Solar Panels for Home Energy: Pros & Cons

According to the Solar Energy Industries Association (SEIA), solar power is energy from the sun that is converted into thermal or electrical energy. It’s the cleanest and most abundant energy resource our planet has to offer.

The average solar panel is about 3x5 feet; they’ll work no matter the direction they face, and you’ll likely need 15 to 18 panels for a home roughly 1500 square feet. But how they actually work is the interesting part: the sun shines onto them, and photons from the sunlight are absorbed by the cells in the panel. According to the Department of Energy, this process creates an electric field across the layers and causes electricity to flow. And while solar panels do need direct sunlight, they work on cloudy days, too.

Some environmental and economic benefits to using renewable energy include:

• A diversified energy supply and a reduced dependence on imported fuels

• New economic development that increases jobs in engineering, manufacturing, and installation

• Energy that doesn’t produce greenhouse gas emissions from fossil fuel

It makes sense that increasing our use of renewable energy would allow us to significantly reduce US global warming emissions. By reducing the amount of carbon and pollutants in the environment, it translates to less pollution, cleaner air, and cleaner water. And when it comes to improving our planet, it’s a good option.

Possibly, solar panels can save you money, but the extent of those savings depends on several factors, such as your location, electricity usage, the size of your solar panel system, and local incentives or rebates.

• Energy Savings: Solar panels can significantly reduce or even eliminate your electricity bill, especially if you generate enough power to cover your home’s needs. In some cases, you may also be able to sell excess power back to the grid, offsetting costs.

• Upfront Costs vs. Long-Term Savings: While solar systems do require an initial investment, many homeowners find that the savings on energy bills over time can more than make up for the upfront cost. In some cases, solar panel systems pay for themselves within 5-10 years and can continue to save money for 20-30 years or more.

• Incentives and Tax Credits: Federal, state, and local incentives, such as the Federal Solar Investment Tax Credit (ITC), can help reduce the upfront cost of installation, making solar a more affordable option. Additionally, some utilities offer rebates or incentives for installing solar panels.

• Increased Home Value: Homes with solar panels often see an increase in property value, meaning you may be able to sell your home for more if you decide to move.

Ultimately, solar panels are a great way to reduce energy costs, especially over the long term. A consultation with a solar provider can help you understand the specific savings potential for your home based on your energy usage and location.

When trying to determine how much energy a solar panel produces, we first need to understand kilowatt hours. Solar panel systems are measured in terms of kilowatts (the amount of electricity you use at a specific time). According to Energy Sage, most solar panels available in 2022 will usually produce between 250 and 400 Watts of power. The actual output will depend on factors like shading, orientation, and sun hours.

No, one reason why people think solar energy is bad is partly due to the panels' inability to work at night. But just because your solar panels don’t produce energy at night doesn’t mean there aren’t other ways to harness solar power. With buyback programs through retail electricity providers, you can get money back from sending your unused electricity during the day to get energy credits at night. However, it’s important to realize there are some programs that are uncapped, but more that are capped. In the cases where you have a capped buyback program, you may not end up getting anything for some amount of your unused electricity.

A solar loan, much like a regular loan, is money you get from a lender to help you finance your solar panels. Some solar system retailers will offer you a secured loan upon purchase—and while these have a lower interest rate, they do require you to give collateral. If you prefer an unsecured personal loan, you can expect higher interest rates, but at least your panels won’t be repossessed if you default on the loan. Another option would be applying for a home equity loan, which also comes with lower interest rates, but your home is on the line should you be unable to pay.

No matter which route you go, remember that taking out loans will reduce the financial advantages of your solar panel system and may negate why you wanted to go solar in the first place. Check out this solar loan calculator to see if this financing option works for you.

A financing option where a third-party company installs, owns, and maintains the solar system on your property while you pay a fixed monthly fee to use the solar energy it generates.

A power purchase agreement is relatively similar to a solar lease. A third-party company will install and maintain your solar panels, but instead of paying a rental fee, you pay for the actual electricity produced by the panels. It’s kind of like having your own personal power plant at home—and the costs come out similar to those of a lease.

