Solar energy offers significant environmental and money saving benefits so it is no surprise that the industry has doubled in size over the last three and a half years. The residential sector is growing quickly across the US and it is forecast to have an average of one solar installation per minute by 2024.
Environmental benefits are important; however, it is often the money saving benefits which drive growth of an industry and opt-in from consumers. The data presented below gathered from Solar Reviews focuses on the 25-year estimated cost savings among the top 20 solar cities in the US with 6 kW cash-purchased solar energy systems. To put the money benefits in perspective we have compared them to high-end home improvement projects that a homeowner could undertake with those 25 years worth of savings.
What Luxury Features Could 25 Years of Savings Get You in the Top Solar Cities?
In the above graphic, the top solar city based on its 25-year bill savings with solar energy in each of the four major regions of the US is showcased. We have chosen a luxury feature that could be installed for a similar cost to the amount you could potentially save to really get an idea of what these savings from solar energy are worth! Here are the dream home improvements that could be afforded in each city.
San Diego, CA ranks as the top solar city in the US with an estimated 25-year bill savings of $95,412 which is an ideal budget for installing an impressive 12 x 14 foot infinity pool with all the extras, like decking, stairs, fencing, and landscaping. A project like this ranges between $90k and $105k, with most people spending $98,000.
Eighth overall and first in the northeast region is Boston, MA and its residents can save an estimated $56,753 over their 25-year usage of solar energy. This is more than enough for the typical cost of $50,000 to convert a room into a dedicated home theater with carpeting, risers, seats, acoustic materials and a full sound and visual setup. With the remaining savings, homeowners could even add a deluxe popcorn machine!
In the midwest, Detroit, MI takes the top spot (14th overall in the US) for savings on energy bills. Here, the estimated 25-year cutdown in cost is $43,510, just enough to build your very own Tuscan-style wine cellar in your basement for which costs range from $40k to $200k depending on material selection.
Houston, TX, in the south, is ranked 20th overall in the US, but top for its region. The $39,660 estimated 25-year bill savings can fund the installation of a private backyard basketball court with some money to spare! Most projects to install and illuminate a tiled half regulation court with painted lines, an in-ground hoop and a scoreboard cost about $35,800.
Top 20 Solar Cities in the U.S. Based on Energy Bill Saving Estimates
Estimating future cost savings is not a perfect science; however, using historical data and trends to estimate the future rise of energy costs can help to calculate the estimated future savings for those with solar energy. Solar Reviews identified the top 50 solar cities (those which use the most solar energy in homes) and used these methods to calculate their 25-year estimated cost savings. The graph above features the top 20 cities.
The top seven cities on the list all belong to sunny California. California was recently ranked as the 6th most costly state for residential electricity prices and it is ranked 5th in terms of annual sunlight so it is no wonder that the cost savings are estimated to be highest here. There is a range among these top seven cities of approximately $30,000 with San Diego estimated to save $95,412. San Diego is the city with the second highest solar capacity in the U.S, with 337.7 watts per head of population. Sacramento is estimated to save $65,370. In all, there are a total of eight cities in California that make the top 20 with San Jose placed 10th with estimated savings of $49,205.
Boston, MA and New York, NY round out the cities with an estimated savings of over $50k. Although not as sunny as other states, high energy costs in these two cities could be argued as a contributing factor into their savings calculations.
Neighboring states to California make up the majority of the remaining top 20. Three cities in Arizona (Mesa, Tucson and Phoenix), two cities in Colorado (Denver and Colorado Springs) and one city each in Nevada (Las Vegas), New Mexico (Albuquerque) and Texas (Houston) all boast high 25-year estimated cost savings. Each of these cities have over $40k estimated in savings with Houston being the only exception coming in slightly under at $39,660.
Only two midwest cities appear on the top 20 list with Detroit, MI estimated to have $43,510 and Minneapolis, MN having $42,591 in estimated 25-year savings on energy bills.
Additional Factors That Affect Potential Savings
As mentioned, estimating cost savings is not an exact science, and there are some limitations to making solar saving estimates. Accuracy in estimating the long-term solar production in kWh tailored to your location coupled with predicting accurate economic values for a long period of time can be difficult to do. In addition, while most studies indicate the price of electricity is increasing each year by approximately 3% across the US on average, there is always the possibility for a particular city or region to rise more or less than expected, thus changing the estimated savings.
Panel Placement & Location
Panel placement and location must also be taken into account when calculating potential savings. The location and angle of the solar panels as well as the typical climate and physical distance from the equator where the panels are installed are important in calculating the total savings. Panels positioned at a less than optimum angle, operating in partially shaded conditions (whether due to a physical obstruction or cloudy environments) or in locations where peak sunlight hours are short (far from the equator) will still function, but they will do so at a reduced efficiency and wattage output. This can affect the amount of savings made as more costly systems may be required to ensure there is enough energy produced.
Solar panels can offer excellent cost savings after the initial payback period. For example, a 6kW grid-tied system installed in a moderately sunny area will cost most homeowners around $18,000. For those with annual energy bills of $2,000, it will take nine years to breakeven and begin experiencing the cost savings. If; however, you’re looking to go off-grid, your roof is sloped at more than 45 degrees or has weight bearing or sun obstruction issues, you should expect to pay more in additional equipment and/or alternative panel placement options. These factors should all be considered when calculating the ROI of this project and the length of your payback period as they will affect your potential savings.
Are Solar Panels for Me?
Solar panels are good for the environment as they are a clean, renewable energy source and have the potential to save money on energy needs over a period of time. However, they may not be the right solution for every home. There are many factors that go into how efficient a solar panel system is at generating power and how much the initial investment will cost. Being armed with the data, as well as finding a solar energy expert familiar with your location and climate is the best way to decide if this type of renewable energy is right for your home. Yet if you do find yourself in a prime location where you can reap the benefits of solar energy, taking into consideration what potential savings are worth in the long-run may just be enough to convince you to get some panels installed.