Average Monthly Electric Bill With Solar Panels

As electricity costs rise throughout the country, many homeowners are looking for alternative ways to power their homes and save money on their electricity bills. Solar has become a popular choice because it is a reliable and sustainable energy source. But how much do solar panels save? In this blog, we’ll look at the average monthly electric bill with solar panels, factors that can affect these savings, and whether solar panels may fit your home.

Solar Electricity Costs

With solar panels, your average monthly electric bill may be lower, but you may be saving less than you expected for several reasons. These include:

Solar Energy

1. Weather + Seasonality

Solar panels convert sunlight into energy, so less sunlight means less power. The amount of sunlight that’s available varies based on the weather and the time of year. For example, solar panels can still generate power through cloud cover, but it may not be enough to meet your home’s energy needs. On a cloudy day, you may have to use grid electricity in addition to your solar system to keep everything powered. Similarly, it’s common to use more grid power during winter when the days are shorter. Neither of these factors are a cause for concern, as solar savings are best calculated on an annual basis.

2. Grid Charges

Most solar systems are connected to the grid, so homes still have access to electricity even when their panels don’t produce enough power. Utility companies will charge fees for being connected to the grid. Your electricity bill includes several service charges on top of your electricity usage prices. Fees depend on your utility company, but common ones include:

  • Service fees. These fees cover the cost of customer service, billing, or other utility operations.
  • Transmission fees. These cover the cost of the transmitters that send electricity from generating sites to your home.
  • Building and maintenance fees. These cover building and maintenance costs for distribution systems.
Solar Grid
Solar Battery Backup

3. Battery Backup

Nights and cloudy days aren’t as big of an issue if you have a battery backup system with your solar installation. If your home uses less energy than your panels produce, your system can store the excess power in batteries for later use. You can use that energy when the sun isn’t shining and reduce your reliance on the grid to maximize savings. If you don’t have battery backup, you can’t store excess energy and will have to rely on the grid if your solar panels don’t produce enough power.

4. Your Local Net Energy Metering Policy

Net metering lets solar owners receive credit from their utility company for excess energy their systems produce. If your solar panels generate more power than your home uses, you can feed the extra energy back to the grid for a credit on your monthly bill. However, some utility companies don’t offer this program. If your utility company doesn’t offer net metering, you won’t receive credit for excess energy, and you may not save as much on your electricity bill.

Solar Meter
Reducing Energy Cost

Average Monthly Electric Bill With Solar Panels

How do solar panels affect your average monthly electric bill? Here’s a look at how bills differ before and after solar.

Before Solar

Electricity bills often comprise a significant portion of a home’s monthly expenses. You need electricity for everyday activities like cooking, powering electronic devices, and heating/cooling homes. For many homeowners, electricity bills can be a significant source of financial stress, especially during times of high energy use, such as the summer or winter months. Homeowners can save money on electricity bills by reducing energy usage and switching to energy-efficient appliances — but adding solar can add even more opportunities to save.

After Solar

With solar panels, your average monthly electric bill may be lower. Panels generate energy from the sun, which can offset the electricity you need to purchase from your utility companies. In some cases, you may be able to create more energy than you use, which can result in a credit on your utility bill. The money you can save on your monthly bill can vary depending on your circumstances. However, even a modest solar system can help to reduce your monthly costs.

Can Solar Completely Eliminate My Electricity Bill?

While solar panels can reduce your monthly electric bill and provide long-term savings, it’s rare for panels to completely eliminate your electricity bill. The amount of money you can save depends on several factors, such as where you live, your system size, and your home’s energy usage. You can contact a solar company to discuss these factors and how much solar panels can save you.

Eliminate Energy Cost

Solar systems can reduce reliance on grid electricity and may lower monthly energy costs. However, savings will vary depending on several factors. These are outlined below.

Location and Energy Use

If you live in a sunny climate, your panels can generate enough power to help you rely less on expensive grid electricity. The more sunlight your home receives, the more energy your panels may be able to generate. However, how much energy your home uses will affect your monthly electric bill. If you use a lot of energy, you may need to use more power from the grid, no matter what kind of climate you live in.

Solar System Size and Installation Cost

The size of your solar system can impact how much solar panels save on monthly electricity bills. Generally speaking, the larger your system, the more energy it can generate, and the less you’ll need to rely on the grid. However, larger systems typically cost more money to install and may increase your upfront costs.

Tax Credits and Incentives

Several tax credits and incentives are available to make installing solar more affordable for homeowners. These credits may reduce the cost of installing a solar system and increase your savings over time. The most popular of these credits is the Federal Solar Tax Credit, which gives solar owners a 30% tax credit for the total cost of their system. Many states also offer rebates or property tax credits for solar owners. Some utility companies have net metering programs, allowing homeowners to sell unused solar energy back to the grid for credit.