How to Use the Solar Calculator
The best way to learn about local rebates, your home’s energy potential, and your eventual return on investment is to use our ModSun Solar Cost Calculator (see above). Enter your home address in the box, then click Check My Roof. You’ll get an instant picture of your roof’s productivity, your average energy expenses, and installation costs in your area—whether you decide to buy or loan. We’ll also provide system size recommendations and information about rebates and incentives you may be eligible for. Just select More Info under each purchasing strategy to learn more, and then connect with a solar pro.
Solar Buying Guide for Pennsylvania
Pennsylvania property owners considering the installation of a solar panel system in their home or business have a variety of options. Many decisions are necessary to get the process started and successfully install your solar system. This guide will introduce you to solar system basics and get you started in the right direction so you can enjoy the many benefits of solar energy in Pennsylvania.
Pennsylvania Climate Considerations for Going Solar
Pennsylvania residents experience a diverse climate due to its multitude of geographic features. The second state of the union straddles two climate zones with the southeastern corner experiencing the warmest temperatures. Solar power requires sunshine to create electricity, and with an average of 207 days of sunshine in Philadelphia, Pennsylvania’s climate is suitable for solar power. Although the climate varies according to area and altitude, Philadelphia experiences hot and humid summers with cooler temperatures in the mountainous regions. Average rainfall is 43.8 inches with 19.8 inches of snowfall and an average of 119 days of precipitation. Residents can expect temperatures during the winter — January — to average 25.8 degrees and will vary depending on region.
Solar Investment Options
One of the first important decisions you will face when installing solar panel system is how to pay for it while getting the best return on your investment. Although the costs of solar panel systems have decreased significantly, installing a new system on your property will require some upfront expenses to cover the costs of equipment and labor. Unfortunately, many property owners do not have the cash on hand to purchase a system out right and require other methods to pay for the installation.
The three most popular methods to obtain solar systems are purchasing them outright with cash, using a home equity line of credit (HELOC),and a lease or power-purchase agreement. Below you will find a brief explanation of the three methods:
- Lease or power-purchase agreements, often referred to as third party ownership, are a great option for property owners without the available cash or equity. Although in the beginning you will pay about the same amount for electricity as you would through a utility, you will realize savings over time as the cost of the lease will rise less than the expected annual utility rate hikes.
- Purchasing a solar panel system using a home equity line of credit “HELOC” provides a ROI “Return on Investment” almost equal to a cash purchase. Although you are paying interest on the loan, when combined with the 30 % federal tax credit and payments spread out over 15 years, it could have less impact on you than using your own cash.
- Cash is king and using yours to purchase your solar power system outright will provide you with the greatest return on investment as you will not incur interest charges by borrowing money.
Solar Leases in Pennsylvania
Leasing solar panel systems is ideal for folks who lack the necessary funds or equity to obtain a loan. Since many lease agreements require no money down, you risk nothing while reaping the rewards of solar savings. For example, electricity costs in Pennsylvania run above the national average. A 5-KW solar system costs approximately $713 dollars a year but will save you $819 dollars a year in electricity costs. While the savings may seem minimal now, they will grow annually as utility companies continue to raise their rates.
Here is how a lease works. When you enter into a lease agreement, you agree to allow the solar panel company to install and maintain solar panels on your rooftop. You make monthly payments to them but receive all the power they produce. You must also make payments to your utility company for energy you consume during times when the solar panels fall short such as on cloudy days or at night, when they produce zero electricity. When you combine the lease payment with your lower energy bill, you will realize a savings versus your old utility bill. This is a pretty good deal considering you put nothing down and carry no monetary risk or maintenance obligations.
Power-purchase agreements are very similar to solar leases. You provide the rooftop and the solar panel company installs and maintains the system. Whereas with a lease you make a set monthly payment for the equipment, with a PPA you pay for only the electricity you use, at lower rates than the utility company, which saves you money.
