We try to keep consumers informed about trends and changes in the solar energy industry. But solar markets vary so much by state, and sometimes even city, that the information can be vast. In this series of case studies, we will explore what solar energy looks like in specific areas.
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Now, let's talk about solar energy in the state of Florida.
The case of Florida solar panels It's called the Sunshine State for a reason: solar energy is abundant here! We recently applauded Florida for its decision to allow solar leases. This new financial option makes now a great time to add rooftop solar panels to your home. A lease typically allows homeowners to add rooftop solar panels with no upfront costs, making it a possibility for many more people. Leases also allow customers to accurately plan their energy costs. Leasing customers pay a fixed monthly amount based on their system's projected power production. Plus, leasing customers won't have monthly bill fluctuations.
Florida generates most of its energy from natural gas and coal. Both are relatively inexpensive but contribute greatly to pollution and global warming. And even though Florida electricity rates are below the national average, 2 residents can still save money by using solar power. You don't have to choose between the environment and your pocketbook.
Net performance and measurement payments in the Sunshine State
Florida has a strong net metering program, which is great if you are looking to go solar. It allows you to offset all or most of your electricity costs with solar panels. Any excess energy your rooftop solar panels produce is fed back into the grid, and most Florida utilities pay their customers the full retail rate for that energy. Those credits roll over 12 months, so when you need to draw power from the grid (at night, for example), the credits offset any new charges.
As a bonus, the Orlando Public Utilities Commission will pay its customers $ .05 for each kilowatt-hour produced by its customers' systems. That includes the energy they use.3 That is added to the net retail rate metering. Easy money!
Solar Installation Rebates and Incentives for Floridians
Florida residents who install rooftop solar panels are eligible for the federal Renewable Energy Tax Credit. It is equal to 30 percent of the cost of a solar photovoltaic system (for systems in service at the end of 2019 with the credit decreasing until 2021). That is a considerable saving! Some solar energy providers will claim the credit. This will save you paperwork on both the application and IRS forms and pass the savings on to you. Others will leave it for you to claim.
Solar rooftop systems are exempt from Florida sales tax, 4 which can save you hundreds of dollars upfront. Additionally, the state offers a property tax exemption on the value the system adds to your home, so you won't have to worry about increased taxes.
Outside of the city of Longwood, Florida does not offer statewide solar rebates. While potential solar customers likely want the state to do more to encourage solar development, Florida's strong net metering policy does a lot to save solar customers money, even without the additional state bonuses.
Return on your investment in Florida solar panels
Let's cut to the chase. How much can you save with cheap solar Florida energy in the sunshine state? Of course, how much you save will depend on the size of your solar system and your electricity use. For example, the value of the energy produced by a 5kW solar power system in Tampa would be about $ 79 per month. With the 11-year payback period, a customer could save around $ 8,500 in 20 years. Keep in mind that your system should last more than 20 years.
The extra money in your wallet is a great reason to go solar, but don't forget to factor in the environmental benefits as well. You cannot put a price on knowing that your energy comes from clean, renewable energy and that you are doing your part to clean the air in your city. It is a win-win.
Loans and leases
The above calculations and projections are based on owning your solar system, but you have other options in Florida as well. We'll take a look at each one.
1. Buy solar: this is the simplest. You buy your solar system in advance, plain and simple.
2. Solar loan: Similar to a solar power purchase, but you finance your system with a loan. If you use a loan to purchase your system, the savings you see will vary somewhat depending on the terms of your particular loan. Some large solar installers offer solar loans. Other providers will refer you to an outside financial institution for a loan. Some homeowners choose to obtain a home equity loan to finance their panels. Exploring more than one loan option can help you get the best rate for your system.
3. Solar Lease: You lease the panels while your solar provider maintains the property. You will not own your panels and you will not be able to claim the federal income tax credit. However, the savings must still be passed on to you. Your solar energy provider can claim these incentives and include them in your monthly payment.
Leasing customers are typically not required to make a down payment, so the savings may be easier to compare than with a solar purchase. Just take the monthly payment specified in your solar offer and compare it to your average monthly electricity bill. Keep in mind that you will likely still have to pay a small monthly fee to your utility for connection to the grid, and at times you may have to purchase power from them.
Get the numbers for your home
The final word is this: Florida is the state of white sand beaches, Publix submarines, and rooftop solar power. This post should give you an idea of how much you can save with solar energy. But the only way to know your specific savings potential is to get a solar offer tailored to your home and electricity use. Let us give you one for free! Get started with your quote.