Solar Panels for Home – Still Worth it 2 Years Later?

This episode is brought to you by Squarespace. It's been two years since I installed solar
panels on my home in the Boston area. How's it been going? Let's take a look at how much it cost, how
much it's saved, how it's been holding up and what type of maintenance it's taken. I'm Matt Ferrell … welcome to Undecided. You might not think that Boston would do well
for solar production, especially since we're better known for our Nor'easters than sunshine,
but you'd be surprised. I started looking into getting solar panels
years before I actually got them installed on my home. They were still far too expensive and not
efficient enough to make them worthwhile for my house when I started looking. But thankfully the prices kept dropping and
the efficiencies kept getting better. I've run through a lot of the details on my
system in my previous videos about this, but here's what's installed on my house.

I've got 26 LG 365 watt panels that come with
a 25 year warranty, which guarantees at least 88.4% of it's original power output. They're hooked up to 26 Enphase IQ6 Plus micro
inverters and are monitored by the Enphase Enlighten system. The total cost of the 9.49kW system, before
state and Federal incentives, was $29,609. When I got it installed the 30% Federal Tax
Incentive was still active, so I ended up getting an $8,882 credit applied to my taxes
the year we had this done. There's actually a lot of misunderstanding
about how the federal tax credit works. It's not a rebate check that you get cut from
some kind of fund, it's a credit that you can use to reduce your tax burden in a given
year. And if you aren't able to apply the full amount
in one year, you can roll a portion of it over into a second year. Because most of us have our taxes automatically
withheld from our paychecks that means you'll have overpaid your taxes by tax time and will
get a nice refund check for the difference … but it all depends on how much you paid
in taxes.

The current program is winding down now and
is currently at a 26% credit. In 2021 it goes down to 22% and in 2022 it
will disappear for homeowners completely, but for commercial installations it will remain
at 10% forever. In the end the system cost us $20,727 out
of pocket, or about $2.18 per watt for the installation. As I explored in a recent video, Tesla's current
per-watt pricing is much lower than that now in the US, which is about $1.49 per Watt. We're still lagging behind other areas of
the world for our per-watt pricing, like Australia and Europe, but that's where we're at right
now.

This isn't a small chunk of change I spent
on the system, so why even do it? Well, my goals were pretty simple. I wanted to reduce my dependence on the grid
as much as possible, try to get as much of my energy coming from renewable sources as
possible, and to do so in a way that would be financially responsible. Energy independence, or as much as I could
get, was very enticing. If you're goal is make a buck and that's all
you care about, this isn't going to be what you want to do … and that's something I've
heard a lot in the comments on my previous videos. But the people that wrote that I should have
just invested this money clearly didn't listen to the goals I had for my system.

So how's it been performing? How much energy has it actually made and saved? Before I get to that, I’d like thank today’s
sponsor, Squarespace. I’ve been using Squarespace for years and
use it for the Undecided website. I’ve got over 25 years experience building
out websites, so I know it’s a full time job to build and maintain one. Squarespace takes care of all of it and lets
you focus on the other work that matters for your business. I absolutely love the content management system
for publishing my articles and videos. You can customize and fine-tune the look and
feel to get something that fits your personality and company’s brand. And you don’t have to worry about software
updates, web servers, or anything like that. The all-in-one platform is my favorite part.

If you want to build out a beautiful web presence
without the hassle, head over to Squarespace.com for a free trial and when you’re ready to
launch, go to squarespace.com/mattferrell to save 10% off your first purchase of a website
or domain. Thanks to Squarespace and to all of you for
supporting the channel. The system got turned on at the beginning
of October in 2018, which was a little anticlimactic because winter is the lowest production time
of year. That meant a monthly savings of about $25-50
a month, or about 100 – 200 kWh produced per month. Nothing to write home about, but when you
look at my system over the course of a year timescale, it's hit exactly where my solar
installer predicted.

The pattern you'll most likely see on most
systems will look like a sine wave over the course of the year. For me my peak happens between June and July,
and the lowest point is December and January. Over the course of the year that's worked
out to 6,665 kWh for year 1 and 7,193 kWh for year 2. Both years are above the guaranteed amount
my installer predicted. My house is a less than ideal setup with my
small roof sloped east and west.

