San Diego is perfect for solar

You probably cannot find better weather for solar panels than in San Diego CA.

The average daytime temperature is 75 degrees Fahrenheit. In the heat of the summer, the average hits close to 79 and dips to a comfortable 69 in December and January. Since solar panels work best at 77 degrees, they easily work at or near peak performance all year long.

In the winter it rarely gets too cold, and in the summer it has long days that are the definition of comfortable. That is why we picked San Diego for our next hypothetical home that needs some solar panels.

Please keep in mind that most of the time we use averages and estimations such as average monthly bill in an area, so individual results may vary from county to county. In San Diego, we picked a home that is modest in size, and it is updated to modern building codes for energy efficiency.

This home has no air conditioning, they rarely use the heater in the winter, and the family of three inside primarily open windows and use the ocean air to keep the home cool when it gets warm.

Because this family lives in a temperate area, and they have a modern home and watch their power consumption, their electric bill averages $100 a month.

If we enter in the address and the $100 a month electric bill into our HahaSmart Price Checker Tool, it recommends a 3.3kW system for the home. The home is not covered by trees, and there is plenty of roof space. The panels on the roof are facing east to capture the sun all day long as it passes over San Diego, giving them more than enough power for the family.

Power in California is more expensive than in other parts of the country, so even though the solar panel system is smaller, the payback is still quite fast. Let’s take a closer look.
 

How much it costs for the solar system equipment 

Now as we stated earlier, the HahaSmart Price Checker Took recommends a 3.3 kW solar panel system and it gives a breakdown of the cost and the permits needed. The first step is to get the approval of the design and a permit to build the residential solar system. That engineering and permitting process costs about $798.

If you add together the cost of the solar panels, the power inverters, the racking, the material needed to mount the panels, and other miscellaneous items, the total comes to about $5,319. The sales tax in San Diego County is a livable 7.75 percent which is better than many cities in California. If you add the sales tax of about $412 it brings the total to $5,731 in equipment and permitting.

It is important to note that this cost does not include the electrical main service panel upgrade, and expenses or interest you accrue if you choose to finance your solar system.
 

The average cost for a solar system installation

The HahaSmart price checker tool compiles data from nearly 2300 different installers and it states the installation cost is from $4,125 to $4,587 for the solar panels. If we average the two numbers we get $4,356 as an average installation cost.

Installation costs can vary and we recommend that you compare two to three different installers quotes for your needs. When you talk to multiple installers please note, local installers are certified and they care about their work. Many times they are also less expensive than national chains. Talk to multiple installers and find one that produces the best solar panel system for your situation. 

Generally, a solar installation package includes an application for a solar installation permit from the local building safety department. A plan and layout of the overall installation, a guarantee from the installation company that the project will be done right, and then a permit to operate the solar system. 
 

The total cost and the federal tax credit applied

Now to get the grand total for the project, we add the product cost of $5,731 and the installation cost of $4,587, and we get $10,126 before local, state, and federal tax incentive programs. That means before any other savings are explored, the cost per watt for this system is $3.06 per Watt.

Every state has different programs for solar, but we know that everyone is able to take 30 percent of the total installation cost and deduct it in their income taxes If we factor in the tax credit, from the system, the homeowner is allowed to write off $3,038. If we subtract this from the overall cost, it drops the cost down to $7,088.
 

Solar powered net-metering from the utility

Again it is important to check local and state governments for incentives and help with the cost. For example,  San Diego Gas and Electric has great programs for solar power. The company participates in net-metering and is helpful to solar customers in the area. Their net metering program is also simple and similar to net metering programs around the country. 

Basically, the SDGE net-metering program works like this. As a customer generates power during the day, and power they are not using is sent back to the utility and the homeowner is credited that amount. During the evening, when the panels are dormant, the customer is credited the amount of power they generate during the day. At the end of each month, if the customer generates more power than they use, the amount is carried over to the next month as a credit. After a 12-month cycle, the customer may opt to roll over credit indefinitely or to receive a check for the power they didn’t use.
 

Property Tax Exclusion for solar energy systems

California also helps out homeowners who want to go solar. They are able to deduct either 75 or 100 percent of a solar panel system from state property taxes. They can deduct 100 percent of the panels, storage devices, power conditioning equipment, transfer equipment, and parts. They are only able to deduct 75 percent of the pipes and ducts for the solar system.

Likewise, dual-use equipment for solar-electric systems qualifies for the exclusion only to the extent of 75 percent of its value. Here is a link to the State Board of Equalization to explain it in more detail.
How much could you save on electricity costs?

After 20 years, a homeowner who installed solar panels on their home could save approximately $31,344 in electricity costs. After you factor in the tax credits, the initial payback of the system is 5.4 years, and overall the family can save more than four times what the panels originally cost.

All these prices and savings amounts can change slightly when different brands of solar panels and inverters are used, but the general point is solar power is less expensive than most new cars. Those panels also increase the value of the home, they pay for themselves in a little more than five years, the whole solar panel system can save a homeowner $31,000 in power cost

To learn more about how you can have a $0 electric bill, even if it is hotter than San Diego, visit HahaSmart and try out our Price Checker Tool yourself. You can not only see how much a solar panel system would cost and how much you can save.

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