Electricity Costs at All Time High- Why Solar Makes Sense
According to the Bureau of Labor Statistics, 2014 was the most expensive year for electricity to date. In January of this year, the price for electricity hit an all time high. With electricity costs on the rise, a solar system for your home is an excellent investment and can allow you to “lock-in” a much lower rate through the life of your system.
How does it work?
When installing a solar system on your home, you are essentially pre-purchasing 25 years of guaranteed power at a fixed rate. By determining how much power your system will generate over its lifetime and comparing this to your cost of electricity and the expected continued rise of electricity costs, the fixed rate of electricity can be calculated. Take a look at a recent customer of our’s as an example:
The levelized cost of electricity (LCOE) is calculated by dividing the total project cost after incentives (i.e. the 30% federal tax credit and the estimated SREC revenue) by the total amount of energy the system is estimated to produce over 25 years based on the solar module manufacturer’s 25 year power production guarantee. The proposed solar system’s levelized cost of electricity can be calculated as follows:
Therefore, with the solar system you essentially lock in the cost for this portion of your electricity needs at the very low price of $0.068/kWh! The graph below shows this levelized cost for each system compared to the utility electric rate which was estimated to increase 3% annually.
Contact us for a FREE SITE ASSESSMENT to lock in your lower rate for the next 25 years!