top of page

Understanding Proposals for Home Solar

Ahhh….it’s almost springtime. The weather is getting warmer, the trees are starting to bud, and people are starting to think about their next home improvement project. And along with the warming weather, the solar salespeople are starting to swarm on unsuspecting homeowners like locusts from the plagues of Egypt.

You may be interested in home solar. But solar products, systems and terminology are confusing. As you do your research you’ll be inundated with TLAs (three letter acronyms)…and the more installers you talk to, the more you’ll get confused. On this week’s Energy Show we’ll review a Four Step Process that you can use to compare different home solar proposals.

Step One: Compare Installers. Consider local installers, check references from friends and neighbors, and read online reviews. You will almost always get better service and faster installation turn around with a local company. When hiring someone to work on my house, for accountability purposes I always prefer contractors that have their own trained crews (not subcontractors or temporary works).

Step Two: Determine the Cash Price of the Installed System on a Per Watt Basis. Just as buying a car, you always want to shop for the best cash price — keeping financing out of the picture. Get a quote for the total installed system (no deductions yet for incentives or tax credits). Then determine the total number of DC watts of the system (number of panels times watts per panel). Divide the watts into the dollars to get a $/watt price for your system. Pricing can range from the low $3/watt to over $5/watt. For example, a system priced at $20,000 for 20 panels, each with a rating of 270 watts, will cost $3.70/watt. Don’t get distracted with varying claims about equipment reliability, inverter efficiency or panel degradation — they are all about the same. Regardless of manufacturer or installer, every system will put out about the same amount of energy (and annual dollar savings) if it has the same DC watt system size.

Step Three: Compare Equipment and Services. Solar panels are commodities, but you will pay more for higher efficiency and more well known brand names. All panels have 25 year warranties, and will operate maintenance-free (except for an occasional cleaning if they get very dirty). The only time you need higher efficiency is when you have limited roof space. Nevertheless, you may prefer solar panels that look all black and are mounted flush to the roof, or micro-inverters and optimizers that have built-in safety features, or a system that has monitoring that you can view on your cell phone.

Step Four: Compare Financing. There are so many assumptions involved in financing, system output, energy rates and output “guarantees” that it is almost impossible to compare the total savings numbers. That is why it is easiest to compare cash prices or, if you are considering a loan, comparing interest rates. Watch out for escalation rates applied to energy prices (escalation rates will inflate your savings) and monthly payments (escalation rates will increase your repayment costs).

Home solar has never been more cost effective and reliable as it is now. Favorable tax policies, local incentives and net metering combine to make solar a great long term investment. So if you’re considering rooftop solar, Listen Up to this week’s Energy Show.


bottom of page