They seemed so normal. You were unaware of any tree-hugging in their history. You’ve noticed solar going up around your neighborhood and had questions, but didn’t want to have to endure a “sales pitch” to get the answers to a few simple questions.
As the owner of a solar company, I’ll give you three reasons why your neighbor just installed solar on their home, all without the commitment to sit through that “sales pitch”.
1. Asset Vs. Rental
Why did you buy your home instead of continuing to rent? Because it’s the American Dream? Maybe a little. Because your 136 lbs. Bull Mastiff is no longer “welcome” in the home rental circles? Possibly. For most people, buying a home is the best way to get their hands on a very useful appreciating asset. You’re paying for an item that will have real value once paid off. Unlike a rental home which, even after years of paying a monthly fee for the right to use it, will hold zero value to you once you move out. The exact same reasoning can be found in solar.
Each month, your neighbor was paying Rocky Mountain Power “rent” to use their plant to produce enough electricity to run their household. Your neighbor receives no “shares” in Rocky Mountain Power stock each month, nor does he or she gain ANY long-term tangible benefit from that relationship.
Solar is different. Your neighbor took out a 20-year loan and used it to purchase an asset that now sits atop their roof. The principle owed on that asset is paid down every month instead of a Rocky Mountain rental bill. Those solar panels now produce as much energy as your neighbor was renting from Rocky Mountain Power each month. So instead of paying $120 to Rocky Mountain last month, your neighbor paid $120 towards the loan on the asset atop his roof, and $5 to Rocky Mountain Power (all customers are REQUIRED to pay Rocky Mountain Power a “connection” fee each month). Rocky Mountain power can’t help themselves…
Over time that asset on their home will be paid off and they will own it free-and-clear. It will increase the value of their home when they look to sell, and it will continue to produce free energy long after it’s paid off. Can you say the same for that boat sitting next to your home?
2. Federal and State Tax Credits
Your neighbor’s not a bum (unlike that fella around the corner). He and his wife both have jobs. They pay their fair share of taxes. And when your neighbor learned that he could receive 30% of the total price of his solar system back in Federal Tax Credits, as well as $1,600 back in Utah State Tax credit, he saw that $28,000 solar price-tag just shrink to $18,000 within the first 18 months of ownership. And when he found out both the Federal and State tax credits are shrinking each year beginning in 2019, he realized he could no longer “just think” about solar and needed to act. This is the first year, in MANY years that he’s actually looking forward to sending in his tax returns.
3. It Made Sense for Their Particular Home
Many variables went into figuring out if your neighbor’s home was right for solar. As hard as many solar companies try to convince you that “EVERY HOME IS RIGHT FOR SOLAR”, that is blatantly incorrect. Your neighbor took into consideration which way his roof faced, how large a surface he had to install on, where his trees were and if there were obvious shade areas affecting sun collection. After working with the solar company to enter all of that information into special solar software, he found his home made financial sense to add solar.
A general rule of thumb is that south facing roofs are the perfect candidates for solar. East and west facing roofs are slightly less efficient but still solid producers. If the best spots for solar are on your North facing roof surfaces, I hate to be the barer of bad news but you’re out of luck.
So those are just three of the many reasons your neighbor just installed solar on their roof. There are plenty of other reasons to go along with them. Panel warranties, Net-Metering agreements, future-proof equipment for battery storage. The list goes on and on. Did I mention your neighbor also has an app on his phone that shows him in real-time how much energy is being produced on his roof RIGHT NOW? And you thought his face was in his phone all day because of Angry Birds. Shame on you.