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Solar power was the largest source of new power generation capacity for the first time in 2016, according to the Solar Energy Industries Association. Not only that, but the industry is also expected to triple in the next five years. Solar energy has also become cheaper. Costs for solar PV systems in the US decreased nearly 20 percent in 2016.

But even though it’s getting cheaper, that doesn’t mean that everyone can afford it. However, it is possible to use low-cost solar energy if you are on a budget. Solar energy can help you save money in the long run, as well as helping the environment. These tips will help you cope with the transition.

Is solar energy right for you?

Since solar panels depend on the sun to generate electricity, the amount of sun you live in will affect the amount of solar energy you can produce. The amount of solar energy available in an area is known as a “solar resource,” which is a measure of the amount of sunlight available each day to a photovoltaic panel facing south. The amount of solar energy you can produce from roofing panels also varies from home to home. If there are large trees or other buildings that block access to sunlight, it will not be able to receive as much sunlight.

Some other factors that will influence the amount of sun you can receive are the orientation and size of your roof. South-facing roofs work best and you will need at least about 100 square feet per kilowatt-hour that your solar system produces. You will also need to consider the amount of energy you normally use and the efficiency of the panels you will install, which typically ranges from 11 to 15 percent.

The less sunlight you have available, the larger your solar array will have to be to generate the same amount of power as panels with more sun available. This can lead to higher costs.

You can use online cost calculators to help you determine how much a solar system would cost you, or better yet, have a reputable solar company come in and give you an estimate.

Solar incentives

An important factor in the affordability of solar energy is the incentives available to you. There are federal incentives, but other programs vary by state and utility company.

US residents can take advantage of the Solar Investment Tax Credit, which provides a 30 percent federal tax credit for homeowners who purchase and install solar systems in their homes.

To find out what incentives are available in your state, visit the Renewable Energy & Efficiency State Incentives Database. The site presents information on available government and utility incentives and policies related to solar power by the state.

Different states have different policies to incentivize and bill homeowners who generate solar power. These policies can have a significant impact on the profitability of a solar system installation.

One common policy is called net metering, which only charges or pays homeowners for their net energy use. If they produce more than they use, the excess energy returns to the grid, and the owner will be compensated for it. If they consume more than they produce, they are charged only for the energy they used from the grid.

Other states use a feed rate program, which measures production and consumption separately. The owner is then paid for what he produces and is charged for what he uses. The payment can sometimes be used to cancel the electricity bill. How net metering, feed rates, and other programs work can vary from state to state, so be sure to do your research to determine how much a solar system will cost you or how much money you could make from it.

Financing options

States, utilities, and other entities often offer financing options to help make a solar installation more affordable. Power purchase agreements and solar leases are two other financing options. With PPAs, a low-cost solar company installs a solar system on your property at no cost. They then sell you the electricity you produce, often at a cheaper price than the electricity from the utility. At the end of the contract, the owner can choose to extend it or possibly buy the system.

Solar leases are similar to leases used in other industries. The owner has the system installed on his property and does not pay any or part of the cost upfront. They then pay for the system over many years and can eventually buy it outright.

Other financing options include loans, energy-efficient mortgages, and community solar energy, in which a community or third party owns a solar system and nearby homeowners can pay to receive power from it. There are even charities that will install solar panels for low-income homes for free or almost free.

Although solar power can have some high start-up costs, there are many ways to lower those costs. Thoroughly research what options are available in your area and take advantage of them, so you can harness the sun’s energy to power your home, lower your electricity bill, and help the environment.

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