The state of New York provides a handful of solar power incentives, depending on where the solar power system is to be installed. For example, if it is to be located in the Con Edison service area, the incentive for a residential system would be between 20¢ and $1 per watt.
So, if your home solar power system was 5,000 watts, you could get help from the state $1,000 to $5,000. If the incentive is 50 cents/watt, the state would provide $2,500. Then combine that with the federal tax credit, which is 30% through 2016, and the cost would be decreased considerably again.
How much is the cost of a home solar power system in New York? A recent article pegged the cost at $4 per watt, so a 5,000 watt system would be $20,000, but with incentives, the cost would be about $12,000, depending on the state’s contribution.
Is that price still unaffordable? What if you wanted a 7,000 watt system? It’s the same formula: $4 x 7,000 minus incentives. So, $28,000 minus about $10,000 is only $18,000, and that’s for a large home solar system. The more typical size seems to be 5,000 watts.
The true cost will probably be even lower, though, because New York also offers a state tax credit for home solar power systems that is 25%. So, a 5,000 watt system could be less than $12,000 and a 7,000 watt system less than $18,000. For the 7,000 watt system, the payback might actually only be 4 years, because of all the incentives and the rising cost of electricity from utilities in New York.
The website Solar Power Rocks actually ranks New York #1 in solar power because it is one of the best states for purchasing solar power. New York might seem an unlikely candidate to be a leader among American states in solar power, because it does not exactly have a tropical climate. New York actually has ample sunshine, but that’s not what makes it an American solar power leader — it is the statewide policies created by the legislature that try to help people buy their own home solar systems. (In fact, Germany is a world leader in solar power, but is further north than New York.)
You might say that’s great for people with money, but not for low-income folks, but incentives for low-income homes can be double that of others.
Increasingly, solar power is an investment with an attractive return — it is not just a ‘nice’ or ‘green’ thing to do. It is an investment that can make money, and real estate is a very common investment. In fact, a homeowner might first think of landscaping or updating the kitchen as ways to increase the value of a house. However, adding a home solar power system might be a better way.
In fact, research has shown that doing so can increase a home’s value a great deal and help it sell faster, “Researchers found that buyers were willing to pay a premium of $15,000 for a home with the average-size solar photovoltaic system (3.6 kilowatts, or 3,600 watts), compared with a similar home without one. Put another way, that translates to about four additional dollars per watt of solar power.”
Remember the cost figure of $4 per watt for a solar power system? Well, if you could sell your house for an extra dollar amount that is about the same as the cost, the system might effectively be free.
If you saved $1,000-$2,500 per year by generating your own electricity, how much would you have after 5 or 10 years? Five years of saving at $1,000 per year is obviously $5,000, so you would have made some money — and 10 years of savings at the same rate would be $10,000. That’s the conservative estimate. If you could save $150 per month, that would be $1,800 per year or $18,000 in 10 years.
Who doesn’t want to increase the value of one’s own home and save money on utility bills? Solar panels can also help keep roofs cool in hot weather and slightly warmer in cold weather. So, you might need a little less air conditioning and heating. The amount of savings related to these effects will be very small, but they also should not be completely overlooked.
Solar power typically has not been given credit for all of its benefits. Today, those include potential financial gains that had not been available a decade ago. The mindset that many Americans have today is that solar power is a good thing to do for the environment, but that it loses money. This view is simply untrue in a large number of case, maybe most cases. Today, because of the dramatic drop in solar prices, it could be something that is good for the environment and makes money.
Image Credit: Mwanner, Wiki Commons