Third-party ownership (TPO) in solar power refers to a situation where someone other than the homeowner or property owner (usually a solar company or investor) owns and maintains the solar system installed on your property. Instead of purchasing the system outright, you enter into an agreement with a third party to either lease the system or purchase the energy it generates through a Power Purchase Agreement (PPA).

To determine which options are available to you, check out this solar loan financing article by NerdWallet.com.

A solar buyback plan allows you to sell excess energy generated by your solar panel system back to the grid, often through net metering. The utility company compensates you with credits or payments for the surplus electricity you don’t use. While not always required, a buyback plan can be beneficial as it helps offset your electric bill, provides financial returns, and contributes to renewable energy efforts. To take advantage, check with your utility company about available programs, rates, and whether you need a special meter to track both consumption and export.

Net metering is an electricity billing system that helps you offset your solar panels’ non-working hours of the night by selling back excess electricity generated during the day. Texas does not currently have a statewide net metering policy. This means you can't net your Transmission/Distribution Service Provider (TDSP) charges against what you produced and sent back, meaning you pay for all demand charges you consume without the ability to offset. Buybacks rely on a meter being able to read both consumption and surplus. So currently at night in Texas, most solar homeowners still have to pay for electricity load charges.

According to Consumer Affairs, the starting cost to install a 6-kW solar system is over $21,000 in Texas. That means the average cost per watt is $2.10. Whether you’ll need a bigger or smaller system depends on the size of your home and the amount of energy you (and your household) typically consume per month. You can check old electricity bills to get an idea of how many panels you’ll need to power your home. Obviously, how much it costs to install solar panels is a big payment upfront, but the payout over time can be a strong advantage when thinking about solar options.

Trying to figure out how many panels to install is easiest if you know your annual energy usage. For reference, the U.S. Energy Information Administration (EIA) shows the average Texas household uses about 14,000 kWh of electricity per year—but you can check your own by looking at your bill. Next, you need to know the wattage of the panels you’re wanting to install (you can expect most solar panels to offer 300 watts of power). Multiply your energy usage by the number of sunlit hours your home gets, then divide that number by the wattage of the panels you want. Or skip the math and try this solar panel calculator from Project Sunroof.

For more information, check out the chart in the “How Many Solar Panels Do I Need to Power My Home?” section above.

Yes! ERCOT’s fuel generation is seeing more and more renewables, with wind and solar combining to approach close to 40% of generation capacity in Summer 2022. How does that get to you? REPs are still responsible for buying renewable energy credits (RECs) to ensure everyone enrolled in a renewable energy plan gets the electricity they need. So, whether you’re interested in solar, wind, hydropower, geothermal, or biomass electricity, REPs will make sure you get what you need.

Interested in going green without solar panels? Energy Ogre connects you with 100% renewable energy plans that help save the planet—and keep your electricity bills low.

Texas sees an average of 234 sunny days in a year—so yes, solar energy seems like a viable option. The tough sell on going totally solar, however, is the cost. It is a major upfront investment, and it takes a while to pay off. In that time, technology could improve, and things could become more available and cheaper. So in the meantime, Energy Ogre meets our members with clean energy solutions that don’t require the same investment. With thousands of megawatts of solar electricity coming onto the grid in the next twelve months, the availability of 100% renewable energy plans will only increase. Make the switch to a renewable plan with Energy Ogre—you, your wallet, and the planet will thank you.

Because of how much solar energy costs, it’s worth looking into other renewable options. But if you're committed to harnessing the power of the sun, here’s a resource from the Database of State Incentives for Renewable Efficiency that breaks down clean energy programs by zip code. While there’s no one way to get free solar panels from the government, there is the federal solar tax credit program, which offers a 22% return on your solar installations. And if you’re paying upwards of $15k on the installation, you’d get a pretty penny back.

There are also REP solar buyback rates or regulated utility solar buyback rates (depending on where you live in the state).

In deregulated areas of Texas, you can pick an REP that offers solar buyback rates in the form of uncapped credit plans, credit cap plans, or real-time metering plans. It’s a great option if you consistently generate more solar energy than you’re able to use.

