Solar power is booming. Over the past decade, solar energy capacity in the U.S. has grown by an average of 25% each year, hitting a new high in 2024, according to the Solar Energy Industries Association.
Most residential solar systems are designed to supplement your home’s energy needs. This approach reduces your reliance on traditional energy sources while maintaining a reliable power supply.
In this guide, we’ll walk through how to determine if your home is a good candidate for solar power and the benefits and drawbacks of installing a solar power system.
Assessing Your Home’s Solar Potential
Also known as photovoltaic (PV) systems, solar panels absorb sunlight and convert energy from the sun into electricity you can use in your home. This can be stored in a battery or converted into AC power that is distributed throughout your home’s electrical system, which can lower your electric bill. Solar energy can also benefit the environment.
Before investing in a solar system, evaluate your home’s suitability for solar power. Solar panels installed in an unsuitable location, like a completely shaded roof, may not generate enough electricity to be worth the cost. Assess solar panel suitability by considering your roof, location, and climate.
What Makes a Roof Solar-Ready: On a TOH project, the solar team explained the three key criteria for evaluating your roof: First, it should face south—ideally within 15 degrees of solar south. Second, the roof pitch should be between 30 and 45 degrees, which also helps shed snow in winter climates. And third, check for obstructions—trees and nearby structures that cast shadows can significantly reduce panel output. As one installer put it on the project, “Shade is not good for solar.”
Evaluate Your Roof for Solar Panel Potential
Your roof plays a vital role in determining your home’s solar potential. Consider these factors:
- Orientation: Areas with more sunny days will generate more solar power. South-facing roofs are ideal for maximum sun exposure in the Northern Hemisphere.
- Slope: A roof angle equal to the latitude of your home is ideal – usually between 30 and 40 degrees.
- Shading: Obstructions like trees or nearby buildings could cast shadows on your panels and diminish their performance.
- Age and condition: Ensure your roof is in good condition before installing solar panels. If it’s not, make repairs before installing solar panels.
Pro Tip: According to TOH Magazine’s guide to prepping your house for solar, the ideal candidate for solar installation has a roof less than 10 years old. If you’re already planning to reroof, that’s actually the perfect time to go solar—you can have a structural engineer verify the roof offers enough support, inspect rafters for damage, and even run rigid metal conduit from the attic to the basement near the electrical service panel during renovation, which avoids the installer having to run conduit visibly down the outside of your house later.
A professional solar installer can help you determine whether your home is a good candidate for solar panels.
Home Solar System Cost
The upfront costs and performance of a solar system can vary widely depending on factors such as state. system size, equipment quality, and installation complexity. On average, homeowners can expect to spend between $2.50 and $3.50 per watt for solar panel installation, according to Angi. The average home needs about 6,000 watts, which would put the average total price between $15,000 and $21,000. But with all the other permits and connections added in, Angi lists the average total price at about $27,000.
Pro Tip: Kevin Price, solar energy expert featured on This Old House’s Arlington project, explains why costs have dropped so dramatically: “It is now cheaper to make electricity from the sun than the utility can make from the big power plant.” He attributes this to three factors: the free cost of fuel from the sun, government incentives, and the fact that equipment costs have dropped dramatically — and he expects that gap to keep widening as panels get cheaper and grid electricity gets more expensive.
Factors affecting solar system costs include:
- System size and power output
- Type and quality of solar panels and inverters
- Roof condition and installation complexity
- Local labor and permit costs
Payback Period: According to TOH’s Reno Planner, in most of the United States it can take 9 to 12 years for your energy savings to pay back the cost of a solar system (5 to 15 years when you include outlier states). After that, your solar should provide free power for as long as two decades more. The payback period depends on your latitude, the direction your roof faces, the amount of tree cover, the cost of electricity in your area, and your utility’s policies. For an instant estimate, plug your address and average monthly electricity cost into Google’s Project Sunroof tool.
Ongoing Costs and Savings
While the initial investment may seem high, solar panels can provide long-term savings through reduced energy bills. These savings typically take 10 to 20 years to eclipse the total upfront costs. How quickly you recuperate your investment depends on your home’s energy consumption, local electricity rates, and system performance.
To calculate potential savings:
- Estimate your current annual electricity costs
- Determine how much of your electricity needs the solar system will cover
- Factor in any increases in electricity rates over time
- Consider the lifespan of the solar system (typically 25-30 years)
Pro Tip: As solar installer Kevin Price explained on a TOH project visit, homeowners “can get electricity from the system for about 10 cents a kilowatt hour, whereas their neighbors will pay about 12 cents a kilowatt hour from the utility.” He attributed that edge to three factors: “The free cost of fuel from the sun, the incentives that we get from the government, and then the fact that equipment has dropped so dramatically.” And the trend favors solar owners over time—cheaper panels paired with rising grid electricity prices mean savings will only grow.
Incentives and Tax Credits
Various incentives can help offset the cost of solar installation:
- Federal Investment Tax Credit (ITC): Currently allows you to deduct 30% of the cost of installing a solar energy system from your federal taxes.
- State and local incentives: Many states offer additional tax credits, rebates, or performance-based incentives.
