Because we have been stuck in our homes for months, many people are thinking about ways to use these spaces to generate income. This in part explains why rental accessory dwelling units (ADUs) have become such a hot topic.
However, another way to turn your home into a financial asset is by investing in rooftop solar panels!
For Bay Area homeowners, rooftop solar panels can be a smart way of lowering both your energy bills and your carbon footprint.
It’s true, however, that not all homes are equally well-suited to rooftop solar panels. And beyond that, there are a number of considerations to weigh first…
Here’s what you should know if you’re considering rooftop solar panels for your home:
Your Home’s Suitability
In general, California is a great state for rooftop solar! Still, a home’s suitability for solar panels depends on a number of factors; these include exact location, local weather patterns, roof slope and aspect, as well as any shading from nearby buildings or structures. A great resource to evaluate their potential effect at your address is Google’s Project Sunroof. This site estimates not only the financial and environmental efficiencies, but also provides more information on financing and selecting an installer. Also, if your roof is within 5-10 years of being replaced, it’s worth having it assessed before moving forward with a new system.
Types of Systems
There are two types of rooftop solar panel systems: stand-alone, which means that energy your roof generates can be used only within your home, and grid-connected, which allows you to sell excess energy back to the grid. The process of selling excess energy to the grid depends on a local policy called a “Feed-In Tariff”, so visit the California Public Utilities Commission website to learn more.
To encourage wider adoption, the federal government and certain states have established tax incentives for purchasing rooftop solar panels. You can read more about those programs for California taxpayers here. Above all, the federal solar tax credit (or ITC) will fall from 26% in 2020, to 21% next year, down to 10% from 2022 onwards. This means you should act quickly to secure the maximum write-off for your rooftop solar panels!
While rooftop solar systems are designed to pay for themselves over time, the up-front costs can be high. Fortunately, homeowners now have the ability to buy outright, secure a loan for, or even lease rooftop solar panels. Be sure to discuss financing options with your installer. And if you don’t know where to start, EnergySage is a great place to find cost-effective installers and loan providers near you.
If you’re curious to learn more about how solar energy works, check out the U.S. Department of Energy website.
And if you have any questions for us, get in touch via our contact page or through the form below: