Getting Started

There are two kinds of solar technology you can install on your home. These systems are separate – one for your electricity and one for your hot water.

Solar PV, or solar photovoltaic, panels generate electricity and offset how much electricity you purchase from the utility company. You can also install a solar water heater, which uses the sun’s energy to heat your home’s hot water, and can reduce your utility bill by approximately 15%.

Solar PV

Solar photovoltaic panels convert sunlight into electricity. Solar panels are most often mounted on the roof of your home, or on the ground, and are connected to the power grid.

Your solar system reduces the amount of electricity you need to purchase from your utility company by generating electricity during the day, when electricity is the most expensive to purchase. If you produce excess electricity – or more than you need for use in your home – the utility company will buy it back from you. This is why solar is one of the best ways to lower your monthly energy bill. And it’s a great hedge against rising energy costs over time. Solar PV systems are very reliable. They have no moving parts, will harness the power of the sun’s rays, and are designed to last up to 25 years.

How does solar PV work?

When beginning the process of selecting a solar electric system for your home, it is helpful to understand the basics of how your system works.

A solar PV system is made up of a number of critical components:

Module – This is the system’s core piece, multiples of which make up an array. The module is the actual panel that goes on your roof. The direction that the module faces is dependent on the most reliable, unobstructed source of sunlight, and is the key to maximizing output. The best orientation is usually facing the south.

Solar Photovoltaic Cells – The module is made up of solar photovoltaic (PV) cells, which are protected by glass and absorb the photons produced by the sun, turning them into electricity.

Inverter – The inverter converts the direct current (DC) electricity from the module to the more commonly used alternating current (AC) electricity.

Production Meter – After installation of the system, a production meter will be put on your house to measure the electrical output of your solar PV system.

Solar Water Heater

Solar water heaters do not use solar photovoltaic cells. Instead, they apply the sun’s heat directly to a solar collector, which transfers heat to a water storage tank. The tank is insulated to retain heat through periods where the collector is less effective, such as overnight or on overcast days.

How Much Will it Cost?

Everyone’s solar system is different. The cost will depend on the size of your system and how much money you would like to trim from your monthly electric bill. There are additional factors, including the direction your roof faces and the amount of shade it receives. And you can decide if you want to own your system, finance it, or lease it from an installer. All these financial options are available to you today.

The good news: There are three rebate and tax credit programs designed to reduce your cost, cutting it as much as 50%:

Federal – There is a 30% tax credit, with no cap, which equals 30% of all your out-of-pocket solar installation expenses.

State – The Arizona Solar Credit provides you with a 25% tax credit, with a $1,000 cap.

Your Utility – APS currently offers a $1.00 per watt rebate, while SRP offers a $1.35 per watt rebate (however, this is capped at a 5kW system). This means that for an average size system in Arizona (6kW) the APS rebate is $6,000.

You can assign the rebate to your installer to limit your out-of-pocket costs. And that’s a big help to you.

Financing Options

In addition to federal, state and utility credits and rebates, there are several ways to make your solar system more affordable. Here’s what most of your neighbors do:

Home Equity Loan – You can pay for your system with a home equity loan, which allows you to pay a manageable monthly expense. You can also deduct any interest you pay.

Leasing – The upfront costs of solar can be prohibitive. Leasing – with upfront costs often as low as $1,000 – is becoming a more popular option. In this case, the supplier/installer owns the system and sells the electricity back to you. Most likely you will still pay less per month than you currently do, so you will see the best of both worlds: savings and solar. Not every installer offers leasing, and you would have to qualify. Ask your Solar Coach for more details.