Solar energy systems not only offer opportunities to help save the planet’s natural resources but give home and business owners the chance to save money as well. Governmental incentive programs can greatly reduce the cost of installation. The remainder is recouped over time through monthly savings on electric bills. The return of investment period may be accelerated through sales of any surplus electricity that the system produces back to the utility.
How Solar Energy Works
Photovoltaic (PV), which literally means “light electricity,” is a technology that converts energy from the sun into power. As sunlight hits the solar cells, electrons that break free from atoms are converted to electricity. In home and commercial PV installations, solar cells are connected and framed into solar panels. As PV systems produce DC electrical current, an inverter that converts the energy into the AC current that buildings use is also included in the installation.
PV Installation Options
Home and business owners have the option to purchase a PV system outright or to lease a system. Depending on the location of the installation, owners can save up to 60 percent or more on installing costs through government and utility tax credit and rebate programs. With a leased system, a solar provider owns the system. Leased systems are typically available for little or no money down. The solar company installs, insures and maintains the PV system. Most leases require the home or business owner to pay the solar provider for the electricity that the installation produces. This is generally less than was being paid for traditional electricity.
Most utilities will either pay the PV system owner outright for any excess electricity that the installation generates or will issue a credit for the power. In many areas, owner are issued a certificate for surplus energy that serves as a financial instrument that can be sold on the energy market. PV system owners can expect their system to generate electricity for 25 to 30 years. As the ROI on the average system is around 10 years, the owner will enjoy many years of free electricity.