Is Installing Solar Panels Worth It?

Is Installing Solar Panels Worth It?

solar panel

Have you ever wanted to reduce your carbon footprint and leave a better world for your children?  If so, then solar panels may be a worthwhile investment to help the planet as well as your pocketbook.

Pollution is a major issue throughout the world.  Factories in many countries spew out toxic gases and fill the air with plumes of smoke.  Often, these smoke filled clouds have traces of mercury and other toxic pollutants wreaking havoc on the planet.  Many birth defects and diseases are caused by these pollutants.  Often times, factories burn fuels such as coal and natural gas to get power.  Power plants also burn these fossil fuels to generate electricity for households to use.  By installing solar panels on your home, you can help reduce the reliance of fossil fuels.  In addition, solar panels generate their own power that can be put back on the grid, allowing you to earn credits and reduce your energy bills.  After accounting for subsidies and savings, the average time to recoup savings can range from 15-17 years.  The solar panels last up to 25 years meaning that you may be able to make a profit after installation!

However, installing solar panels is only worth it as long the subsidies last.  The subsidies are expected to expire at the end of 2016.  Let’s do a quick calculation to try and guess the time to recoup savings.  As a conservative estimate, suppose that after subsidies solar panels cost $14000.  If we get savings of $100 per month then within about 12 years we will cover the initial cost.  On the other hand, suppose no subsidies are available.  Our panels would end up costing about 18200 and our recoup time increases to 182 months or 15 years.  Since the average life of solar panels is 25 years, there are 10 more years left where saving will accumulate.  As the savings per month go down, expect longer for recoup time.  To break even over 25 years, you must average $61 per month without government incentives.  In terms of savings, government incentives help a great deal and will allow you to earn a profit on your initial investment.  Even if subsidies are unavailable, costs of solar panels are expected to go lower.

Even though solar panels may not save you money over the long run, solar panels are worth it in terms of helping the environment.  Most of the energy produced by power plants come from fossil fuels such as natural gas and coal.  These produce greenhouse gas emissions which has been known to contribute to global warming.  Using solar panels could reduce fossil fuel demand and foster a more sustainable life for people.  Even though fossil fuels are cheaper, there are many hidden costs that are not taken into account.  Drilling for natural gas and coal damages the environment and leads to health issues for people working in these areas.

Overall, solar panels could be a worthwhile investment if you take advantage of subsidies offered by the government.  In addition to potentially saving money on your energy bills, you will be helping the environment and reducing dependence on fossil fuels.