If you live in the regulated part of Texas, you’ll find that your utility provider either offers solar buyback plans or they don’t. Unfortunately, there isn’t much you can do if you have a bad plan, but it may influence whether you make the switch to solar energy in the first place.

Solar panels last up to 25-30 years.

Cleaning the panels to remove dirt, leaves, or snow that could obstruct sunlight should be the only ongoing maintenance.

Solar panels can be recycled at the end of their lifespan.

According to Solar.com, the best roof materials to support solar panel usage are composite shingles, tile, metal standing seam, tar and gravel, and wood.

No, you should install a solar panel system through a qualified professional who holds a certification to do so.

Factors such as roof obstructions (e.g., dormers, peaks, chimneys, HVAC vents), structural integrity, shading, orientation, and other variables can make solar unsuitable for your roof.

If your roof isn’t suitable, you might consider a ground-mounted system. These systems require a clear area, free from trees and other objects that could cast shadows. Typically, ground-mounted systems use aluminum and stainless steel racking and are secured with concrete.

If neither a rooftop nor ground-mounted system works for you, another option is to purchase solar energy from a community solar array. Explore community solar options in your area to see if this solution is available to you.

During a power outage, the reaction of your solar panel system depends on the type of setup you have.

For a grid-tied solar panel system without battery storage, your solar panels will continue to generate electricity when the sun is shining but won't supply power to your home.

If you have a grid-tied panel system with battery storage, the solar panels will continue generating power during the day, and any excess energy will charge the batteries. When the grid goes down, the battery provides backup power to your home, ensuring an uninterrupted supply.

For an off-grid solar panel system that is not connected to the grid at all, your home will remain powered during an outage, relying entirely on solar generation and battery storage.

Batteries store electricity generated by solar panels during the daytime, allowing you to use stored energy when the sun isn't shining.

Most home solar panel systems do not come with battery storage. The system will send excess energy back to the power grid.

Yes, you can add battery storage to your existing solar system later.

According to SolarReview.com, “You can expect to pay at least $12,000 to potentially upwards of $20,000 to install a single home battery.” Check out their article on solar battery storage for more information.

If you have an old or damaged roof, yes, you should have it repaired or replaced before getting a solar panel system installed.

Installing the solar panels themselves should only take a few days at most, depending on how many are being installed. However, it can take up to 60-90 days for the entire system to be connected and permitted before you can start using your solar panel system.

Yes, most home solar systems come with warranties that cover various components of the system, providing peace of mind for homeowners. The specific terms and coverage vary by manufacturer and installer.

While solar panels can absolutely increase your home sale value, it can also be a bump in the road. Depending on if you’ve bought the solar panels, financed them, or leased them, there are financial ramifications. Some buyers may not want a home with solar panels due to concerns about upkeep. Others may not want to take over a solar lease or pay off the rest. Texas Realtors lists off how solar panels could affect a transaction for your home.

Yes, you can generally transfer solar panels to a new owner when you sell your home, but the process can depend on the ownership structure of the system (whether you own the panels outright or are leasing them). Here's what you need to know for each scenario:

• If You Own the Solar Panels Outright

  If you own your solar system, transferring it to the new homeowner is relatively simple. Since the panels are part of your property, they stay with the house after the sale. However, there are a few things to consider:

  • System Documentation: Ensure the new owner receives all relevant documentation, including warranties, manuals, and maintenance records.

  • Energy Production Information: Provide the new homeowner with information about the system's energy production, maintenance schedule, and how to monitor its performance (if applicable).

  • Utility Connection: If there are any utility or net metering agreements tied to the solar system, you'll need to work with the utility company to transfer these accounts to the new homeowner.

• If You Have a Solar Lease or Power Purchase Agreement (PPA)

  If you have a solar lease or PPA (where a third-party company owns and operates the system), transferring the system can be more complicated.

  • Lease Transfer Process: Most solar leasing companies or PPA providers allow you to transfer the agreement to the new homeowner, but they may require the new owner to undergo a credit check or sign a new contract. The lease or PPA terms would likely remain the same unless renegotiated.

  • Contractual Obligations: If the new homeowner doesn’t want to assume the lease or PPA, you may need to buy out the remaining balance or come to another arrangement with the solar provider. Some leases may include a buyout option.

