Is Solar Worth It In My State? Solar Panels Costs And Savings

Solar panel installations have taken off in the past few years, but is solar worth it in your State?

This post will present you with enough information to give you a shrewd idea if it’s worth-while financially, how much you can expect to pay and how much electricity your system will generate in your State.

Is solar worth it?

As a general rule, solar panels are worth it in your state due to a combination of the Federal Tax Rebate, Net Metering buy-back rates set by the utility companies, and State incentives, such as sales tax and home improvement tax exemptions. The average solar power payback time in the USA is just 8 years.

In the post below you’ll find answers to specific questions such as:

• How many solar panels do you need to power a house?
• What can you expect when solar panels are installed?
• How much does solar power cost in your State?
• Do solar PV panels need maintenance?
• How much power will solar panels generate in my State?
• What size solar power system do you need for your home?

First of all, a quick run-down of the basic parts of a domestic solar panel installation and how it’s installed.

Note: If you don’t need this, you know all you need to know about solar systems, just skip to the Page Contents Menu below and choose your State to see the solar statistics for your location.

DIYSolarShack partners with Renogy Solar – everything you need for DIY home solar. 

What is needed for a solar power system?

The most common form of solar installation for the home is called a grid-tie system. The installation needs local permits to mount and also to connect to the electricity grid. Your installer normally takes care of this bureaucracy and the cost is included in the installation price.

Components required for a basic solar power installation

1. Solar panels and roof mounts
2. Solar power inverter
3. Cables and junction boxes
4. Monitoring and metering
5. Energy Storage (if required)

This article isn’t intended to give an in-depth explanation of how a solar power system works, but rather provide essential basics and the practical aspects of installing the components, so that you, the homeowner, is better equipped to make the right choices.

The video below follows a fairly typical installation in Virginia step by step – a video speaks a thousand words!

Video – Solar panel installation process Virginia

The only thing I would say about the equipment used is that micro-inverters were installed, which is a growing topology. (Topology refers to the way the system is configured.) An inverter converts the DC voltage generated by the panels into the AC power needed by our home appliances – every system needs them.

Micro-inverters do the power conversion at the panel level and are fixed to the back-plate of each one. The majority of domestic installations use string inverters, which carry out the DC/AC power conversion for several panels connected together, normally up to 10. The arrangement of solar panels is called a ‘string’, hence the name string converter.

If you want to learn more about inverters, try this page – all about inverters. For an in-depth treatment of designing a home solar system by our resident expert, go here – designing a solar system.

How long do home solar systems last?

The solar panels are the most durable part of the system and generally come with a manufacturer’s warrant of 25 to 30 years. However, they will go on generating electricity for much longer than that and could last 50 years or so, with gradually decreasing power output of about 0.8% per year.

Panels are sold with a product warranty which will guarantee a certain percentage production capacity with the passage of time. For example, 90% output after 10 years and 80% output after 20 years.

A system installer may also give an equipment warranty, whereby solar panels would be replaced if they failed completely with 5 years (extremely unlikely) or an inverter fails within a specified number of years in service.

Actually, the inverter is the weak point in the whole system and generally comes with a warranty of 10 to 12 years. Panel-based micro-inverters and power optimizers have a much longer life.

On grid solar system connection diagram

The drawing below shows the basic layout of a typical solar installation:

The black arrows show the flow of DC current before being converted to AC, the red arrows show the flow of AC power and the green arrows show the power taken from the utility grid.

Note: The Net Meter in the top right hand corner shows current flow in both directions. This is the beauty and one of the major selling points of grid-tie solar systems – electricity produced at peak times is fed back into the grid and is metered as a credit to the home-owner.

House appliances pull power from the solar panels before using grid power, but if there is under-production due to cloud cover, for example, the system automatically draws from the grid.

What are solar buy-back rates?

In 2020 the federal government extended the tax credit for home-owners through 2021, but at a reduced rate of 22%. This incentive, plus the prevalence of the electricity buy-back rates at retail prices, make solar very attractive still.

