Solar power adoption has hit the roof in the Bay state. Driven by declining solar panel costs, government incentives, and increasing utility prices, solar panels lead the change to green power in the state.
But, the question on everyone’s minds is – Is solar a great choice for just the environmentally conscious, or is it a financially wise decision for everyone?
Let’s take a hard look at the factors at play.
Sheer Cost Savings in Utility Bills
An average household in Massachusetts consumes 627 kWh of power per month, which attracts a bill of roughly $107.
The day you go solar, most homes will be able to produce enough power to stop incurring monthly electric expenses for the next 25-30 years, which is the average lifespan of high-quality solar panels. This translates to savings of $38,520 in utility bills alone over a 30-year period.
Cost of a New Solar Power System
As we already know, the average Massachusetts household requires 627 kWh of power per month. To meet this power requirement, you’d need a 5-6 kW solar panel installation. The price for such a system is in upwards of $20,000.
So, when you compare the price with the potential 30-year power savings, you are already in profit with your new solar panel system. However, there’s more to this puzzle.
Federal Solar Tax Credit
The federal solar tax credit gives you a flat 26% tax credit on your income when you buy a solar power system. You can deduct 26% of your solar power system’s value from your federal taxes. That’s a good 26% effective discount on your system, as long as your federal taxes are enough to take advantage of this tax credit. If not, this incentive can be carried over year to year.
So, you effectively pay less than $20,000 on your 6kW solar panel system, perhaps closer to $15,000.
The new Solar Massachusetts Renewable Target program, which replaces the SREC program, offers all residential solar buyers a fixed incentive on every kWh of solar energy they produce for a span of 10 years. The incentive is fixed at $0.22368 to $0.34000 per kWh of solar power generated. The actual incentive is determined based on multiple factors.
When you enroll in this program, you may get as much as $1,979.16 per year in incentives.
When you factor in all the savings and potential earnings you could realize from your solar power system, you soon realize that you recover your power system’s cost in roughly 6-7 years or even earlier.
So, yes! Solar panels are definitely worth it in Massachusetts.