Many people mistakenly believe that installing solar panels only makes sense in sunnier regions. And it’s true that states like California have more energy generation potential than states like Massachusetts or New York.
But the financial attractiveness of solar ultimately depends on 2 additional factors:
- The cost of installing solar. The less money you have to pay for your system, the more appealing PV technology becomes.
- The price of grid electricity. As utility rates increase, the relative cost of going solar decreases. In other words, switching over to solar energy becomes comparatively cheaper than continued reliance on the electricity grid.
So the real question is, do you live in a region where the nominal and relative costs of going solar are worth it?
Chances are, you do.
A Quick Look at US Electricity Rates across the Nation
Although exact numbers vary from state to state, grid electricity prices keep trending upward. There may be occasional dips here and there, but as a general rule, you are paying more for power today than you did yesterday. And you can expect to pay even higher prices in the months and years to come.
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The reasons behind these rising utility rates are easy enough to understand:
- Fossil fuel resources like oil, natural gas, and coal are becoming harder to extract. And thus, they are also becoming more expensive.
- America’s energy infrastructure is many decades old. Improving and maintaining the country’s outdated utility network requires huge investments of capital. And those costs are ultimately passed on to you, the consumer.
- You also have to factor in the environmental costs associated with our heavy reliance on fossil fuel. Again, the consumer pays for this—both directly (i.e. oil spills and cleanups) and indirectly (i.e. poor health and polluted air).
By contrast, solar PV installation costs keep trending downwards—all over the country.
According to the International Renewable Energy Agency (IRENA), solar panel prices fell nearly 80% from 2009 to 2013. And panel costs continue to go down with each passing year. State and federal solar incentives are helping to drive down costs even more.
As these 2 trends converge—rising utility rates and falling solar costs—we move closer and closer to solar grid parity. This is the point at which installing a PV installation costs the same as continued reliance on traditional grid electricity.
When Will Solar Grid Parity Finally Happen?
Solar grid parity isn’t some futuristic concept. Many states have already reached this point. And some have even surpassed it.
If you live in Arizona, California, Connecticut, Hawaii, Nevada, New Hampshire, New Jersey, New Mexico, New York, or Vermont, you’re in luck. Installing solar panels is a much better investment than buying all of your electricity from the utility grid.
It’s worth noting that states like Vermont, New Hampshire, and New York aren’t regions of the country you’d normally associate with warm, sunny weather. And yet, going solar in these northern states is cheaper than staying on the grid.
What If You Don’t Live in a State with Expensive Grid Power?
If you don’t live in any of the above states, you might still be in luck. Solar grid parity has already arrived for 42 of America’s 50 biggest cities. This is because grid electricity prices tend to be higher in major urban centers.
In fact, nearly 10% of Americans (30 million people) already live in a market that has reached solar grid parity.
And that number will only rise as utility power becomes more expensive and/or solar power becomes more affordable. Many predict that the entire country will reach solar grid parity before the end of 2016.
Does Going Solar Make Financial Sense for You?
You’ll never know until you begin exploring your options. Contact us today for a free consultation. We can tell you (in advance) how much money you stand to save by switching to clean solar power.
Schedule your free appointment today.