Facts About Solar Electricity

There are lots of facts about solar electricity to keep in mind when installing or thinking about installing a solar power system on your home.

Solar energy is one of the cleanest and most abundant renewable energy sources available. As manufacturers continue to find ways to make solar energy systems more affordable, it’s good to keep in mind that most industry trends show a progressive drop in prices even as solar installations are on the rise.

The current solar energy wave in the United States can be traced back to the oil embargo of 1973-1974, furthered with the second embargo in 1979. During that period of oil shortages and high prices, solar collector manufacturing firms took off from 45 to 225 companies.

Renewed focus on alternative energy sources has arisen over the last five years with oil and gas prices fluctuating dramatically and the U.S. searching for ways to attain greater energy independence.

Currently, renewable energy sources provide around 8 percent of the Unites States’ energy, with solar energy representing 1 percent of our total consumption, according to the EIA.

Facts About Solar Electricity Industry Trends

Solar electricity usage is clearly on the rise. In fact, some reports show that solar energy is the fastest growing energy technology in the U.S., with the solar industry rising to $6 billion in 2010, up 67 percent from $3.6 billion in 2009. Since 2006, solar electric capacity installations have jumped from less than 200 MW to nearly 1000 in 2010 (one megawatt (MW) of solar PV capacity can power 150 to 250 homes).

The United States solar panel industry rose by 30 percent between 2008 and 2009, posting a record high in total shipments of cells and modules. Over a longer term, solar shipments have exploded, going from less than 200,000 peak kilowatt shipments in 2000 to more than 1.2 million in 2009 – with solar modules consuming the majority stake of shipments.

Following that trend, more companies are manufacturing or importing solar cells or modules than ever before, with the industry seeing a leap from 66 companies in 2008 to 101 in 2009.

In more consumer-friendly trends, 2009 saw a noticeable decrease in prices in solar materials, with the average price of modules dropping by 20 percent, from $3.49 the year before to $2.79.

Facts About Solar Electricity Cost

Solar electricity costs around $10 to $12 per watt installed. A comprehensive solar electric system installed on a typical home costs between $20,000 and $25,000 – including the cost of materials and labor. Many choose to eliminate labor charges and install systems themselves using solar panel kits, while many homeowners install, or have installed, smaller solar power systems that provide a level of sun-generated electricity to their homes but still rely on the utility for a portion of their total electrical consumption.

Facts About Solar Electricity Tax Incentives

The federal government offers a significant incentive to homeowners that install a renewable energy power system. Specifically, you are able to deduct 30 percent of the cost of the system from your federal tax returns through the renewable electricity credit for taxpayers. For solar power systems installed after 2008, there is no cap on the amount you can deduct.

Most states offer incentives on solar power system installations as well, including rebates and state tax credits. Check with your state to see how much you can deduct.