Benefits of Solar Energy
Solar energy offers several advantages that will enhance your home for years to come.
- Reduced carbon footprint: Solar is a highly abundant clean energy source, meaning you can lower or beat your home's dependence on non-renewable sources.
- Lower energy bills: Sourcing some or all of your own power will spend less on electricity long-term. Plus, some states provide net metering programs that make it possible for you to sell your unused energy back to the grid, generating extra credits toward your energy bill.
- Better energy independence: Solar energy can keep your home running through blackouts and emergencies. You can use your solar energy anytime with an optional battery backup system.
What Solar Incentives Are Available to San Luis Obispo Homeowners?
California homeowners who upgrade to solar could qualify for special financing, reimbursements, tax credits and rebates. Here are just a few of the area's incentive programs.
Incentive Type: Property Tax Incentive
Website: boe.ca.govIncentive Amount:
100% of system value; 75% of system value exemption for dual-use equipment
Incentive Type: PACE Financing
Incentive Amount:
Locally determined
Incentive Type: Rebate Program
Website: selfgenca.comIncentive Amount:
For projects 30 kW or larger, 50% of incentive will be received up-front; 50% will be received based on actual kWh production over the first 5 years. For projects under 30kW, 100% of the incentive will be paid up front.
Incentives will step down over time. See below for incentive amounts.
Incentive Type: Feed-in Tariff
Website: cpuc.ca.govIncentive Type: Feed-in Tariff
Website: ladwp.comIncentive Amount:
$0.17/kWh adjusted by a time of delivery multiplier
Base price will step down over time as certain MW goals are met
Incentive Type: Rebate Program
Website: gosolarcalifornia.ca.govIncentive Amount:
Step 1 Incentive Rates (contact utility to determine current incentive levels):
Single Family Residential Incentives:
Systems that displace natural gas: $29.85 per estimated therm displaced
Systems that displace electricity or propane: Funding has been exhausted
Commercial/Multifamily Incentives:
Systems that displace natural gas: $20.19 per estimated therm displaced
Systems that displace electricity or propane: $0.42 per estimated kWh displaced *** Note, funding has been exhausted in this category for SCE and PG&E
Solar Pool heating: $5.00 per estimated therm displaced
Incentive Type: Personal Tax Credit
Website: ecowatch.comIncentive Amount:
30% federal tax credit for systems placed in service after 12/31/2021 and before 01/01/2033. Good for: solar water heat, solar photovoltaics, biomass, geothermal heat pumps, wind (small), fuel cells using renewable fuels.
How To Choose the Best Solar Company in San Luis Obispo
The purchase price and performance of solar panels often depend on which company installed them. Consider each of these elements in your business search.
Licensing and Training
California requires solar companies to hold licenses for each type of equipment they install, which can include solar pool heaters, water heaters, boilers, HVAC, and photovoltaic (PV) systems. Contractors must take a highly comprehensive educational series, gain four years of experience as an apprentice or journeyman, and pass written exams to secure a license. You should also visit a company's website to learn about its private certifications. Two of the most respected are the Solar Heating Installer and PV Installation Professional certificates, granted by the North American Board of Certified Energy Practitioners (NABCEP). Some companies don't publish this information online, so you should also ask your estimator about them.
Cost of Solar Panels in San Luis Obispo
The type of solar panels you select determines how much electricity you can produce. Monocrystalline panels and high-quality and cost more but give you the best performance. Polycrystalline panels produce less power, but they're worth it if you want a traditional panel style without the high cost. Thin-film panels aren't recommended for large residential installations, but they are ideal for small projects like converting RVs and sheds.
You can also add electric vehicle (EV) chargers and battery backup systems. These will increase your total installation cost, but they can maximize your solar system's efficiency. Not every solar contractor includes these optional components, so look for a contractor that sells them if it's crucial for you.
You can expect to pay about $17,350 on average for a five-kilowatt solar energy system in San Luis Obispo. Check the table in this section to get an idea of how much San Luis Obispo solar companies might quote for your specific solar system's price.
| Solar Panel Cost | Average Cost |
|---|---|
| Solar Monocrystalline | $1,211 |
| Solar Polycrystalline | $944 |
| Thin-Film | $552 |
| Solar Battery | $775 |
| Solar Home EV Charger | $2,906 |
Financing Solar Energy in San Luis Obispo
Solar installers offer multiple different financing options to increase your savings and lower your costs. Though some providers offer unique payment plans, the most common are solar loans, cash payments, power purchase agreements (PPAs) and solar leases. Most solar experts recommend a cash payment or using a solar loan. Cash payments require a large up-front sum, but they save you from paying interest, grant you system ownership, and qualify you for cost-saving solar incentives. Solar loans have the same benefits, though you'll pay more in total due to interest and fees. Like a home or auto loan, you'll pay a set monthly rate with potentially $0 down. Solar leases involve paying a set monthly rate to use rooftop panels. A PPA (Power Purchase Agreement) allows you to pay a monthly rate based only on the energy you use, akin to an electric bill. We typically don’t recommend these two options because you won't own the system and cannot use solar incentives. Look for providers that offer several payment plans to find the right fit for your financial needs.
The table below lists the average payback periods for different capacities of solar systems in San Luis Obispo.
You are eligible for a 26% federal solar tax credit for new solar energy equipment until the year 2032. City and state officials and utility companies might also offer discounts, rebates, and specialized financing options that could save you more.
| Solar System Capacity | Estimated Payback period |
|---|---|
| 1 kW | 1.4 years |
| 2 kW | 2.7 years |
| 5 kW | 6.8 years |
| 10 kW | 13.7 years |
Ready to Get a Quote on Your Solar Project?
Please enter a valid 5-digit zip code!
Frequently Asked Questions About Solar in San Luis Obispo
How much energy and money could I save per year by switching to solar?
How prevalent is solar energy in San Luis Obispo?
Will solar energy systems increase my San Luis Obispo home value?
How many years will a standard solar system last?
Is solar installation a fast job?
What maintenance do my solar panels need, and how often do they need it?
How can I maximize my solar panels' performance?
- optimize the panels' position with your solar installer
- regularly clean your solar panels
- upgrade to a more efficient inverter trim or cut down trees in the way of your panels
- use energy-efficient appliances
What's the difference between a PPA and traditional financing?
You might think about a PPA if you don’t want to be responsible for maintenance and don’t want to invest in a system, but keep in mind you won’t be paying toward ownership or be able to access any solar financial incentives. Many solar experts don’t recommend PPAs. Our guide covers other financing options above.
To share feedback or ask a question about this article, send a note to our Reviews Team at reviewsteam@thisoldhousereviews.com.