Having a southwestern facing roof in the northern
hemisphere is far better to capture as much of the sun's path as possible. For me I opted to put panels on both sides
to capture as much of the morning and afternoon sun as possible. On top of that my neighbors have some very
tall trees on the western side that cause shading in the late afternoon, so my production
slopes off pretty quickly by about 4:00pm. I'm not sure my neighbors would like it if
I went and cut down their trees … not that I've dreamt about that. Like I said, less than ideal, but even with
living in the northeast of the US and contending with a very small roof facing the wrong direction,
and shade, I'm covering about 60% of my energy use through my solar production.

I have friends in my area that are able to
cover nearly 100% of their yearly energy use, which is why I always tell people that the
only person that can determine if solar is right for you … is you. So how did I figure that out myself and how
does it look in practice? Well, you need to look at your energy use
per year, how much you pay per kWh, and then compare that against how much a solar panel
system is estimated to produce for your home and for what cost.

It gets a bit more complicated when you layer
in different net metering systems, time of use rates, different incentive programs, loans,
etc. What I did was to figure out our average monthly
energy use costs and then start getting quotes and recommendations for different solar panel
systems. I ended up using EnergySage to get quotes
for myself. If you’re interested in going solar, I strongly
recommend checking out EnergySage for research and articles. It’s a completely free service that has
great write-ups and reviews of different solar panels, inverters, and solar tech that can
be useful no matter where you live.

Full disclosure, I am one of their partners
… I jumped into their partner program after my great experience using them. If you live in the U.S. and are interested
in going solar, you can get quotes from installers by using [my EnergySage portal](http://bit.ly/undecidedsolar). You can plug in your information and request
quotes from solar installers, which all get funneled into your EnergySage account, where
you can review them, rather than flooding you directly with phone calls or spam. It makes it easy to compare installers, cost
estimates and energy production quotes in one place …

It's a nice apples-to-apples
comparison between installers. But even without EnergySage, if you want to
break down things in an apples-to-apples way, be sure to calculate the cost per Watt of
each quote you get. Just take the total out of pocket cost (I'd
recommend the cost after incentives) and divide that by the watt system size. So if you’re having a 5KW system installed
for $7,500 after incentives, then your per Watt installation price is $1.50.

That's how I ended up with the $2.18 per Watt
pricing for my system in 2018 after subtracting the tax credit. The installer I ended up with not only gave
me a very accurate estimate of yearly production, but also guaranteed the production for the
first 10 years and offered a 20 year workmanship warranty. Where I live we pay between $0.22 – $0.24
per kWh and don't have time of use rates available to us, but we do have full net metering. So every kWh of overproduction that we feed
into the grid is credited a full kWh off our bill. Not all states or utilities do it this way,
so you may only get partial credit … unfortunately. Some areas will only credit the production
kWh cost and not the delivery cost. You'll need to find out what your area offers
as far as net metering and rates to calculate the final value of going solar. Since my net metering is 1:1, it makes the
grid act like a giant battery for us, dollar-wise. If you average out our monthly production
and dollar value over the year, it comes out to 556 kWh produced per month. Our average electric bill went from $212.40
per month to $90.23 per month after solar.

That's a 58% savings. We also are participating in a solar renewable
energy credit program (SREC). Here in Massachusetts it's now known as the
SMART program, but my rates were locked in under the previous system for 10 years. We get $126.22 per month for the energy we're
producing, which works out to $15,146.40 over the course of the program. When you combine our electricity savings with
the SRECs, we're saving a total of $248.66 a month for the first 10 years of the system. After that it drops down to just the energy
savings value. We got a solar loan to pay for the system,
so we also need to factor in the interest costs to our final tally. After the tax credit, our total system cost
us $20,727, but at the rate we've been paying off the loan the final cost including interest
will be around $23,250 …