- Solar Renewable Energy Credits (SRECs): Some states allow you to earn SRECs based on the amount of solar energy your house uses. These can be sold to utility companies in some states, which are required to purchase a certain amount of these credits.
Important: For tax credits, you have to fund the project up front, but you’ll receive some or all of that money back via a discount on the amount of taxes owed at the end of the year. If you don’t owe any tax in the year that you spend the money, some credits can be carried forward. Many solar companies will also provide a no-interest loan against your tax credit until the following tax season, according to TOH Magazine.
To find current incentives in your area, visit the Database of State Incentives for Renewables & Efficiency (DSIRE).
Grid-Tied vs. Off-Grid Solar Systems
Most residential solar systems are designed to work in conjunction with the existing power grid. Grid-tied systems allow you to draw power from the grid when your solar panels aren’t producing enough electricity. If your solar panels produce more energy than your home requires, you may even be able to sell excess energy back to the grid. These systems are more common and typically less expensive than off-grid systems.
Pro Tip: Richard Trethewey, TOH’s plumbing and heating expert, explains the grid-tied advantage this way: “A regular solar system would either be going right now to the house or back to the grid.” For homeowners concerned about high electricity rates during peak demand, battery storage adds another layer of value. As installer Jared explained to Richard, time-of-use rates can “pretty much double” in the late afternoons — and a smart battery system knows when the grid is charging too much, automatically switching to stored power instead.
Off-grid systems operate independently of the utility grid and require battery storage to provide power when solar production is low. These systems are more complex and expensive but offer more energy independence.
Net Metering
Net metering is a billing arrangement that allows solar system owners to receive credit for excess electricity they generate and feed back into the grid. Here’s how it works:
- Your solar panels produce electricity during the day
- Excess energy is sent to the grid, spinning your meter backward
- You receive credit for this excess energy on your utility bill
- At night or on cloudy days, you draw power from the grid as needed
Net metering policies vary by state and utility company, so check with your local providers for specific details.
Home Solar Panel Maintenance
While solar panels provide renewable energy and require minimal upkeep, regular checks and cleaning will help optimize performance. Routine maintenance includes:
- Clean panels: Gently wash panels with water and a soft brush to remove dirt and debris.
- Reduce shade: Trim trees or remove obstacles that may be shading your panels.
- Monitor system performance: Regularly review your system’s output to detect any issues.
- Inspect wiring and connections: Look for signs of wear or damage.
When to Call a Professional
While most maintenance tasks can be performed by homeowners, some situations require professional assistance:
- Significant drops in energy production
- Visible damage to panels or equipment
- Issues with the inverter or electrical connections
- Annual professional inspections to ensure optimal performance
Pros and Cons of Solar Energy
While installing solar panels brings a host of benefits, it’s not right for every home. Make sure to pay attention to the drawbacks as well before making a final decision.
Benefits of Solar Energy
- Lower utility bills: By generating your own electricity, you can significantly reduce your monthly energy costs.
- Environmental impact: Solar energy is clean and renewable, helping to reduce greenhouse gas emissions.
- Energy independence: Solar panels can provide power during outages, improving your home’s resilience.
- Increased home value: Solar installations can boost your property’s resale value.
- Tax incentives: Many states and the federal government offer tax credits and rebates for solar installations.
Pro Tip: Los Gatos, CA, solar installer and energy podcaster Barry Cinnamon advises homeowners to think ahead before sizing their system: “Panel designs change about as quickly as flat-screen TVs,” says Cinnamon. If you’re planning to add an EV or central air in the near future, size your solar array for those future needs upfront—expanding an existing system later can be costly and problematic, often requiring a new inverter and mismatched panels.
Potential Drawbacks of Solar Power
- Initial costs: The upfront investment for solar panel installation can be significant.
- Weather dependent: Solar panels produce less energy on cloudy days and no energy at night.
- Space requirements: You need adequate roof space or land area for panel installation.
- Maintenance: While minimal, solar systems do require upkeep.
Alternative Energy Sources Beyond Solar
While solar power is a popular choice, other alternative energy sources can also help reduce your home’s carbon footprint and energy costs.
Geothermal Energy Systems
Geothermal systems harness the earth’s constant temperature to heat and cool your home. These systems work by circulating a fluid through underground pipes, which absorb or release heat depending on the season. Geothermal energy is highly efficient and can provide significant energy savings over time.
Geothermal works well in various climates and isn’t affected by outdoor temperatures. However, it does have high installation costs, and the initial investment can be substantial due to the need for ground excavation.
Wind Power for Residential Use
Residential wind turbines can generate electricity for homes in windy areas. While less common than solar panels, wind power can be an effective alternative energy source for some homeowners.
Wind power requires significant space. For optimal performance, you’ll need at least an acre of unobstructed land. It is also dependent on local wind speeds, which need to be at least 8 mph.
Our Conclusion
Solar power and other alternative energy sources offer exciting opportunities for homeowners to reduce their carbon footprint and energy costs. By understanding the benefits, costs, and considerations associated with these technologies, you can decide the best energy solution for your home.
Remember that improving your home’s overall energy efficiency is an important first step before investing in alternative energy systems. By combining energy-efficient practices with renewable energy sources, you can create a more sustainable and cost-effective home energy solution that benefits your wallet and the environment.
