How to Plan a Solar Electric System?

There are a number of steps that you need to follow when planning to start using solar energy for your home. After choosing the Solar option that works best for you (see Step 3), follow the steps below that apply to you. Your solar installer and local utility company can provide more information on the exact steps you need to take to get your home solar powered.

  • Investigate your home’s energy efficiency
  • Assess your solar potential and any limitations
  • Assess your options for going solar
  • Estimate your solar electricity needs
  • Obtain bids and site assessments from contractors
  • Understand available financing and incentives
  • Work with your installer and utility to install the system and set up agreements

1. Investigate Your Home’s Energy Efficiency

Before starting using solar power to power your home, homeowners should research their energy usage and consider potential efficiency gains. Homeowners should be aware of their total electricity consumption and consider cost-effective and easy-to-implement efficiency measures before choosing solar.

Explore the following resources to reduce your electricity use:

  • Home Energy Audits: A home energy audit can help you understand where your home is losing energy and what steps need to be taken to improve your home’s efficiency.
  • Devices and Electronics: Use your devices and electronics more efficiently or invest in highly efficient products.
  • Lighting: Switch to more energy-efficient lighting, such as a LED light bulbs.
  • Heating and Cooling: When you use electricity to heat and cool your home, your heating and cooling needs will significantly affect the amount of solar energy you need. Weatherproofing your home and heating and cooling it efficiently will reduce the amount of electricity you need to produce using solar energy.

2. Assess Your Solar Potential

Before deciding on the best way to use solar electricity in your home, you should evaluate the potential solar energy that can be generated at your address. Because PV technologies use both direct and scattered sunlight to generate electricity, the solar resource in the US is sufficient for solar power systems at home.

However, the amount of electricity that is generated by a solar system at a given location depends on how much solar energy it receives and how large the system itself is.

Various map services and tools are available to help you determine your home’s solar energy potential. Some of the services also provide information about the estimated system size, potential costs and savings, and local contractors.

These tools are a great place to start and can help you determine if your home is solar eligible, and if not, the best way to keep getting solar energy. While these tools are helpful, they do not take into account all of the variables that need to be considered for your particular system.

To do this, you need to work directly with a solar installer who can provide an accurate assessment of your solar potential as well as detailed recommendations, estimates, and equipment knowledge.

Consider the following:

  • There are shady trees nearby. Contractors will also help assess shading, but will also take into account your own or your neighbor’s trees that may still grow and shade your system in the future.
  • The age of your roof and how long it will be before it needs to be replaced. If you expect to need a new roof in the next few years, consider this improvement before installing solar.
  • Neighborhood or Homeowners Association (HOA) restrictions or permit requirements. Some states now have “solar regulations” that restrict HOAs’ ability to restrict solar systems or restrict access to solar energy. These regulations vary from state to state and from municipality to municipality. Find out about your own HOA agreements and state laws.

3. Assess Your Options for Using Solar

Buying and installing a system that you fully own and maintain is no longer the only option when making the move to solar power. Even if you want to rent your home or don’t want to buy a roof system, there are plenty of programs out there that can still help you benefit from solar power.

Below are some options for using solar energy at home. Check with local installers and your utility for programs available in your region.

Purchasing A Solar Energy System:

Buying a solar panel with cash or a loan is the best option if you want to maximize the financial benefits of installing solar panels, take advantage of tax credits, and increase the market value of your home. A solarization program is not available or impractical.

The solar installer will connect the system to the power grid and obtain connection permission from the utility company. If the PV system generates more electricity than the homeowner needs, the customer can often sell excess electricity to the grid. If the homeowner’s electricity needs exceed the system’s capacity, the house draws energy from the grid as usual. Learn more about grid-connected house energy systems.