However, several states are phasing out the practice, either reducing the rate or eliminating buy-back altogether. Check the situation in your state before making any decision – it could significantly affect the payback period for your solar installation.

President Biden recently announced a new solar initiative for the coming decade that should extend the financial incentives for home-owners.

What is the average payback period for solar panels?

The average payback period in the US is about 8 years, but this varies according to the State electricity costs and the amount of insolation, or peak-sun-hours, in your location.

How do you calculate payback period for solar panels?

A very simple estimation can be found by dividing the cost of the solar system, minus tax credits, etc, by the annual savings. This is best illustrated with an example using the website globalsolaratlas.info to find the amount of energy falling on the solar panels.

Are solar panels worth it in Houston, Texas?

Solar Payback Calculation For A 5kW Solar System In Houston, Texas

Is solar worth it in Texas?

• Location: Houston, Texas
• Average size of solar panels in Texas: 5kW
• Cost of solar installation = $13700 – 22% federal tax credit = $10686
• Peak-sun-hours in Houston, Tx = 1552
• Electricity generated by solar panels = 1552 x 5kw = 7760 kWhrs (kilowatt-hours)
• Cost of Houston electricity = 10.98 cents/kWh
• Amount saved per year = solar production x elec cost = 7760 x 10.98 = $852
• Payback period = cost of solar / annual savings = 10686/852 = 12.5 years

The payback period may be considerably less than this – your solar installer will give you an accurate assessment based on location, installation orientation and tilt angle.

Is solar power worth it in Texas? Read more.

Does adding solar panels increase home value?

Although different surveys (NATIONAL BUREAU OF ECONOMIC RESEARCH) find different rates of home value increase due to solar, it’s generally agreed that a home’s value increase by between 3.5% to 4%. Of course, this depends on the size of the solar array, but it seems most homeowners can depend on around 4% value increase with a solar system of 5 to 6kW.

The following tables shows the states showing the biggest increase in value after solar installations, with median home prices and percentage increase:

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Zillow shows than the added value for Texas is between $6000 and $8000, with the median home value of $200,000. That said, realtors are finding that buyers are willing to pay much more for homes with solar panels installed.

It makes solid economic sense. Not only are the utility bills drastically reduced, but the value accumulates for future sales. When you consider that utility rates have increased by an average of 2.9% per year for the past 15 years, it’s a win-win situation.

What factors affect solar panel efficiency?

Some of the factors affecting a system’s solar panel output we can influence and other we cannot:

1. Insolation or peak-sun-hours. The amount of sunshine over a period of time
2. Shading. Panels need to be installed in an open position away from structures and trees
3. Maintenance. Panels should be cleaned twice a year – losses can be between 5 to 15% due to dirt
4. Ensure the best quality panels are installed, with optimum output and low-light performance
5. Orientation. Solar panels arrays should point South if at all possible
6. Tilt angle. Too flat or too high can reduce production significantly
7. Heat. Efficiency reduces by 0.5% for every degree C over 25 (77 degrees F)

What orientation is best for solar panels?

Orientation refers to the direction the solar panels point to. In the Northern hemisphere it’s best to point directly South. Of course, not all roofs have South facing roof-slopes and so installers have to compromise and take variations into account.

Solar panel arrays may point South East or South West, or even West or East but never North. If an array faces North then it never sees direct sunshine and output is right down.

Direct sunshine is the best but diffuse sunlight energy plays a big part in energy production – quite large variations in direction do not mean that a solar system in your location is out of the question.

What is the best tilt angle for solar panels?

If a solar panel is truly fixed and can’t be moved at all, then 60 degrees is the best angle to optimize electricity production throughout the seasons.

Some installations have the capability of seasonal tilt angle adjustment. In this case the best angle in summer is the location latitude minus 15 degrees and in winter the latitude plus 15 degrees.

The table below shoes the difference in output over 12 months for Houston, Texas for a tilt angle of 60 degrees compare to ‘flat’.

Table – Insolation values over 12 months for Houston – production Vs tilt angle

The majority of domestic roof-top solar installations are fixed according to roof orientation and tilt. The required production needs are met by simply adding more panels, as the price per watt represents a lower cost than sun-tracking, either manually or automatically.

