because of supply-chain delays.
⋅ Look for a long-term workmanship warranty that will protect you if your system breaks down or doesn’t operate as efficiently as promised. Installers’ warranties can vary from one to 10 years; the longer, the better.
⋅ If you can, avoid making a big deposit before work starts. Usually, $1,000 or more is due when you sign the contract, and then another payment is due when installation begins, with the balance upon completion. By withholding as much money as possible until work is complete, you retain maximum leverage to make sure the work is done correctly and promptly.
⋅ Consider other steps to reduce your home’s energy consumption. Most of our homes unnecessarily waste lots of energy. Often, the combined effects of making inexpensive improvements, adopting better habits and buying better products will provide large savings. At Checkbook.org, we detail 32 changes you can make around your home that will save energy.
Kevin Brasler is executive editor and Jeff Blyskal is a senior writer at Washington Consumers’ Checkbook magazine and Checkbook.org, a nonprofit organization with a mission to help consumers get the best service and lowest prices. It is supported by consumers and takes no money from the service providers it evaluates. You can access Checkbook’s solar energy report, and all of Checkbook’s ratings of many types of local service providers, including HVAC, plumbers, roofers and more, free until April 1 at Checkbook.org/WashingtonPost/Solar.