  • Notice to Solar Company: It's crucial to inform the leasing company or PPA provider of the sale and follow their procedure for transferring the agreement.

• If You Have a Solar Loan

  If you financed your solar system with a loan, the situation is similar to a lease or PPA:

  • Loan Transfer: Some solar loan providers allow the loan to be transferred to the new homeowner, but this is subject to approval. The new homeowner would need to qualify for the loan, similar to any home financing transfer.

  • Payoff Option: If the new homeowner doesn’t want to assume the loan, you might need to pay off the remaining balance at the time of sale.

General Tips for Transferring Solar Systems:

• Consult Your Installer: If you installed the system yourself or have an installer or provider, consult them to ensure the transfer is handled smoothly.

• Disclose the System in the Sale: Make sure the solar installation is disclosed to potential buyers as part of the home sale. Buyers may see it as a valuable feature, and transparency can help avoid misunderstandings.

• Check Local Laws: Some local jurisdictions may have additional rules or requirements for the transfer of solar systems.

Transferring solar panels to a new homeowner is definitely possible, especially if you own the system outright. If you're leasing or have a loan, you'll need to work with the leasing or loan company to ensure the transfer is smooth. As long as the transfer is managed properly, a solar system can be a selling point and even add value to your home.

In most cases, yes, you can install solar panels on your home if it is governed by an HOA, though you will likely have to submit a request. Many states and territories have enacted solar access laws, which prevent HOAs from prohibiting or unreasonably restricting solar installations. Solar access laws vary by state, so if you’re planning to install solar and have an HOA, it’s important to know the laws that apply to you. Learn more about HOAs and solar energy.

To get your solar system approved and permitted in Texas, start by selecting a licensed solar installer who will design your system based on your home’s energy needs and roof space. The installer will then conduct a site survey, provide a proposal, and obtain the necessary permits, including building and electrical permits. Once the permits are secured, the installer will submit an interconnection application to your utility company to connect the system to the grid. You may also need to sign a net metering agreement if you plan to sell excess power back to the grid. After the system is installed, local inspectors will verify that the installation meets safety codes. If all inspections pass, the utility company will provide final approval to connect your system to the grid. Your installer will then activate the system, and you can start using solar power. Most systems include monitoring tools to track performance. Keep all documentation, including warranties and permits, for future reference. Finally, Texas offers property tax exemptions for solar systems, but you can also take advantage of the federal solar tax credit for additional savings.

Yes, check out this article by GORVING.com for more information.

Installing solar panels can affect your homeowners insurance by increasing your coverage needs, as your policy will need to account for the added value of the system. You may see a slight increase in premiums, depending on the size and cost of the installation, but some insurers offer discounts for eco-friendly upgrades. It's important to inform your insurance provider about the installation, as failing to do so could leave you underinsured. You should also confirm that your policy covers risks like installation damage, removal, or repair costs. In some cases, insurers offer specialized policies for solar systems, which might be worth exploring. Overall, make sure your policy is updated to properly cover your solar panels.

To receive payment for the electricity your solar panels generate, you typically participate in programs like net metering or feed-in tariffs (FiTs). With net metering, excess power is sent to the grid, and you receive credits on your utility bill to offset the electricity you consume when your system isn’t generating enough power. Some areas offer FiTs, where you're paid a fixed rate for the power you send to the grid. Other options include Power Purchase Agreements (PPAs), where a third party buys your solar power, or solar leases, which may involve reduced bills instead of direct payments. To get started, contact your utility company to learn about available programs and make sure your system is set up with the necessary equipment to track energy production.

If your solar system consistently generates more power than you use, you can either build up credits for later use or receive periodic payments, depending on the program. However, be sure to check your TDSP’s policies, as some areas may limit how much energy can be exported, or they may offer a lower payment rate for surplus energy.

If your solar panels produce less energy than you need, the shortfall will be covered by grid power, and you'll pay your TDSP for the extra electricity consumed. How much you owe will depend on your local utility’s pricing and your net metering or billing setup.

A solar co-op is a group of property owners who collaborate to reduce the cost of solar panels and installation by purchasing in bulk. These co-ops are also referred to as "solarize" programs.