In 2021, I had solar panels installed on my roof. They began generating electricity in January of 2022. In early 2023, I wrote a piece detailing how the finances of all that worked based on the first year of solar production. This is a follow up to that piece but now with three years of data covering 2022, 2023, and 2024.
My System
I got a 7.56 kW solar panel system consisting of 21 LONGi panels and 1 Solar Edge inverter. The unsubsidized all-in price for the system, including labor, was $25,525. After applying a federal tax credit equal to 26 percent of that price, the price fell to $18,889. Initially, I planned to get a loan to finance the system and the payments for that loan would have been $129 per month.
As discussed in the prior piece, due to various timing and contractual snafus, I ended up negotiating down the price a further $5,525 and then purchased the system on my cash back credit card (which I then paid off), saving me a further $400. So my all-in price was $12,963. But this was an unusual situation, so in the calculations below, I am mostly going to compare the amount of money I saved to the $129/mo solar loan.
Solar Production and Utility Bill Savings
In their first three years of operation, the solar panels produced 32,266 kWh of electricity, which is an average of 10,755 kWh per year. As illustrated in the graph below, production is higher in summer months and lower in winter months.
Over this same period, the electricity rates for my area were as follows.
Because my state does net metering, I can calculate utility bill savings by multiplying solar production by the electricity rates. I do this in the graph below. The dashed grey line is the $129/mo loan payment, which is provided for comparison.
Here is the same graph but with cumulative figures rather than monthly figures.
Over this period, the solar panels saved me $8,935 on my electricity bill, which averages to $2,978 per year. Had I been making the $129/mo loan payments, the net savings would have been $4,308 over this three year period.
Had I not used the loan but instead paid the full price up front, minus the federal tax credit, then I would have paid $18,889. With $2,978 of annual savings, it would have taken a total of 6.3 years to recoup the upfront cost. With the actual amount I personally paid — $12,964 — it will take a total of 4.4 years to recoup the upfront cost. The solar panels have a 20-year lifespan.
So ultimately, this is proving to be a very wise financial decision for me. The solar panels save me money and have required no maintenance at all. In a little over a year, I will have fully recouped my costs and have over 15 years of production still ahead of me. Even if I had not lucked into my own personal arrangement and instead taken out a loan on the $18,889 price, I’d still be saving $1,436 per year on net.