ARE SOLAR PANELS WORTH IT? LET’S DO THE MATH.
Updated: Nov 5, 2019
By Phil Taylor-Parker | October 18, 2019
Is solar worth it for the typical homeowner in 2019? That’s the question we’ll set out to answer in this article. (Here’s a quick summary, though: if you own your home and connect to the grid, the answer is most likely “yes.”)
Some background for context: the solar industry has experienced rapid growth in recent years. In 2009, less than 20GW of solar capacity was installed worldwide. In 2019, that number has skyrocketed above 480GW—a rate of 24x growth in just a decade.
That growth has been made possible by rapid technological advancements. In the same timeframe, the cost of a fully-installed system dropped from $7.14/watt in 2010 down to around $2.50/watt in 2019. That means you can go solar today for about one-third of what it would have cost 10 years ago.
So solar is getting cheaper, and the technology is improving all the time—but does that make it better than other options?
Free Solar Panel Guide
To answer that, it’s not enough to compare the cost of solar against historical benchmarks. We have to look at how solar stacks up against alternative methods of delivering power to your home, because solar is really only worth the investment if it can outperform the other options on the market.
For grid-tied systems, the math is pretty simple: compare the cost of solar against the cost of buying power from the utility company. Don’t worry—we’ve written this article to walk you through the math.
The math in this article focuses on grid-tied payback period, but the process can be applied to evaluate off-grid systems as well. Instead of utility power, though, you’ll need to compare solar to the costs of running a power line to your property (if possible), or look at alternative power sources, like wind, hydro, or a trusty generator. Sometimes a combination of methods (like solar + a backup generator) may be the smartest option.
How Solar Pays For Itself
Grid-tied homeowners buy electricity from the local utility company at a set rate. The national average in the US is around 13 cents/kWh (source).
When you go solar and connect to the grid, that bill is reduced (or completely eliminated) because you are generating your own power instead of buying it from the utility.
To figure out whether going solar is a smart investment, simply compare the lifetime cost of utility power against the lifetime cost of going solar.