Solar: The Safe Investment
For many years, solar has been considered a frivolous purchase for only the richest of environmentalists. Until recently, solar was as valuable as the statement it made about the owner. However, as the technology improves, so does its feasibility. The benefits of solar go beyond offsetting fossil-fuels; solar’s low costs offer a sizable and relatively risk-free return on investment for those looking to cut costs in the long run.
Similarly to financial investments, solar offers a return on investment in the form of money saved from lower energy costs.
However, unlike financial investments, the returns on solar investments are much more predictable. Production from solar panels is fairly consistent on a year-by-year basis. The sun shines and will continue to rise everyday. Even when accounting for cloud-cover, weather doesn’t drastically differ from year to year, so it’s not difficult to make accurate predictions about how much solar energy will reach the panels. Once a solar system is installed, almost no outside factors come into play. Sure their could be a mechanical or electrical issue that arises, but without any moving parts, such problems are rare while the maintenance is easy. Although government incentives may change, they only affect the value of the SREC's, which make up a fraction of the system's return. Factor in the 20-30 year warranties that many solar installers have and a solar system’s lifetime production is all but guaranteed
So what kind of return on investment can be expected from solar? The payback period is partially determined by government incentives, which differ from state to state. Since we are an Ohio based company, government incentives include a federal tax incentive that offsets 30% of the cost of any system. With these incentives, a very large solar array will usually pay itself off within 4 to 9 years. For smaller, residential systems, it take about 8 to 15 years. Considering that the life cycle of a solar system is upwards of 30 years, it’s not unusual for solar systems to pay themselves off 2 or 3 times over.
Although the upfront cost of solar is still relatively high, solar is still considerably cheaper than many believe it to be and an investment that will truly show its worth.