The Texas sun and solar power are made for each other

It’s hot in Texas, and solar power is taking off. 

Despite the fact that Texas is a state that makes a lot of money on fossil fuels, it is undeniable that solar power is catching on all over the state.

One of the hotbeds is Austin TX and this is why we are choosing it as the fifth city in our ongoing series outlining the cost of solar power in different areas.

The home we picked is in the Northern part of Austin, it is a single family home of about 1,400 square ft and a family of four live there. It’s the typical American family of two parents and two children, a brother and sister. There is a pool in the backyard and because the summers are long and the winters are short in Texas, that pool is used for nine months out of the year. Luckily the power in Texas is not as expensive as in other states, so this family of four uses quite a lot. 

It still is a pretty large home with lots of electricity being used, so the average monthly electric bill is $200. The pool gets a lot of heat from the sun, but in colder months, it does require a lot more energy to keep it comfortable. When we enter the address and monthly bill in the HahaSmart Price Checker tool,  we find out that solar is affordable even in states where power is less expensive by the kWh.
 

The breakdown of the cost of solar materials 

The site recommends a 10.7 KW solar panel system and it gives a breakdown of the cost of the system and all the permits needed. First, you will need the approval of the design and a permit to build the solar system. That engineering and permitting process would cost $798. Then if you add up all the equipment, the solar panels, the power inverters, the racking, the material needed to mount the panels, and other miscellaneous items come to about $12,570. If you add the sales tax of about $1,053 it brings the total to $13,624 in equipment and permitting. Sales tax in Texas is a little different. The state has a 6.25 percent tax, and local jurisdictions add some city tax too. In Austin, the combined rate is 8.25 percent tax.
 

How much it costs for solar panel installation?

Installation costs can vary, but at HahaSmart, we compiled data from 2296 different installers and we can say the cost range is from about $8,048 to $11,803 to install the solar panels. If we average the two numbers we get $9,925 as an average installation cost. It is important to shop around for the best installer for your needs. Some of the less expensive ones are not necessarily the best ones. On the other hand, many local installers are certified, they care about their work, and they are, many times, less expensive than national chains. We recommend that you talk to at least two different installers and find one that is the best for your situation.
The total cost and the federal tax credit applied

If we add the grand total of $13,624 and $9,925 we get $23,549 before local, state, and federal tax incentive programs. Because programs differ in every state, we are only applying the 30 percent federal tax credit. After we factor in the tax credit, the net cost of buying and installing a residential solar panel system the Austin area is about $16,484. Again it is important to check local and state governments for incentives and help with the cost. 

For example, Austin Energy has some great programs for solar power that can really help homeowners out. 
 

The Value of Solar Tariff

One program that really helps is the Value of Solar Tariff. The Value of Solar Tariff or VOST program is open to those who own or lease their solar system. VOST pays you for every kilowatt-hour (kWh) of electricity your solar energy system produces at a rate of 10.6 cents per kWh. You still pay your utility for the electricity you consume at standard residential rates, but you also get a credit on your bill for the amount you produce each month. If your production makes more money than your consumption for the month your extra credits roll over. At the end of the year, your unused credits roll over to the next year. This represents one of the best net-metering programs in the country.
 

Austin solar energy rebate

This incredible rebate is only eligible to those who own their solar power system and use an Austin Energy approved installer to go solar. The Austin Energy Rebate pays you $0.50 for every watt in the size of your system, up to 50 percent of the total cost of installing your solar system. If you install a 6 kW system you would receive a rebate of $3,000. For the 10.7 kW system, you would receive almost double that.
This is why it is always important to check out every rebate, or program available for people who want to install residential solar. In Austin, the initial cost of the system minus the Austin energy rebate equals the final cost of your system. Then when you add the 30 percent federal tax credit, you win again. Then finally after everything is installed and running, you get to enjoy one amazing net-metering program.
 

The solar panel payback to yourself

If you take into account in the old monthly bill average of $200, and at least a 20 year lifespan on those solar panels and the cost of the whole system, it is estimated that the homeowner would be able to pay off those solar panels in approximately 6.1 years, with a payback rate of about 14.9 percent each year. After that, you are saving money every month. Some companies that don’t use HahaSmart tell customers that their payback period is much longer, so be sure to find out if you are using a HahaSmart Verified Installer.
 

How much could you save on electricity costs?

After 20 years, a homeowner who installed solar panels on their home could save approximately $57,226 in electricity costs. After you factor in the tax credits, that payback is almost four times what the panels originally cost.

Of course, all these prices and savings amounts can change slightly when different brands of solar panels and inverters are used, but the general point is that installing solar panels on a home in Austin TX still is less expensive than most new cars. They also increase the value of the home, they pay for themselves in less than five years, the whole solar panel system can save a homeowner almost $60,000 in power costs, and you can run the air conditioning endlessly and use the pool at your will. Why wouldn’t someone want to go solar if they had the chance?

To learn more about how you can participate in the solar power revolution, you can visit HahaSmart, and try out our Price Checker Tool yourself. You can not only see how much a solar panel system would cost, not just in Austin TX, but in your area too. Enter the information and see how much you can save in the next 20 years.

For information relating to going solar don’t forget to visit our solar blog section for more handy guides and articles.