Filed under: Guest Posts.
If you have seriously considered outfitting your house with a solar power system, you’ll be glad to know that the payback time frame is getting shorter. SBI Energy, a global energy research firm, released a report in October of 2011 showing that newly installed solar energy systems pay for themselves in as little as three years.
Of course, there are some variables here, such as where you live and the size of the system installed. You may remember, as I do, that just a few years ago payback was often calculated at something like 10-20 years for an average residential solar installation. Less than six months ago, my research was showing the length of time necessary for a home solar power system to pay for itself was closer to 10 years, on average, even with government incentives and other rebates. Taking that fact into consideration, three to five years is a very long stride in the right direction.
Despite some bumps in the road, the solar industry is actually performing quite well. The report expects solar installations to increase each year until 2020, when the estimated global GW value will be 400, or 10 times the number recorded for 2010. A temporary drop in European solar markets will be more than made up for by Asia and North America, despite the predicted expiration of some federal incentives in the United States by the end of 2011.
The return on investment in solar, as compared to other types of renewable energy, will also be aided by the drop in price per watt from the current $3 to $1 by 2020. Obviously, a smaller initial investment will pay for itself more quickly, possibly offsetting any reduced rebates and incentives for homeowners installing residential solar power systems.
In addition, lower energy costs and the widespread requirement that utilities pay for excess energy produced by household systems will immediately help defray costs incurred by the photovoltaic system, and feed in tariffs will substantially increase the price per watt homeowners receive from their utility. Since many parts of the U.S. have seen house values increase when solar power is added to the home improvement profile, resulting in a “solar premium” when the house is sold, it seems possible that solar energy systems may wind up paying for themselves not once, but several times over.