Many people are concerned about the current state of the world, and the rising cost of living. They are looking for the best investments to make their money. Is solar energy an investment worth it? What are the inflation trends in your country? What is the direction of interest rates? Although no one can make the right financial decision for your family, data shows that now is the best time of year to invest in solar power.
This post will give you a quick overview of the current solar energy landscape, its future and the reasons why switching to solar this year is a smart decision.
Despite overall inflation rates stabilizing, energy prices are on the rise.While inflation costs are stabilizing and prices in many other areas such as food and gas are still high, one industry continues to rise: electricity. Over the past 10 years , electricity prices have increased by 34%.
The transition to solar energy provides a hedge against rising costs and gives you more energy independence from market volatility.
Nationally, solar panel demand is increasing
The demand for solar panels is increasing. What does this mean to consumers? The industry is growing, which means there will be a greater demand for the materials and people needed to install solar panels. In the future, this could mean that residential solar customers will have to wait longer for their products. This could lead to more shortages like the temporary one the industry is experiencing now.
The growth in solar industry demand is positive. There could be some personnel delays as the industry adjusts to the growing demand. Solar is becoming mainstream and it’s a great reason to get solar installed soon.
The industry is dominated by residential solar, but the utility solar boom will soon take over more resources.
The chart shows the predicted boom in utility solar in the next years. You might consider making the switch to solar sooner rather than later if you are a homeowner.
Currently, 31% of solar PV demand is for residential projects. However, residential will drop to 16% by 2027, with utility solar growing quickly at 180%. As the industry develops and demands continue to rise, more large-scale projects will be prioritized. In the future, this could mean that there will be longer wait times for residential projects and fewer panels going towards them. The times are changing and so will the solar landscape. This is something homeowners should take into consideration when planning to go solar.
Solar panels are becoming more affordable.
The prices for solar panels have dropped substantially in recent years making it more affordable and accessible to homeowners.
There are many financing options available that can be tailored to meet your financial goals. There are many financing options available for homeowners, whether they want $0 down, low monthly payment or 0% interest rates. You could see an immediate return on your monthly out-of-pocket electricity costs depending on how your system generates energy and the policies of your local net meters (see point below). An Freedom Solar energy consultant can help you create a custom solution.
Your home’s value will increase if you switch to solar energy
Homeowners will experience an increase in their home’s value , with a higher return on investment (ROI), than other home improvements. According to Zillow solar panels can increase the home’s selling price by 4.1%. The average Austin home sells for $599k. This means that the average homeowner will see a return of $24.5k on their home by simply upgrading to solar.
Solar panels look better from an aesthetic standpoint. The days of clunky, outdated panel technology are gone. SunPower solar panel offers a modern design with a low profile mounting system. This is for homeowners who desire a more elegant look and the most efficient on the market.
Living in suburbs, wealthy family. Great new home in countryside, wood material, green color
While federal and local tax incentives favor residential sun power right now, they are on the decline.
There are currently many federal tax incentives and local that can help you subsidize your home-solar project. These will offset the cost of purchasing your system and installing it. Many local electric companies are reducing incentives for residential solar, including declining tax credits and net metering being less exchanged at the same rates it used to.
Take CoServ Electric based in Dallas, Texas. The company recently reduced residential solar’s financial incentive by offering a lower fuel rate in exchange for energy being returned to the grid. This is a nationwide trend. Residential solar users should contact their local utility to find out their current net-metering policy.
It is a great reason to go solar right now, as you can get grandfathered into a utility’s net-metering policy before any policy changes.
To offset and subsidize the cost of switching to solar energy, the federal government offers a 30% federal credit to qualified individuals. The Inflation Reduction Act has been extended through 2032. However, it will drop to 26% by 2033. This encourages homeowners to use the credit as soon as possible.
When the market is volatile, it is safe to invest in a physical asset such as a solar panel system.
A physical asset is more risky than other types of investments when the economy is in turmoil. There is very little risk in buying a physical asset if you balance risk and reward. SunPower solar panels come with a 25-year warranty. This means that your asset is protected from any unexpected circumstances. If the economy is in turmoil, you might be unable to decide where your money will go when you most need it.
Investors who are tired of seeing their earnings fluctuate in the equity markets will find that solar offers a steady return that is only as volatile and stable as the number of sunny days per year. It also doesn’t add to economic uncertainty and stress.
Solar protects against extreme weather and can save you money.
Extreme weather events can lead to higher energy prices. Weather-related events can cause energy prices to rise (think about a polar vortex, which causes people to simultaneously turn up the heat at their homes). Solar won’t only protect against rolling blackouts when the grid cannot handle demand but also ensure that you are not subject to demand-surge pricing.
The volatility in weather patterns is on the rise. Consider Texas’ historic Winter Storm of February 2021, which knocked out most power supply in the state. In recent years, Florida has experienced an increase in destructive hurricanes.
The traditional grid is less safe with solar power. A fully solar-powered community was the only Florida community to keep its lights on during Hurricane Ian. During a severe winter storm, 3,700 Texans could keep their lights on thanks to Powerwalls. Unprecedented events can be more secure with the help of backup power and solar energy. SunPower solar panels have been proven to withstand extreme hail, extreme temperatures, and hurricane-force winds. This gives you added security if your area experiences frequent severe weather.
Solar panels reduce your carbon footprint and can be a smart investment that will last for many generations.
It is obvious that alternative energy investments have significant consequences for your carbon footprint. Solar produces electricity without releasing methane or carbon dioxide into the atmosphere.
The atmospheric carbon dioxide is absorbed into the atmosphere and remains for decades while radiating heat towards the earth, which warms the planet. The atmosphere is flooded with methane from burning petroleum and natural gas.
No methane is required for solar energy source transmission or use. The more solar energy you use, the less you need to use natural gas or petroleum and the less methane you produce. It is a small step in helping the earth.
By reducing your energy consumption, you can make a difference in the world for your children and future generations by switching to renewable energy.
Experts predict a global energy crisis within the next decade. Solar will provide a hedge at the household level.
A collective investment in solar energy is essential to avoid an energy crisis. Take in Europe, for instance . Experts predict an energy shortage in Winter 2023-2024 . With no access to Russian gas imports, costs will become prohibitive.
As energy trade becomes more globalized, there are also shortages around the globe. The US was the largest LNG exporter in the world, thanks to the increased demand from Ukraine. This has led to rising power and gas prices.
An international energy crisis caused by macro events could lead to higher electricity prices in future. This is a stark reminder of the need to diversify our energy sources at a national level and invest more in renewable energy. Solar investment is a way to protect yourself from an energy crisis.