Current techniques such as tax rebates do appear to have stimulated the solar industry. However, the urgency of climate change, as well as widespread carbon monoxide and sulfur dioxide pollution, require the quickest solution possible.
There are various ways in which solar system development can be stimulated more quickly. One policy idea of mine is discussed below, followed by a simple consumer idea.
Former Maldives President Nasheed installing solar panels on his home. Photo Credit: 350.org/ Mohamed Ali (some rights reserved)
Government-Provided Interest-Free Loans For Residents
Tax rebates cover 30% of the cost of residential solar systems. However, prospective buyers will still have to find the remaining 70% of the enormous cost of a solar system, so they are still not willing to do it.
Instead of giving tax rebates to solar panel buyers, that can be omitted in exchange for an interest-free loan that covers 100% of the cost of a solar system, so the government does not have to sacrifice the money paid into rebates, but would get it back via loan repayments. With government borrowing rates as low as they are today, this option seems to make a lot of sense.
From the point of view of someone that wants solar panels, but doesn’t have the large sum required to buy them, an interest-free loan sounds absolutely divine!
(By the way, please be wary of loan offers from financial institutions that seem too good to be true. Interest on regular loans is very costly, and can significantly increase the cost of solar systems, extending financial payback time, and reducing the attractiveness of going solar.)
The main reason I would recommend arranging for the loan to be paid when buying the solar system, rather than reimbursing the buyer afterwards, is because that is much easier for the buyer, which usually cannot find the money in the first place.
Start Small
Have you ever heard the saying that everyone has to start out small?
Due to the high cost of loans with interest (in general), you can completely avoid loans by literally buying the equipment for your solar system one panel at a time.
You can start using the system immediately after the first installation.
In the first place, you would first have to buy a charge controller and an inverter that can support the full system once it has been scaled up to its full 3-4 kW size (depending on the house).
Apart from that, you can start out with a single 230-watt panel, for example, and offset your electric bill a bit.
Maybe a few months later you can buy a second panel to add to it, and a third, etc, until you have your full-sized system at a far lower cost than you would with a loan, plus a much shorter financial payback time.