If you want to check the variation in peak-sun-hours for your location, go to this irradiance calculator, enter your state/city and view the information.

The heat problem is addressed by the installer leaving air gaps between the panels and the roof, while regular panel cleaning helps to maintain optimum energy production levels.

By far the biggest factor affecting production is the level of insolation, or peak-sun-hours, in your location. It’s this value and your home’s energy consumption that are the major factors a designer uses to size a solar system.

How to measure home energy use

Although it might be some use for a new build, or an installation destined for off-grid use, thankfully it isn’t necessary to work out energy consumption by assessing individual appliances.

It can be tricky assessing the energy consumption of individual appliances, particularly with devices such as refrigerators and air conditioning systems that use compressor and motors with inherent surge currents.

By far the most convenient way to assess consumption is from historical records i.e. last year’s utility bills, either viewed or by request from your provider.

Once your installer has the peak-sun-hours for your location and the amount of electricity your home uses, he can size the solar system needed. You can estimate this yourself by using the calculator below:

How many solar panels do I need for my home? Calculator

Typical sizes for domestic solar panels are between 225 and 350 watts – be sure to enter the wattage in kW, so 300 watts is entered as 0.3kW. 300 watts is a common size for domestic installations,

The calculator adjusts your energy usage upwards to account for the various losses that occur in solar systems. (Post on this site detailing solar losses here.)

Go to the website https://globalsolaratlas.info/, enter the insolation for your location (this value is also known as ‘peak-sun-hours‘) and the calculator will show the number of panels needed to cover your energy usage.

Solar calculator – How Many Solar Panels – Solar Sizing

Table – Major elements of cost for a solar panel installation project

As you can see from the above table, almost 50% of the cost of an installation can be saved by installing solar panels yourself. The cost and payback period of a DIY solar system become extremely interesting for anyone concerned about their budget.

Many homeowners have gone down this path and recorded their results on Youtube. It’s quite easy with careful planning and the final grid connections and permits could be handled by a professional – it’s probably worth the extra payment for someone else to navigate the bureaucracy.

There are posts on DIY Solar Shack which go into great detail about the installation design process.

If you have solar panels and the power goes out do you still have power?

A standard grid-tie system disconnects from the grid when the power goes off for safety reasons, to protect repair teams possible working of the grid. If any domestic solar systems remain connected, then repair teams could be in danger. It’s called ‘islanding’ and inverters include anti-islanding circuitry to cut solar output from the grid.

Should I get a battery for my solar panels?

An off-grid solar system isn’t connected to the grid and uses a battery bank to ensure continuity of power during night-time and outages. Can a grid-tie solar system also use batteries? Yes, the Tesla Powerwall is the perfect example.

Video – How do Powerwalls work?

A powerwall is a collection of interconnected lithium-ion  cells with an overall capacity of 13.5kW and comes with a 10 year warranty. It can be used with or without solar. With solar, it charges up in the daytime when the sun shines, or from the grid if production is low.

The powerwall is a smart device, that is, it can detect when it needs to charge, where it can be charged from (grid or solar) and when it needs to switch into supply mode. It can be monitored by mobile phone apps or Wifi, and also has the capability of being controlled manually at a distance by computer or phone.

The technology has generated a lot of interest after the long-term power outages in Texas. Although 1 powerwall would only suffice for basic power requirements over a 12 hour period, for example, several linked together would be needed to supply a house for longer than a day. Up to 10 powerwalls can be connected in tandem.

With a sufficiently large solar installation and number of powerwalls, it’s completely possible to operate for an indefinite time without grid power, if necessary. (Off-grid solar system design.)

What does residential solar cost?

The table below shows the installation costs per watt for each State valid March, 2021. For our example, Houston, Texas the price per watt is $2.74. In fact, the vast majority of US States have installer prices of less than $3 per watt.

Table – Average Energy Consumption, Solar Panel Payback Period & Peak Sun Hours By State

Is solar tracking worth it?