While both PPA’s and solar leases will save you money with zero out-of-pocket expense, there is one area where they fall short versus owning the system outright. Folks who own their solar system outright are entitled to any credits and performance payments versus a lease or PPA where the solar company reaps the benefits of any federal tax credits and excess solar energy your system contributes to the grid, which is sold back to the utility company.
Solar Net Metering in Pennsylvania
Net metering is an arrangement that allows you to sell excess electricity produced by your solar panels back to the utility company. Since 2008, Pennsylvania law requires investor-owned utilities to offer this program to residential customers at the full retail rate. The rates vary by state with Pennsylvania’s being one of the more generous programs in the country. When your solar panels produce more energy than you consume each month, the surplus is carried over to your next bill. Customers who run a surplus for an entire year can expect a check equal to the retail electricity costs minus the distribution component charges of your electric bill.
Solar Policies in Pennsylvania
Solar policies vary significantly by state and can affect your ability to go solar in both positive and negative ways. Below you will discover where Pennsylvania ranks compared to the rest of the nation as well as its position regarding other areas such as tax credits, property tax exemptions, and interconnection policies.
- Pennsylvania’s RPS “Renewable Portfolio Standard” ranking is 19th in the nation. The RPS law represents the amount of energy generation required from renewable sources by state. Federal standards are in place requiring utility companies to generate or purchase set amounts of renewable energy or face steep fines and/or fees.
- Pennsylvania’s RPS carve-out ranking is 13th in the nation. The RPS carve-out represents the amount of solar power electric utilities must produce to avoid stiff fines or penalties for non-compliance.
- High electricity prices — Pennsylvania ranks 12th in the nation — makes solar power an attractive option. The power the panels produce is cheaper than the electricity produced by the big utility companies. As the costs of utility power rise, you can save even more money in the future by generating your own.
- Pennsylvania’s interconnection polices are consumer friendly allowing solar owners to easily plug into the grid. Simple, straightforward policies in Pennsylvania reduce the red tape residents in less favorable states must address. Pennsylvania residents can find a complete breakdown for their state’s interconnection polices by visiting the Database of State Incentives for Renewables & Efficiency website.
- Pennsylvania’s HPB “High Performance Building Program” offers financial assistance to state residents and business owners by providing grants and low interest loans for high performance building design, construction, and renovation including solar power.
- Currently, the state of Pennsylvania does not offer solar tax credits, tax incentives, or tax exemptions for going solar.
- The Federal Government allows a tax credit of 30-percent for qualified solar expenditures and renewable energies for a system that serves said taxpayer through the Residential Renewable Energy Tax Credit.
Permit Requirements in Pennsylvania
Although Pennsylvania is solar power friendly, it does require residents and business owners to follow certain rules and regulations when installing a solar panel system. The Municipal Guidebook for Solar Zoning and Permitting is an online publication filled with important zoning and permitting information required by the state of Pennsylvania. It is important to note that zoning, permitting, and solar policy will vary by city and it is recommended that you contact the building department in your city before starting a solar panel project.
Where to Purchase Solar Panel Systems in Pennsylvania
Choosing the right contractor to install your solar panel system is an important first step. Their experience and know how will guide you through the entire process. A solar contractor will size your home, identify areas where it might fall short regarding energy efficiency, and recommend a suitable system. It isimportant when hiring a contractor to first verify they hold the appropriate licenses, certifications and insurance coverage required by your state and municipality. The Pennsylvania Office of Attorney General website provides an abundance of useful home improvement information including a searchable state contractor registry. You can also contact the Better Business Bureau for registered or outstanding complaints against solar companies and contractors.
Energy Audits Pay Off Before Going Solar
Maximize your solar benefits by scheduling an energy audit with your local power company. Many utilities offer this service for free to help consumers conserve energy, which lessens the demand for power and load on their systems. Common areas that may fall short in your home’s energy efficiency are leaking supply ducts, drafty windows or doors, and inadequate attic insulation. Improving your home’s energy efficiency will work hand in hand with your solar system by reducing your energy costs, which saves you money.