Going Green and Saving Green with Solar Panels

Keeping your house warm in the winter or cool in the summer can get costly during more severe seasons of weather extremes.

While paying our utility bills may seem unavoidable, what if we could cut costs by harnessing the energy of the sun?

WHAT IS SOLAR ENERGY? Solar panels capture the sun’s energy and convert it into electricity. The sun’s photons travel 93 million miles in 8.5 minutes to the Earth. The sun’s photons hitting the earth in one hour are capable of satisfying the entire planet’s energy needs for one year.

Photovoltaic energy, however, covers only 0.5% of the United States’ total energy needs. Tapping into the sun’s energy for electricity is becoming increasingly popular for its cost savings and lack of environmental impact.

Solar panels collect the sun’s photons, which are converted to energy by breaking loose electrons from atoms. Conductors in panels are attached to the positive and negative sides of silicon cells, which creates a circuit, like a battery. As electrons flow through the circuits, electricity is generated.

Solar panels, or modules, are comprised of multiple cells. A group of modules wired together is called an array.

The direct current (DC) electricity from solar panels is generated as electrons move in one direction around a circuit. Alternative current (AC) electricity is generated when electrons move back and forth. Utility providers use the less-expensive AC electricity for its ability to transmit long distances.

Inverters are used to convert DC electricity into AC electricity for home use. The use and invention of microinverters has revolutionized the solar industry, allowing for the optimization of the individual modules and preventing the system from shutting down if one module malfunctions.

When you’re not at home or when the sun’s not shining, the excess energy the panels generate is fed back into a grid system in a process called net metering, which measures and records the energy surplus. Homeowners earn credit for the additional electricity generated and can use it later. (1)

DOES SOLAR SAVE MONEY? Going solar not only generates electricity, but big savings as well. Some analysts say that homeowners in many states reap monthly savings to their utility bills of more than $100. Over 20 years, that savings can rise to $30,000. In sunny Hawaii, homeowners have saved on average $64,000.

Many homeowners are signing up for solar purchase power agreements and solar leasing. This enables them to put nothing or very little down to get started. Another popular approach is 

a pay-as-you-go option. Additionally, a big benefit of solar units is increased property values. Homes with solar panels sell 20% faster and buyers are usually willing to pay 17% more. (2)

SAVING WITH SOLAR TAXES The federal solar tax credit also provides homeowners with a matching tax deduction that equals 30% of the total cost of the system. With an $18,300 average system cost in 2019, the tax credit can reduce the total federal tax cost by $5,490. While utility providers may increase electricity costs, solar energy expenses are stable. Many manufacturers also provide a 25-year warranty, which means your bill won’t change. (3, 4)

Besides the cost savings, the most obvious benefit is to the environment. The U.S. ranks second in the world in total carbon dioxide emissions from fuel combustions behind China. Going solar is going green in so many ways. You save money, you help save the environment, and you become less dependent on your utility provider. (5)

1: https://us.sunpower.com/blog/2017/10/25/how-does-solar-energy-work

2: https://energyinformative.org/benefits-of-solar-panels/

3: https://news.energysage.com/how-do-i-claim-the-solar-tax-credit/

4: https://energyinformative.org/benefits-of-solar-panels/

5: https://www.ucsusa.org/global-warming/science-and-impacts/ science/each-countrys-share-of-co2.html

 

 

 

IMPORTANT INFORMATION: Craig Price, CFP, CTFA, is an Investment Advisor Representative associated with Naples Wealth Planning, LLC (NWP), an investment adviser registered with the U.S. Securities and Exchange Commission (SEC). The content is the opinion of Craig Price, and may not necessarily agree with the investment adviser Naples Wealth Planning.
This material is provided for informational purposes only. Information is not intended to be and should not be construed as an offer, solicitation or recommendation with respect to any transaction and should not be treated as legal advice, investment advice or tax advice and no investor should rely upon or make any investment decisions based solely upon contents of this material. Current or prospective clients should under no circumstances rely upon this information as a substitute for obtaining specific legal or tax advice from their own professional legal or tax advisors. Please keep in mind investing involves varying degrees of risk, and there can be no assurance that future performance of any specific investment or investment strategy will be profitable and you may gain or lose money. Past performance is not indicative of future results.
Capital Rock Financial, LLC d/b/a Naples Wealth Planning (“NWP”) only transacts business in states where it is properly registered or in compliance with applicable state regulations. NWP is a registered investment adviser with the U.S. Securities and Exchange Commission (“SEC”). NWP’s services should be considered in connection with its written disclosure brochure (i.e., Form ADV Part 2A), a copy of which is available for free by calling (239) 260-9386 or Email info@napleswealthplanning.com

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