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Are Solar Panels Worth It in 2021?

08/15/2021

The solar industry has experienced rapid growth in recent years. In 2009, less than 20GW of solar capacity was installed worldwide. In 2021, that number has skyrocketed above 480GW—a rate of 24x growth in just over a decade.

That growth has been made possible by rapid technological advancements. In the same timeframe, the cost of a fully -installed system dropped from $7.14/watt in 2010 down to around $2.50/watt in 2021. That means you can go solar today for about one-third of what it would have cost ten years ago.

With the rapid growth in solar technology and the decrease in pricing, is solar still worth it for the typical homeowner in 2021? That’s the question we’ll set out to answer in this article. (Here’s a quick summary, though: if you own your home and connect to the grid, the answer is most likely “yes.”)

Comparing the Costs of Solar

If solar is getting cheaper, and the technology is improving all the time, does that make it a better investment than other options? To answer that, it’s not enough to compare the cost of solar against historical benchmarks. We have to look at how solar stacks up against alternative methods of delivering power to your home, because solar panels are really only worth the investment if it can outperform the other options on the market.

For grid-tied systems, the math is pretty simple: you compare the cost of solar against the cost of buying power from the utility company to estimate the grid-tied payback period.

These calculations can also be applied to evaluate off-grid systems. instead of utility power, though, you’ll need to compare solar to the costs of running a power line to your property (if possible) or look at alternative power sources, like wind, hydro, or a trusty generator. Sometimes a combination of methods (like solar + a backup generator) may be the smartest option.

How Solar Pays For Itself

Grid-tied homeowners buy electricity from the local utility company at a set rate. The national average in the US is around 13 cents/kWh.

When you go solar and connect to the grid, that bill is reduced (or completely eliminated) because you are generating your own power instead of buying it from the utility.

To figure out whether solar panels are worth the investment, simply compare the lifetime cost of utility power against the lifetime cost of going solar.

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