With such a long list of benefits, you’d think solar panels would sell themselves. But many potential customers still need convincing before they can make the jump to green living. As beneficial as solar panels are for reducing a household’s carbon footprint and increasing its energy efficiency, the cold, hard facts about the benefits of solar can be more compelling and persuasive.
Dispel Solar Myths
During your chat with a potential customer, consider directly asking them why they are hesitant to buy solar panels – you may discover that they’ve fallen prey to a myth you can easily disprove. Two of the most common myths are that solar panels are too expensive and that they will be cheaper in a few years.
Myth: “Solar Panels Are Too Expensive.”
Busted: While solar panels used to be too expensive for most households, the costs have dropped 70% over the past two decades. In 1998, a 5kW solar panel system cost around $86,000. In 2014, the average cost was down to $26,000 — and these costs can be reduced even further with federal and state tax credits. The Residential Renewable Energy Tax Credit provides a 30% tax credit, and several states offer additional incentive programs and rebates. Taking advantage of federal and state incentives could cut costs by 30–50%. And just like other large home purchases, there are multiple payment options to make solar installation costs more manageable.
Myth: “I Should Wait Until Prices Drop.”
Busted: While solar panels have significantly dropped in price, that’s not necessarily a reason to wait for them to continue decreasing. The biggest reason is due to the Residential Renewable Energy Tax Credit. A solar panel system must be installed by December 31, 2019, to be eligible for the 30% tax credit. Several state programs will also continue to cut energy rebates as more people install solar panels.
Explore the Four Cost Options
One of the biggest decisions a customer will make is how they’ll pay for their solar panels. This depends on several key factors, including a customer’s finances, living situation, and energy goals. Explaining the diverse options and making recommendations based on these factors can help a customer feel more confident. Start by calculating the costs of solar panel installation, based on the customer’s current utility bill costs, state energy costs, desired solar system size, and hours of peak sunlight. From there, you can help potential customers evaluate the four available payment options.
- Cash. This is the simplest option. The customer pays the solar company for the entire cost of their home’s solar system upfront. By paying cash, they own their solar panels and are eligible for energy tax credits.
- Loan. If a customer wants to own their solar panels but doesn’t have enough to pay the costs entirely upfront, a loan may be the best option. They pay a small down payment upfront and a monthly loan repayment fee.
- Lease. A solar lease means a customer agrees to pay a fixed monthly rent in order to use the solar energy system and reduce their energy bill. Leasing solar panels allows a homeowner to immediately take advantage of energy savings with a very small, if any, down payment.
- Power-Purchase Agreement (PPA). A PPA is similar to a lease — but instead of renting the system, a customer agrees to purchase the power generated at a fixed rate, which is usually cheaper than the local utility’s retail rate. With a PPA, a developer manages the permitting, financing, and installation of the solar panels. These agreements can last anywhere from 10 to 25 years.
Multiple payment options make solar energy affordable for all homeowners, whether they’re ready to commit to purchasing a system or would prefer a less expensive renting alternative.
Share the Impressive ROI
One of the biggest selling points for solar is the potential return on investment. As shared earlier, solar panels are more affordable now than ever before, averaging $26,000 before tax credits — which can reduce the total by another 30–50%. A solar panel system also improves a home’s property value by an average of $24,705 and helps it stand out in a competitive market as more home buyers look to purchase energy-efficient homes. When you factor in federal and state tax credits and the increased property value, homeowners can recoup up to 97% of their solar investment costs — not including the ongoing energy bill savings. In fact, solar panels can save a homeowner $20,000 over the course of 20 years on their energy bill.
Walking through some of the common concerns and confusions regarding installation costs, payment methods, and return on investment can help potential customers better understand the value of solar and what steps to take based on their financial situation and energy goals.
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