Solar generates wealth

Submitted by Sunrise Solar on Thu, 09/08/2016 - 10:39am

Part 5

"In much of the country, the Geostellar Solar Index shows that homeowners can actually generate more wealth with solar panels than stocks, bonds, CDs or other investments," says David Levine, founder and CEO of Geostellar. "The index's findings show residential solar power is not only viable, it's a wise investment."

The Geostellar Solar Index indicates that, in a total of 33 states, solar offers better ROIs than 30-year U.S. Treasuries, which have a current yield of 3.7%. It also points out that in 43 states, solar offers better ROIs than five-year CDs, which typically return only 0.75% annually.

"The wide spread between solar and conventional electricity in some markets has created broader opportunities for third-party financing and zero-money-down offers, where institutions become co-investors with the homeowner, providing upfront money and participating in the yields," Wirt says.

Leases, however, offer no yields, and customers lose many of the benefits like the tax credit and the short payback. Plus, they are locked into a 20-year agreement with minimal savings. This is significant, because purchasing a system now pencils out to about 50% less than leasing it over the long term. Recent reports demonstrate that the payback period of solar power systems is now as low as three years.

Effective policies, economies of scale and new technology have achieved something remarkable in recent years: Solar energy production is now at a scale and cost necessary so that it is affordable for everyone and a big piece of the energy puzzle. It is becoming part of the mainstream. Families, schools, hospitals and businesses are going solar in record numbers nationwide, even as incentives decrease.

The manufacture of PV in the U.S. may also increase significantly in the coming years as new technological innovations level the playing field with China. Additionally, economies of scale and supply chains in the U.S. have caught up and caused the price of solar to continually drop over the past six years, with further declines anticipated.

Leases and PPAs were an ideal solution for the solar sector in the recession, with energy bills continually going up but without accessible loans and equity. But with the advent of price drops throughout the industry, leasing just doesn't make sense anymore.

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