NBC 10 I-Team: Solar panels not beneficial for every household - WJAR

NBC 10 I-Team: Solar panels not beneficial for every household | WJAR

Solar panels are supposed to reduce your electric bill and save you some cash, but that's not the case for everyone.

Solar panel systems have grown in popularity since the Inflation Reduction Act passed in 2022, offering homeowners a federal tax credit for solar installation.

While that tax break can drop the price by 30%, Consumer Reports Senior Editor Tobie Stanger says investing in the panels still isn't worth it for every household.

“It depends on your electric bills and how long you expect to stay in your home,” Stanger said. “You have to figure out what the break even point is for purchasing solar because it’s expensive.”

On average, solar panel systems cost over $20,000.

While the federal tax credit can drop the price tag, it’s not a guarantee.

Rhode Island Attorney General Peter Neronha’s office recently filed a lawsuit against Smart Green Solar, accusing the company’s door-to-door sales personnel of misleading consumers over the tax credit by guaranteeing they would receive it.

According to that complaint, some consumers only qualified for a portion of the credit or did not qualify at all, which is why doing your homework is so important.

Smart Green Solar has denied the allegations.

“The tax credit doesn’t help people who don’t owe money to the federal government typically, or they don’t owe a lot to the federal government,” Stanger said.

DETERMINE YOUR SAVINGS

If you’re interested in solar panels, Stanger says your first step should be to determine your savings.

Websites like Project Sunroof, EnergySage, and SolarReviews have solar calculators that can help you figure out if you’ll break even in 20 years.

You start by determining your average monthly bill, then inputting that information into one of their calculators. The websites incorporate views of your roof from places like Google Earth to establish your savings.

We found estimates can vary, so it's not foolproof.

Stanger says another factor to consider is the cost of removing and reinstalling solar panels. “A typical roof warranty is 25 years and the solar panel warranties are typically about 20 years, so it depends on where they overlap,” she said.

Consumers have recently reported estimates of up to $8,000 to remove and reinstall solar panels for roof repairs.

You can avoid the issue by hiring a reputable roofer to inspect your roof before signing a contract and visiting your city or town hall to determine its age.

“The solar companies also will do this for free, they will check your roof, but if you want someone independent to do it it’s worth paying a few hundred dollars to get that done because boy, that’s a big deal if you have to replace your roof after the solar panels go up,” Stanger said.

Asphalt shingles that are 10 years or older should be replaced before solar panels are installed.

LEASING SOLAR PANELS

If it doesn’t make sense to purchase a solar array, another option is to lease one.

It requires no money down and instantly lowers your energy bill, but it also has some downfalls.

“The problem is you don’t get to take advantage of certain tax benefits that are available if you buy the solar system and you don’t own the solar system when you lease,” Stanger said.

Not owning the system could become an issue if you’re not in your forever home.

“When you go to sell that could be a problem because the new buyer may not want to take on that system and then you must have a leasing company come take it off,” Stanger said.

Interest rates can also be higher and monthly payments may change each year, potentially becoming more expensive.

“Leasing has its issues,” Stanger said. “It’s usually not as cost-effective as purchasing out right.”

Another piece of advice before investing in solar, remember not to rely on the opinions of door-to-door salespeople as they’re trying to make a transaction and are mainly commission based.

Finding out whether solar panels are worth it ultimately comes down to doing your own independent research.

“You have to look at your budget, you have to look at your annual budget and decide if it will work for you, if the payments from a loan or a lease will work for you,” Stanger said.