By Anne McFarland, CFP, CMC
Thinking of going solar? You’re definitely not alone. We get asked about this from time to time and wanted to share some things to keep in mind as you consider adding solar panels to your home.
Before deciding to pull the trigger consider:
- The age of your current roof and whether there is more than one set of shingles on the existing roof.
- The age of the sub roof – this may need to be replaced to hold the weight of the panels.
- The information in the brochures you receive are estimates and you may not end up being net positive for a while – it could take up to 25 years.
- If you sell electricity back to the power company this may be considered income to you and therefore taxable.
- If you take out a loan to pay for the panels, it may be more difficult to refinance as you may need to pay this loan off before refinancing.
- If you have an existing loan and decide to sell your home, you may need to pay the loan off before the house can be sold.
- You can often pay off the loans early if that makes sense in your situation.
- Why are you interested in solar? What are you hoping to achieve?
The last question is the most important. Having clarity on what has piqued your interest about solar helps to ensure the values or goals behind the idea are truly achieved by installing panels on your home.
- Is this a new idea or one you’ve been considering?
- Did a salesman knock on your door? Did you get promotional materials in the mail? Do you look around your neighborhood and see solar panels on many houses? (I certainly do in my neighborhood!)
- What’s driving your interest in solar? Is it because you believe it is good for the environment? You see benefits for your long-term pocketbook? You are attracted to the feeling of independence generating your own power may provide?
As you consider what’s driving your curiosity about solar, you can then make a decision that supports your ultimate goal or desire.
Say that as you explore solar you learn that the sub-roof on your home would need to be replaced to support the weight of the panels, but a significant roofing project on top of the investment in solar panels doesn’t make sense for you. What then? One option would be to buy into a community solar project.
Before deciding on that option, ask yourself if it would achieve your goals.
If helping the environment is one reason for considering solar panels buying into a community solar project allows you to support solar from an environmental standpoint without taking on a significant roofing project.
If reducing your energy cost matters to you, you may be able to get your electricity at lower rates if the community solar project is controlled by the power company.
If energy independence is your goal, buying into a community solar project may leave you feeling unfulfilled or frustrated.
Like any financial decision, adding solar panels to your home is ultimately about your goals and values. Keeping what matters to you in the forefront will help ensure you are happy with whatever you decide.