During the year the sun changes it’s movements on a daily, and also a seasonal basis. On a daily basis the sun rises and falls in an arc across the sky, from East to West in the Northern hemisphere. The angle at which the sun’s energy hits solar panels therefore varies and so does the power production.

The cost-effectiveness of a tracking system depends very much on the individual installation parameters, but for the majority of installations it offers little benefit. The capital cost is high compared to the production gains, gains that can easily be matched by adding a few more panels at a cheaper cost.

How does solar tracking work?

Across the seasons the height of the sun’s arc changes, thereby varying solar production according to its angle. These movements can be separated into two axes, vertical and horizontal.

An automatic sun-tracker has sensors which detect the sun’s strength and moves the solar panel array so that it is always perpendicular to the sun’s rays. In this way the angle of incidence is always kept at the optimal, which is 90 degrees.

A system that tracks the sun horizontally is called a single axis tracker and one which tracks both is called a dual-axis tracker. In general, the dual-axis tracker recovers more energy but is consequently more expensive.

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Related Questions

Why solar panels are not worth it?

As a general rule solar panels are worth it but there a some circumstances that could change the situation.

Here are some reasons why solar panels many not be worth it for you:

1. Your location is completely shaded by adjacent buildings severely reducing solar panel output
2. The irradiance (peak-sun-hours) in your geographic location is too low solar power to be viable
3. There is no solar electricity buy-back program in your state
4. You do not own your own home or are otherwise ineligible for Federal Solar Tax Credits
5. Your roof or yard is too small to mount enough solar panels for your needs
6. Your roof may not be strong enough to support solar panels

What are the 2 main disadvantages to solar energy?

The two main disadvantages of solar energy are:

1. Solar panels cannot store electricity for night-time use
2. Solar panels are inefficient at around 20%

It’s a sad fact that, even though the conversion process is clean and the systems are  long-lasting, just 20% of the sun’s energy reaching a solar panel gets converted into usable electricity.

Compare this to solar water heating, which is more than 70% efficient at transferring the sun’s heat energy to water storage.

Solar panels need good direct sunlight and the output can be low if clouds pass or it’s a dull day. They generate nothing at all at night and so battery storage is needed, plus extra solar panels to charge the batteries.

Are solar panels worth it 2022?

The main reason why grid-connected solar panels are worth it in 2021 is that the Federal Tax Credit has been extended until the end of 2023.

You need to check on your state for electricity buy-back rates and electricity costs to find out if solar is worth it for you in your particular location.

Do solar panels hurt your roof?

No, solar panels will not harm your roof in any way if professionally installed.

A home roof (in general) is designed to support a 300lbs ‘spot’ load. That’s to say, it can support a 300lb AC unit in one location.

A 5kW solar system could consist of 17 solar panels of 300 watt rating each. Such a panel weighs around 40lbs, so about 680lbs spread over an area just over 300 square feet.

The solar panels are mounted on and bolted to aluminium rails so the weight is evenly spread across the roof timbers.

When is solar not worth it?

Solar is worth it when the capital cost of the installation is paid back reasonably quickly by the energy saved throughout the year.

In the USA the average payback period is about 8 years and is dependent on local insolation values and energy buy-back costs.

How do you calculate if solar is worth it?

Multiply the power rating of the solar installation by the number of the annual peak-sun-hours for your location to find the kilowatt-hours of energy produced each year.

Multiply the solar energy produced by in kWh by the cost of electricity per kWh. Divide the cost of the solar installation by the cost of the annual solar production to find the number of years need for payback.

Are solar batteries worth it?

Solar batteries are worth it if you intend to live off-grid with no utility connection, or live in an area that suffers frequent power outages. Solar batteries charge up during daylight hours and power the home at night or during power outages.

Is solar worth it without net metering?

Grid-tie solar is not worth it unless net metering is installed. Net metering feed over-production of electricity back into the utility grid and the home-owners account is credited, normally at retail rates.

This means that the credits can be used when there is under-production of solar electricity, therefore reducing utility costs significantly.