How Solar Financing Works & Saves You Money
You often hear about the great financial benefits of going solar, but may
still be asking yourself, "can I afford to go solar" or "what's
the payback period for solar?" Let's take a moment to go over
the basic financials of solar, including
$0-down financing options (yes, you don't have to spend money to save money)!
It doesn't take an economics degree to understand that electric costs continue to increase; PNM & other utilities in New Mexico have raised electricity rates by around 50% over a 10 year period (or an average of 5% per year). When you purchase your energy from the utility, you are stuck paying whatever they want to charge now, and into the future; there is no end-game as you'll continue to pay them forever.
Solar financing allows you all the benefits of owning a solar system (you get the tax credits, monthly savings and stable energy costs, increased home value, etc.) without the downfalls of leasing (lien on the property, annual price escalator, transfer of ownership issues). When you've paid off your solar loan, you'll continue to produce free, clean, energy!
How Much Money Solar Panels Can Save You - The Math:
Let's assume you're currently paying $100/month in electricity.
You can go solar with no money down and trade your $100 electricity bill for an $82 monthly loan towards your system. You'll receive an $8/month connection charge from the utility in order to utilize the net-metering benefits of the grid (this prevents you from needing to spend extra money on batteries for evening use, and is a good thing). As you can see, this would mean you SAVE $112 in the first year simply by switching. As utility rates continue to increase every year, your rate remains the same, saving you more and more money.
So the answer to "what's the payback period for solar" is IMMEDIATELY because it is not costing anything additional, rather it's a trade. If you prefer to pay cash for your solar system (many of our customers do this as well), you'll get an even greater return on investment (because you won't have any interest), but the payback period calculation becomes a little more complex and really requires an in-depth consultation to discover.
The higher your electric bill is now, the more you stand to save with solar.
In New Mexico, the largest utility company, PNM, charges a tiered rate structure for electricity that increases in cost at each tier (seen below)
In other words, the more electricity you use, the more expensive it is
to use the same electricity. Even if you're home or business does
not switch to 100% solar offset, simply preventing you from reaching the
higher-cost tiers can save you significantly!
If you're wondering whether you're a good candidate for solar...
Ask yourself these questions:
- Do I own my property?
- Does my electricity bill average $80/month or more?
- Do I have a credit score of 720+ (if planning to finance and get the best rate)
- Do I have a roof or ground area that is relatively shade-free?
- Am I interested in being a part of the solution to climate change?
If you answered YES to these questions, solar is a great solution for you. Don't wait any longer, and start saving today!