Purchasing a solar energy system is a good option if one or more of the following apply to you:

  • You want to purchase a solar energy system to install at your home
  • You are eligible for state or federal investment tax credits
  • You are willing to be responsible for maintenance or repairs (note that most solar energy systems offer warranties, and many installers offer operations and maintenance plans)
  • You want to reduce your electricity costs
  • You want to sell unused electricity produced by your system back to your utility through a net metering arrangement
  • You want to increase your home’s value
  • You have the upfront capital to purchase the system or access to capital through a lender (note: many banks, utilities, and solar installers offer financing arrangements for solar systems).

Community Or Shared Solar:

Almost half of all US households are unable to operate a solar system on the roof because they rent a roof area or because they are insufficient. If you can’t host a rooftop system, you can also invest in a community or collective solar program.

These programs allow a group of participants to pool their purchasing power to purchase solar energy in a solar system at a level that suits their needs and budget. The system can be on-site or off-site and owned by utility companies, solar developers, nonprofits, or multiple community members.

Consider community solar if one or more of the following apply to you:

  • You are unable or do not want to install solar at your home or property
  • You are unable to claim state or federal investment tax credits
  • You do not want to be responsible for maintenance or repairs

Solar Leases

If you rent a solar system, you can use the electricity generated, but someone else – a third party owns the PV system equipment. The consumer then pays to rent the equipment. Solar leases often involve limited upfront investments and fixed monthly payments over a set period of time.

Under a lease agreement, homeowners typically pay the developer a flat monthly fee for the equipment based on the estimated amount of electricity the system will produce. This amount is often cheaper than the original electricity bill.

Solar leases are a good option if one or more of the following apply to you:

  • You want to install solar at your home, but you are unable or do not want to purchase a solar energy system
  • You are ineligible for state or federal investment tax credits
  • You do not want to be responsible for maintenance or repairs
  • You want to reduce your electricity costs
  • You want to sell unused electricity produced by your system back to your utility through a net-metering arrangement.

Power Purchase Agreements (PPA)

With PPAs, consumers can host solar systems from solar companies and buy back the generated electricity. This is a financial agreement where a developer arranges, permits, finances, and installs on a consumer’s property with little or no upfront cost.

The host consumer agrees to purchase the electricity generated by the system at a set price per kilowatt hour of electricity generated over the life of the system. The purchase price for solar power is often less than the retail price of the local utility company.

PPAs are a good option if one or more of the following apply to you:

  • You want to install solar at your home, but you are unable or do not want to purchase a solar energy system
  • You are ineligible for state or federal investment tax credits
  • You do not want to be responsible for maintenance or repairs
  • You want to reduce your electricity costs
  • You want to sell unused electricity produced by your system back to your utility through a net-metering arrangement   
  • You are interested in procuring solar at a limited up-front cost.

Solarize Programs

One of the most efficient ways for communities to run solar is through a solarization program. With Solarize programs, a locally organized group of homeowners and businesses can pool their purchasing power to competitively select an installer and negotiate reduced prices. This bulk purchase allows more people to run solar as the group model simplifies the process, increases demand for solar, and also lowers installation costs.

Solarize programs are a good option if one or more of the following apply to you:

  • A Solarize program is available in your area
  • You want to purchase a solar energy system to install at your home
  • You are eligible for state or federal investment tax credits
  • You are willing to be responsible for maintenance or repairs (note that most solar energy systems offer warranties, and many installers offer operations and maintenance plans)
  • You want to reduce your electricity costs and sell unused electricity produced by your system back to your utility through a net-metering arrangement
  • You want to increase the value of your home.

4. Estimate Your Solar Electricity Needs

Gather information about your home and electricity usage to help your contractor make recommendations for the type and size of your system.

Check your utility bills to see annual electricity needs. Your usage is shown in kilowatt hours (kWh). Check every month of the year; In some months you may be using more electricity than in others (e.g. if you run the air conditioner in summer). Some utilities provide tools that can help with this check.

Take into account any planned changes. Buying an electric vehicle or planning to expand your home can increase your electricity needs. If you continue to make significant changes to improve the energy efficiency of your home, you may end up using less electricity than you have in the past.

