Thinking of going solar? In this blog, we answer the questions you should be asking about qualified solar installers, how much solar you need, if solar will work on your roof, financing, tax incentives, insurance coverage, utility credits, storage, and maintenance.
Which Solar Providers are Qualified to Install Solar?
Many homeowners are unaware that salesmen, contractors, and installers are not necessarily employed with the same company. Additionally, they may not all be licensed, bonded, and insured, or have the qualifications and expertise required for the work. This is especially true with solar installations.
The best solar companies employ their own salesmen and installers.
In the solar industry, NABCEP certification is the gold standard in knowledge, experience, and professionalism for solar installers. This certification should be held by your solar salesman, provider, and installer.
Before you hire a solar provider, you should check their contractor’s license class (which allows them to perform the work listed in the contract), license record, and references. In Arizona, you can check this information with the Registrar of Contractors (ROC) at roc.az.gov.
For more information, read our blog: How to Hire an Awesome Solar Installer.
How much solar power do I need?
The average home in Arizona uses approximately 14000 kWh/year. However, every home uses power differently. Before you buy solar, you should know your average power use and how much your utility company allows to be replaced by solar. Do NOT let your solar company make that decision for you without your first knowing how much you need.
Simply dividing your annual power use by 1.6 will tell you how many watts you should generate.
Some utility rate structures limit the credit you can receive from generating excess power. If your utility is Arizona Public Service (APS), you would multiply your annual watts by 110%. If your utility is Salt River Project (SRP), you would multiply your annual watts by 60%.
Solar panels are sold by watts. While they can vary from 150-400 watts, a good panel will generate 315 to 400 watts. Make sure you know the watt size of the panels you are buying. Dividing by the watts per panel will determine how many panels you need.
14000 kWh ÷ 1.6 = 8750 watts.
8750 x 110% = 9625 watts
9625 ÷ 400= 24 (400 watt) panels
8750 x 60% = 5250 watts
5250 ÷ 315= 17 (315 watt) panels
About Your Roof
Do I need a new roof?
Roofs have a 20-50 year lifespan. Unless your roof is nearing the end of its lifespan, your roof will not need to be replaced prior to installing solar panels. Your initial solar consultation should include an inspection of the age and condition of your roof.
How will solar panels affect my roof?
When installed correctly by a licensed, insured, and experienced solar installation company, solar panels will not damage your roof. If done incorrectly, solar panel installation can not only damage your roof, but void your roof warranty. For your protection and peace of mind, check with the roc.az.gov that your solar installer is indeed licensed and insured.
Does the installation have to be on a south-facing roof?
The more sunlight solar panels receive, the more power they generate. Because of this, solar panels are most effective when installed on a south-facing roof. Solar panels installed on an east- or west-facing roof produce about 20% less power than on a south-facing system. If a south-facing roof is not available, installation on a west-facing roof is the second-best option. West-facing panels receive sunlight in the afternoon when the sun is the hottest and when electricity usage and charges are the highest. Panels installed on an east-facing roof are also a viable option. Technically, solar panels can be installed on a north-facing roof, but it may take25 years for them to generate enough power to reach a break-even point for the home-owner.
To find out which direction your roof is facing, type your address into Google Maps and enable globe view (at the lower right side of the window).
Will shade interfere with solar generation?
Solar panels only produce power when they receive direct sunlight. This means less solar is generated in the winter and on overcast days. Shade or shadows also prevent solar generation. Current solar technology and regulations are such that, if one panel is partially shaded for part of the day, the remaining panels will continue to generate power. Your initial solar consultation will determine the best location for your solar panels to receive the most direct sunlight over the best period of time.
Will pests interfere with solar generation?
Pests such as birds or roof rats can nest under solar panels and interfere with the generation of solar power. For an additional cost, homeowners can invest in rodent guards to prevent nesting under their solar panels.
Financial & Insurance
Should I lease or buy my solar panels?
Leasing and PPAs
There are a few different ways to add solar to your home. A lease or Power Purchase Agreement means leasing solar-generated power, not the solar equipment. In both cases, the homeowner is not purchasing the panels and the panels do not add value to the home.
In either case, the home-owner does not own the solar panels. In the event the home is sold before the lease expires, the home buyer must take over the lease unless the home seller pays it off. While they do still exist, leasing and PPAs were more common options for solar power before solar became affordable for purchase.
Secured and Unsecured Loans
Financing has made solar power affordable for many homeowners. There are three ways for homeowners to purchase solar panels: cash purchases, secured loans, and unsecured solar loans.
Homeowners can get a secured or unsecured loan through a bank or credit union. Interest paid on a secured loan, such as a home equity line of credit, is tax-deductible. Secured loans are a good option for a homeowner who wants to maximize the financial benefits of going solar and who is comfortable using the home as collateral. An unsecured loan may have higher interest rates which are not tax deductible, however collateral is not required.
