00119-header (1)

3 Ways to Go Solar with Affordability in Mind

May 13, 2021 by Chevron Federal Credit Union

More people are warming up to the idea of harnessing the sun’s energy to power their daily lives. Consider this fresh evidence:

  • Nearly half of U.S. homeowners say they’re considering solar panels, a Pew Research Center survey finds.
  • Last year—even amid the pandemic—a new solar project was installed in the U.S. every 75 seconds , according to the Solar Energy Industries Association (SEIA).
  • As popularity rises and cost falls, solar’s future looks bright: About one in eight American homes will go solar by 2030, predicts the SEIA.

From saving money on electricity to increasing our homes’ value, the growing interest in solar also comes as the U.S. presented ambitious goals at the Leaders Summit on Climate held last month. Clean and renewable energy targets set by industry and the Biden administration aim to turbocharge efforts to combat climate change—underscoring support of fossil-fuel alternatives like solar.

Using solar power not only cuts pollution and improves air quality, it also reduces a home’s carbon footprint. Valuable financial incentives and tax credits can help make today’s solar strategies more affordable. But it’s a big investment to weigh.

Wonder if going solar makes sense for you? Here are three ways to tap the sun’s power—and some pros and cons to consider.

Solar Panels

You’re probably familiar with this form of solar tech—the panels installed on rooftops, or in yards or fields. As the sun shines on the panels’ photovoltaic (PV) cells, they convert sunlight into usable electrical energy. That electricity is then sent either to the home or to the electricity grid.


Reduced or near zero electricity costs. Sunlight is free and lower monthly utility bills are a major motivation for going solar. What’s more, excess energy your solar panels produce can be sent to the grid in exchange for credits on your electric bill (known as net metering).

Higher home value.
Studies by the U.S. Department of Energy’s Lawrence Berkeley National Laboratory show that in six markets, solar increased the market value of a home by about $15,000. And a recent Zillow economic analysis found that homes with solar-energy systems sell for 4.1% more on average than comparable homes without.

Greater disaster resiliency.
Solar can be an important source of backup power during extreme weather events and unexpected outages.


Upfront cost. The price of installing solar dropped by 70% over the last decade, hitting a record low in the fourth quarter of 2020, concludes the latest market insight report by SEIA and Wood Mackenzie. But an average-size residential system costs about $20,000 (before any incentives), the SEIA estimates.

There’s a reason why California, Arizona and Hawaii lead the nation in solar homes: abundant sunshine. Solar panels work in all types of climates, but shade from tree cover or nearby buildings, as well as the size, slope and age of your roof, may limit suitability and savings. There are alternatives: Ground-mounted solar is one option and community solar is another. This allows multiple people to share a single solar array that’s built in a central location.

Generally, rooftop-installed solar panels stay with the home. This limitation may make them a less attractive option for people who move frequently.

Solar Generators

Rooftop panels aren’t the only way to use the sun’s power. Solar generators use smaller solar panels to harness the sun’s energy and then store it in a portable storage system for later use. 

Flexibility. Because the solar panels used for solar generators are smaller, they’re more easily moved and positioned to catch the sun’s rays. And many solar generators sold today come as complete all-in-one kits.

Low maintenance.
With no moving parts nor gas to power it, a solar generator is less likely to malfunction or need repairs over time.

Green benefits.
Gas generators lead to air pollution, fumes and added carbon dioxide in the atmosphere. They also tend to be noisy during operation. Solar generators operate both cleanly and quietly.


Limited power solution. Solar generators can’t usually power an entire house, but they can provide energy for RVs, boats, certain appliances and electronics— or as a temporary emergency backup if the power goes out.

Higher price tag.
Solar generators usually cost more than gas-powered alternatives.

Recharge time.
Recharging a solar generator takes more time (than filling a fuel tank, for example) and must be done during daylight.

Solar Batteries

Solar batteries work by storing the energy generated by solar panels (and a solar generator) for use at a later time. Batteries are typically paired with home solar energy systems.


Maximize solar energy. With a solar battery, you can store the extra energy your solar panels produce at home instead of sending it to the electricity grid.

Provide off-peak power.
Storing solar-generated electricity into batteries can help regulate solar's inherent variability—generating backup power at night, for example.


Limited scope of savings. As with solar generators, solar batteries also tend to cost a bit more. And the potential money savings associated with solar batteries often depends on how your electric utility charges residential customers and sets rates.

Not an “off-the-grid” solution.
Because they commonly store a few hours of backup capacity, most solar batteries aren’t designed to serve as a homeowner’s only source of power.

How to Make Going Solar More Affordable

Solar technology requires investment, but there are a variety of valuable tax credits and other financial savings that can help lower the bill. In fact, currently available incentives can cut your costs by anywhere from 26% to 50%, estimates EnergySage, a U.S. Department of Energy-affiliated clearinghouse for solar information and comparison-shopping marketplace. Here’s a quick look at some of the savings you can expect.

Solar tax credit.
The federal Investment Tax Credit (ITC) let you deduct 26% of the cost of solar panel systems from your federal income taxes (minus any cash rebates). Homeowners can claim the credit for solar projects they own and place in service by the end of 2022, or 22% for systems placed in service in 2023. There is no maximum cost amount. Review the rules and how to claim using  IRS Form 5695.

State tax credit.
Like the federal ITC, your state may also offer additional tax credits for installing a solar panel system. In addition, some states exempt solar systems from state sales tax and property tax assessment values.

Cash rebates.
Your electric utility, municipality or state government may reward solar purchases and installations with discounts and partial reimbursement.

Find all the incentives you may qualify for by searching the Database of State Incentives for Renewables & Efficiency (DSIRE®), developed by North Carolina State University and the DOE.

What if you can’t buy a solar system outright? You can also finance the cost through solar loans. These specialty borrowing options are growing fast and may be offered by banks, credit unions, certain municipalities, public/private partnerships and solar panel manufacturers. If you’ve been thinking about solar system options, check out Sunpro, Vivint, and Solar City.

Is Going Solar Right for You?

Most people are attracted to solar power because of the promise of helping the environment and slashing energy costs. But it’s important to get all the facts and compare the benefits and drawbacks before you make a decision for your property.

A good first step? Try the EnergySage
 Solar Calculator. It can give you a ballpark estimate of solar potential and savings where you live. Then, get an overview of key questions to consider with the DOE’s Homeowner’s Guide to Going Solar .




From everyday finance to life’s big money moments, it’s better when you belong.