5. Obtain Bids and Site Assessments from Solar Installers

When looking for installers, make sure you find qualified and insured professionals with the right certification. The standard certification for the solar industry comes from the North American Board of Certified Energy Practitioners.

You can also ask friends and family who recently ran solar for testimonials and check online resources for reviews. Before making any commitments, obtain proof of license prior to working with an installer.

There are also tools online that make it easy to find and compare solar installers. Receive at least three quotes for the installation of the PV system and ensure that the quotes are based on the same characteristics and metrics to allow for comparison shopping.

When interviewing installers, consider asking the following questions:

  • Is your company familiar with local approval and interconnection processes? Often times, getting building permits and permission to connect can be long and tedious processes. Make sure the installer is familiar with these local processes to ensure that your system is installed and connected immediately.
  • Can the company provide references from other customers in your area? Talk to other customers in the area to find out what challenges they faced and how the company helped solve those issues.
  • Is the company properly licensed or certified? PV systems should be installed by a suitably licensed installer. This usually means that either the installer or a subcontractor has an electrical installer license. Your state electrical engineering agency can tell you whether a contractor has a valid electrician license. Local construction departments may also require the installer to have a general contractor license. Call the city or county you live in for more information about licensing. In addition, solarization programs may require you to work with a specific installer to receive the reduced system price.
  • What is the guarantee for this system? Who is responsible for the operation and maintenance of the system? Most solar systems come with a standard industry guarantee (often 20 years for solar modules and 10 years for inverters). Making sure the system is backed by a strong warranty is often an indication that the installer is using high quality equipment. Likewise, the homeowner should determine whose responsibility it is to properly maintain and repair the system. Most lease and PPA agreements require the installer to perform system maintenance, and many installers offer competitive O&M plans for systems owned by the host.
  • Does the company have pending or active judgments or liens against it? As with any project that requires a contractor, due diligence is recommended. Your state electricity board can notify you of judgments or complaints against a state-licensed electrician. Consumers should call the city and county they live in for information on how to evaluate contractors. The Better Business Bureau is another source of information.

The offers should clearly state the maximum generation capacity of the system – measured in watts (W) or kilowatts (kW). Also request an estimate of the amount of energy the system will produce annually or monthly (measured in kilowatt hours). This number is most useful for comparing it to your existing utility bills.

The offers should also include the total costs for commissioning the PV system, including hardware, installation, grid connection, approval, sales tax and warranty. Cost / Watt and Estimated Cost / kWh are the most useful metrics for comparing prices between different installers, as installers may use different equipment or offer quotes for systems of different sizes.

6. Understand Available Financing and Incentives

Small solar systems can receive a tax credit of 30% until 2019. The tax credit decreases to 26% in 2020, then to 22% in 2021, and expires on December 31, 2021.

If you opt for a solar lease or power purchase agreement, remember that you are not eligible for this tax benefit because you do not own the solar energy system.

You can search the Database of Government Renewable Energy Incentives and Efficiency (DSIRE) for additional government, local, or utility incentives.

In addition to incentives, find out about all the solar finance options available. Every situation is different, and what is best for your property depends on a variety of factors. The Clean Energy States Alliance guide will help homeowners understand their options and explain the pros and cons of each option.

7. Work with Your Installer and Utility

If you decide to install a solar system, your installer should be able to help you complete the necessary permits and steps.

Your installer will determine the appropriate size for your system. The size depends on your electricity needs (determined in step 4) as well as the following:

  • The solar resource of the site or the available sunlight
  • Orientation and inclination of the system
  • The efficiency of the system in converting sunlight into electricity
  • Other power sources such as a utility company, wind turbine, or fossil fuel generator.

Your installer will also ensure that all equipment is properly installed and oriented and tilted to maximize the daily and seasonal solar energy received and produced by your system.

Make sure you know how billing and net metering work, as well as any additional charges that you will have to pay.