But might be a bit lower. It depends on how quickly we pay it off in
the remaining months. But, that means the system will have paid
for itself by 2026 or 7 years after installation, which falls right in line with our projections
before installation. If we didn't have the SREC $126 monthly credit
and only had the energy savings, it would pay itself off by 2034 … 15 years after
installation. The interest we paid on the loan added about
2 years to our payback time. Clearly, this is a long-term decision we made,
and all the numbers I cited for myself will vary depending on your home's specific situation. I have friends in my area that had a payback
period in under 4 years. My brother-in-law just had solar installed
on his home in Texas and it's incredible the amount of energy his system is producing. He's most likely going to cover 100% of his
energy needs throughout the year, so he'll never have an electric bill again. But Texas also has cheap electricity already
and no real solar incentives, so his payback time may not be that different from what mine
would be without SRECs.

You have to evaluate solar for your specific
goals and situation. But what about maintenance? This is another question I've heard a lot
… like a lot a lot. There are only a few things that I've had
to do for my solar panels over the past couple of years. Within the first 6 months we had two short
periods where our panels stopped working for a few days.

It turned out to be a faulty emergency shut
off switch for the system, so the installer swapped that part out and it's been humming
along ever since. This cost us nothing to fix. It's one of the reasons our first year of
production was slightly lower than our second year. The two other things I've done are, first,
sweeping snow off the panels after heavy snow storms in the winter, which isn't really necessary. Snow tends to melt more quickly on the panels
than it does on the rest of the roof. It's funny to see it in my neighborhood because
every house with solar is usually clear of snow within a day or two of a heavy storm,
while everyone else has snow on their roof for weeks.

But if it's anything over a few inches, I
try to clear it off with a foam roof rake to give me panels a little extra help. And to also help control the avalanche of
snow that happens when it slides off on its own. It's kind of funny … and a little scary. Like I said, not necessary, but if you want
to maximize your production it's not too hard to do.

And then, second, using the same roof rake,
but with a cleaning attachment, I've washed off the panels in the summer a couple of times. Again, in my area it's not super necessary
since we get a fair amount of rain that washes off the dirt, but during dry periods you can
sometimes see the pollen and dirt build up. I haven't noticed a dramatic difference in
production, but it can cause lower production if you let them get too dirty. Overall, I've had zero maintenance costs in
the first two years and expect that to continue. Both the inverters and panels have 25 year
manufacturer warranties, and my installers workmanship warranty has me covered for 20
years. Based on that, plus everyone I know personally
that's had solar for years, this trend is going to continue for quite a while. The only upcoming cost, that I've accounted
for but haven't really discussed on previous videos, is putting on a new roof.

My roof still had a good amount of life left
when we installed the panels, but I'm expecting to have to replace all, or a portion of the
tiles, in 10-15 years. For that you typically would hire a solar
installer to remove, store, and then reinstall the panels when the roof work was done. The cost can vary wildly, but according to
EnergySage it can range between $1,500 – $6,000 depending on the size of the system and whether
or not the mounting hardware has to be removed.

From the people I've talked to in my area,
I'd expect it to be somewhere around $3,000 for me, which means losing about 1 two 2 years
worth of the solar panel yearly savings. In the grand scheme of things, that's a drop
in the bucket for the total savings of the system over 30 years … which should be over
$30,000. And before anyone asks about battery storage,
I didn't have batteries installed as part of the system originally.

It didn't make sense financially with the
cost and the fact I had full net metering. But since then I earned a founders edition
Tesla Powerwall from the Tesla referral program. I've been waiting for it to get installed
and will be publishing a full video on that experience and what I think of the system
later, so be sure to subscribe and hit the notification bell to not miss that. And I recently just published a video about
home batteries in general; costs, benefits, and different incentive programs that are
popping up. Depending on where you live, the math for
battery storage is starting to make a lot more sense, so be sure to check out that one,
too. Jump into the comments and let me know if
you have any questions, and if you have solar panels, how have they been working out for
you? Share your experiences, it can be really helpful
for others looking into it.

And as always a special thank you to all of
my Patrons. All of your support is really helping to make
these videos possible … and a big welcome to knew Supporter + members Ed and Suzanne
Amos, and new Producer James Aspinwall. As always, thanks so much for watching, I’ll
see you in the next one..

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