Solar loans are unsecured loans. Solar financing is NOT a service of a solar company. Solar loans are financed by a third-party provider. While there are pros and cons to each of these purchase options, it is important to note that paying cash or obtaining a secured or unsecured loan through a bank/credit union can save homeowners 10-20% on hidden origination fees.
Will a lien be placed against my mortgage?
If you finance solar with a secured loan you will be using your home as collateral and a lien will be placed on your house. If you finance solar with an unsecured personal loan, a lien will not be placed on your home. If you finance solar with a solar loan, a lien will be placed on the solar equipment. Solar that is leased or obtained through a PPA does not belong to the homeowner, therefore there are no liens.
What are the current tax incentives?
Homeowners who purchase solar equipment for their homes in 2020 or 2021 are eligible for federal tax credit. Arizona residents are eligible for a tax credit in the tax year the solar is purchased. Power Purchase Agreements and solar leases are not eligible for federal or state tax credits.
Federal Solar Tax Credit
With the Federal Solar Tax Credit, also called the Investment Tax Credit (ITC), Homeowners can deduct 26% of solar installation costs from their 2020 federal taxes. In 2021, this tax credit is reduced to 22%. Homeowners who do not have enough tax liability to claim the entire 26% tax credit in 2020 can roll over their remaining tax credits to their 2021 federal taxes. The tax credit is currently set to expire in 2022 for homeowners.
Arizona Residential Solar Tax Credit
The year they install solar, Arizona homeowners receive a 25% reimbursement of the cost of solar installation, up to $1,000, on their state taxes.
Arizona Energy Equipment and Property Tax Exemption
In Arizona, the purchase of solar equipment is not subject to sales tax. Furthermore, the additional value added to your home by purchasing solar equipment is not subject to property tax.
Are solar panels covered by my homeowners insurance?
Most homeowner’s insurance covers solar installation. Homeowner’s insurance covers perils such as wind damage, fire damage, damage from falling trees, and theft. Call your insurance company to add your solar equipment to your homeowner’s policy and to check limits.
Will my home have power in the event of an outage?
By itself, a solar array does not prevent you from losing power during an outage. In an outage, the only way to provide solar power to your home is with solar battery backup, which stores excess solar power for later use.
Do I need battery storage?
Because batteries provide additional security during a power outage, solar batteries may be a solution for homeowners who live in an area where blackouts are common. They also enable homeowners to go completely off-grid. However, solar batteries take up a lot of space, and in most cases their life-expectancy precedes their break-even point. This means that solar batteries need to be replaced before the profits are equal to the costs. For the typical homeowner, battery storage is an unnecessary expense.
How does a generator work with solar?
A generator is a cost-effective, space-saving alternative to battery backup during a power outage. Generators are fuel-powered (ie. propane, natural gas, diesel).
How will my utility company reimburse me for excess solar?
State law and utility company policies determine how homeowners are credited when they generate more power than they use, which is called net excess generation (NEG). Net metering is the standard utility reimbursement. With net metering, if you generate more power than you use in a month, you will receive a credit to your electric bill. If you generate more electricity than you use throughout the year, your electric company may pay you in cash.
According to Arizona’s NEG rule, for homeowners on a time-of-use rate plan, excess power generated during on-peak hours will be credited for on-peak use; excess power generated during off-peak hours will be credited for off-peak use. Some Arizona utility companies, such as tribal-based utilities, do not credit homeowners for generating excess power.
State law and utility companies have limits on excess solar generation. In the State of Arizona, homeowners may install a system that produces up to 125% of their total power use. APS limits the amount of excess power you can feed into the grid based on the size of the electric service panel that connects you to the grid. In addition, APS charges a monthly fee per kW for that connection. While SRP does not set maximum limits on the amount of solar you can generate, they do limit how much you will be credited for excess power.
How do I see how much power I’m generating?
Your solar company will provide you with an app that allows you to view your solar production. Your power company will also provide you with a statement of power generated and credits earned. In addition, the solar inverter on your home shows power usage and power generated.
How much maintenance will I be required to do?
In general, maintenance is not required for solar panels. Rain and snow are typically enough to clean dust and debris off solar panels. However, studies have shown that regularly cleaning solar panels boosts efficiency up to 30%. Cleaning solar panels can be as simple as spraying with a hose. After a haboob, Arizona homeowners may want to use a hose-attached window cleaning solution and/or a long-handled soft brush to return solar panels to full-efficiency.
Do you have questions we haven’t answered? Contact a Redline Electric & Solar representative at [email protected] and we’ll be happy to help.
NABCEP certified Redline Electric & Solar is the best choice for your electrical and solar needs in Arizona. We are a family owned and operated electrical contracting business, with over 60 years of combined experience. We pride ourselves in our honesty, integrity and high quality work, with 100% satisfaction guaranteed to our customers. When you choose Redline Electric and Solar, you can have peace of mind and be confident that you made the right decision.